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Revenue Protection Pilot Process Results. Mission Statement.
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Mission Statement A cross functional team was formed to review the current revenue protection process, the potential impact due to the implementation of Smart Metering and provide options in regards to the future process at Gulf Power Company. It was agreed upon that a pilot would be conducted in the Pensacola Office, utilizing Field Service Representatives who were connect and disconnect qualified.
Objective • The Pilot would be conducted for twelve months from April 2011 to March 2012. • Two FSR’s working a total of one quarter each would be utilized. • T. Lynn Smith would train the FSR’s in field investigations, interviewing and completing case investigations. • Reduce the cost of an investigation. • Work orders in a timely manner. • Note accounts same day order is worked and reduce lost field information. • Increase collections and cost to recovery ratio. • Provide dedicated work force for revenue protection.
General Information • EEI estimates a utility’s loss due to theft runs between .5% to 2% of annual revenue. In 2010, Gulf had annual revenues of $1.6 billion. This would result in a loss between $8 - $32 million. • In 2010, Gulf Power’s Security Department identified $335,045 in theft,which is .0002% of the 2010 annual revenue. • With recommended improvement changes, the identified theft and recovery percentages would be increased.
Current Process • The FSRs work approximately 98% of possible theft cases as a Check and Seal order in ARMS. • Security Investigators work approximately 2% of the theft cases on a Revenue Protection order. • There can be approximately 15 -45 days of unauthorized usage on a meter, due to the reading cycle, priority to work order and man-power. • Completed orders are referred to the Security’s CSR to calculate the amount to collect and note the account in CSS. • Security’s CSR creates a Diversion Investigation Management System (DIMS) case on the completed Check and Seal orders. • The Investigator receives the FSR’s completed Check and Seal order to determine who is responsible. This is accomplished by a phone call or visit to the address. • The Investigator will complete the DIMS case and forward the information back to the Security CSR. • The Security CSR will close and file the DIMS case and update the case if the customer pays. • Recovery is attempted when future customer contact is made. • If customer sets up an active account before account is noted, Security CSR will bill the responsible customer the identified charges.
Drawbacks to the Current Process • High labor cost of working a case (reduce Investigator’s involvement). • Revenue Protection duties are often shifted to a lower priority (wire theft, storm duty). • Orders are not worked in a timely manner. • Accounts are not being noted in a timely manner. • Multiple organizational owners. • Insufficient resources
Labor Cost related to Revenue Protection (current) • Labor cost (includes salary, benefits, ... ; not including transportation, IT and other overheads) of employees associated with revenue protection duties are: • Sr. FSR $31.84 per hour • Sr. CSR $34.87 per hour • Staff Investigator $60.62per hour • Average time spent on a case is: • FSR at 5 minutes ($2.65 per case) • CSR 15 minutes ($8.71 per case) • Investigator 30 minutes ($30.31 per case) • In 2010, the cost to work, calculate, and investigate 1,985 cases worked by FSRs and forwarded to the Security Department (Investigator and Security CSR) was $82,715. Cost Summary • In 2010, 1,985 cases had identified loss of $335,045 • The amount collected was $135,492 • For every $1.00 we spent we collected $1.64
Options Option 1 Continue current process using remaining FSRs and Security personnel. Option 2 District Customer Service Operation Owns the Process. Option 3 Corporate Security owns the Process Option 4 Share ownership Corporate Security/District Customer Service Operations
Results • Inspectors worked an order within 3 days of being generated. • Inspectors reported field investigation information and accounts were noted same day. • In 2010, the cost to recovery ratio $1 to $1.64 • In 2011, the cost to recovery ratio $1 to $4.65. This increased due to removing the Investigators cost. • Collections for the pilot were 38.25%; collections for Eastern and Central for this same time were 30.5%. • Two FSR’s were assigned to Revenue Protection Pilot each quarter.
