Implelementing a new customer care and support system

Electricidade de Portugal S.A. (EDP) began an ambitious mySAP Utilities project aimed at overhauling its entire business environment at the end of 1999, and decided to replace its oldest commercial systems (SEGEC and SGCCE), which were responsible for managing the customer service, metering, billing and collecting processes.

SEGEC was a mainframe-based package that had been adapted from an existing package at another utility company, and improved during its 10-year lifecycle. SGCCE was a 20-year-old in-house mainframe development. Both packages met current EDP requirements, but the knowledge that the utility would face important future challenges made change a necessity. Some of these challenges included:

  • deregulation of the electricity market;
  • Euro implementation;
  • increasing competition;
  • a customer-oriented strategy; and
  • the new technological environment.

The main requirements for the choice of software were established after considering the expected evolution of the market. Accordingly it had to be:

  • functionally and technologically state-of- the-art, using best practices and incorporating client-server architecture, relational database and real-time information needs and a universal and flexible billing engine;
  • flexible, including easy adaptability to business changes and to new products and services;
  • compatible, with easy integration of systems and a guarantee of uniform procedures; and
  • Euro-adapted.

Software selection

Before selecting a new software solution, EDP undertook a study of the main options available. These were analysed by an IT and Business Team, in close collaboration with the providers. The outcome was a ‘Gap-analysis’, which gave EDP a product evaluation, a list of the gaps identified and a list of special developments required.

The SAP IS-U/CCS (Industry Solution for Utilities/Customer Care and Service) solution was chosen because of its versatility and on going development, and because it can be used with any hardware or database. This allows the IT specialist at the electricity supplier to select the best infrastructure for the task. Total integration with the EDP SAP R/3 system, and the ability to integrate the system in a web environment, were also relevant factors. Scalability was a fundamental requirement, and SAP’s ability to guarantee sufficient consulting capacity for the duration of the implementation process also was important.

After selecting the software EDP started the ‘ClienteMais’ (Customer Plus) project by defining the scope, methodology, organisation, schedule and main objectives.

Project Scope

The project scope covered device management (device installation, removal and replacement, meter reading, inspections and certifications); customer service (contact and claims management, front-office, move-in, call-centre interface); billing and invoicing (consumption billing, service and product billing, budget billing plan, invoicing) and contract accounts (receivable and payable). When all these capabilities are installed, the company hopes to process payments by bank, ATM, agents or post offices, periodically and automatically.

The system, which will have about 2,000 users, also features functions for bad debt management, security deposit management, shop connection, instalment plans, work management with service orders related to connections, and energy disconnections and reconnections. Interfaces with external systems such as a geographical information system, outage management, mobile data entry devices for meter reading and service orders and external access via the Internet to update service orders, are also provided.

The project also includes the establishment of a new call centre using mySAP CRM. In the first phase, 150 agents will work in the call centre, with this number eventually rising to 300. The company also wants to improve customer contact on an ongoing basis via the web. The Internet project ‘Cliente Online’ (Customer Online) allows customers to select a contract on-line, view their billing and payment history, access a consumption overview, and display and enter meter readings. The company will also implement mySAP Business Intelligence in two 'go-live' phases beginning in September 2001.

A multidisciplinary team of 142 consultants and users support the ‘ClienteMais’ project. These include EDP Distribuição functional users, legacy systems specialists, SAP IS-U/CCS consultants, business consultants and change management consultants. EDP’s ACE group plays an important role in this team, with more than 70 consultants allocated to the project. ACE consultants are also responsible for quality assurance.

Implementation Strategy
The implementation strategy was based on SAP’s methodology and tools, ASAP for Utilities. The first phase was a business blueprint process where all the business processes were designed. Quality control and user training were the basic tasks completed in the final preparation phase, before going live.

EDP realised early on that a vast amount of training would be required to prepare users for the new system. Each training course was tailored to a particular department or area, and cascade training methods were adopted involving 70 to 80 trainers. A dedicated exercise system was also set up and electronic manuals are available. And to ensure users don’t forget what they’ve learned, the training is continued on an on-going basis.

The 'go-live' strategy is structured in steps involving the roll-out of different modules, with the first realising EDP’s requirements for the Euro, including functions such as contract accounts, collecting, bad debt recovery, invoicing and the interface with the old system to receive the required billing documents. The meter reading and billing processes make up the second 'go-live'.

Change management has been important during such a huge project. EDP has been deeply involved in all the suggestions made by the change management team, which have contributed to easier system acceptance.

Critical Issues

EDP has encountered and solved several problems, some of them occurring for the first time in an SAP project. In fact, the critical dimensions of the project – the biggest IS-U/CCS installation worldwide, with 5.5 million customers, 10 million contracts and 300,000 bills per day – has been a test for both the system and the project team.

Critical issues included:

  • the complexity of implementing a multi- company and multi-division concept (shared with Lisboagás);
  • the special legal requirements regarding invoicing and VAT;
  • the complexity of different payment methods, as in addition to the three IS-U standard ways (direct debit, cash, cheque at cash desk) EDP allows payments at post offices, ATMs and EDP agents;
  • a different meter reading procedure, and the need for a new feature providing daily automatic meter reader street routes;
  • the high level of project development and legacy system automation procedures;
  • data and document archiving;
  • on-line and batch printing;
  • batch processing volume;
  • migration processes for a huge volume of data;
  • authorisation profiles for a big structure;
  • reporting; and
  • system performance (stress test).

Some of these critical issues led to new developments, making the EDP IS-U/CCS system an extended and more sophisticated version of the standard system.

Benefits

The IS-U/CCS implementation will bring many benefits to EDP and will prepare the company for some of the important challenges in the future. The most immediate benefits are:

  • a new technological environment;
  • availability of best business practices;
  • the use of workflow, which will ensure that business functions are managed through to completion;
  • Euro implementation; and

    * integration with the SAP R/3 system.

EDP today is a ‘new’ company, well prepared for the challenges that market liberalisation will bring, customer-oriented, flexible, and (through the ACE companies) possessing the knowledge to allow it to replicate projects like this elsewhere in the world.

About Ace and Electricidade De Portugal
ACE Sistemas Comerciais and CaseEdinfor are both companies in the ACE group, one of Portugal’s largest IT groups. ACE, of which the mainshareholder is Electricidade de Portugal, is composed of more than 20 companies offering services including outsourcing, system integration, e-business, consulting and quality management and active in several countries including Brazil, Portugal, Spain, France, Angola, Mozambique, Morroco, Cape Verde and East Timor. It has completed more than 150 projects. Due to its experience with utilities, ACE can provide ERP and billing systems based on R/3 and IS-U/CCS solutions and also self-developed solutions. Its experience also extends to other areas, including CRM, business-to-consumer scenarios, business intelligence systems, call centre integration, geographical information systems and outage management systems.

Electricidade de Portugal S.A. is an electric utility company providing energy generation, energy trading, and distribution and retail of electricity in Portugal, South and Central America (Brazil, Chile, and Guatemala), Africa (Cape Verde and Morocco), and Asia (Macau). Headquartered in Lisbon, EDP comprises more than 30 affiliated companies with 12,700 employees, and has more than 40,000 industrial customers and 5.4 million residential customers. ln 2000, energy sales topped 34,176 GWh worth €3,675.9 million ($3.3 billion). EDP was a centralised state organisation until 1994 but subsequently the state holding has shrunk to 30%.