Convergent Billing Delivers Improved Customer Service

The need for improved customer service is paramount as utilities strive to become customer-centric business entities. While most customer service enhancement initiatives may focus at first on the utility call center, there is another utility-to-customer communication medium that is more pervasive: the monthly billing statement. A residential or small commercial customer may go a lifetime without ever picking up the phone to call the utility customer care center, but the billing invoice provides a consistent touch point between a utility and its customers. Forward-thinking utilities are focusing efforts on the billing department as a means of enhancing their overall customer service functions.

For good reason, electronic bill payment and presentment (EBPP) has been receiving the lion’s share of attention in regards to billing technology, but EBPP is not the only advancement in billing. As more utilities diversify their service offerings and look at providing additional services such as telecommunications and Internet access, convergent billing has emerged as a concept that can improve not only customer service, but the utility’s bottom line as well.


The Location Maintenance window shows the service categories that form the basis of the new billing solution in use at the Utilities Commission of New Smyrna Beach.
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Convergent billing is the practice of integrating charges from multiple services onto a single customer bill. While it’s not necessarily a new concept-some utilities have been using a certain level of convergent billing for years-advancements in software and systems have made convergent billing perhaps a more viable option than it has been in the past.

The Utilities Commission of New Smyrna Beach, Fla., has been issuing combined billing statements to its customers for some 17 years, but a recently installed system has made the task much easier for the municipal utility, taking the billing chore out of the IT department and putting it in the hands of customer service representatives. The Commission provides a number of services to residents and commercial enterprises in and around the smallish Atlantic Coast town of New Smyrna Beach, Fla., located about 15 miles south of Daytona Beach. The Commission serves more than 21,000 electric customers and 17,000 water customers. In addition, the Commission oversees bill payments for Internet services to more than 14,000 customers and garbage collection services for about 14,000 customers. It also collects the county tax for Volusia County, city tax for New Smyrna Beach, and sales tax and gross receipt taxes for electric services for the state of Florida.

All told, the Utilities Commission either provides or bills for 11 distinct services. That would be quite a stack of bills for the Commission to send out on a monthly basis-and quite a stack for New Smyrna Beach residents to sift through and pay each month. Many of the Commission’s customers subscribe to more than one of the Commission’s 11 billable services. The solution for the Commission has been convergent billing, and it has employed that tactic since 1983.

“When you have a combined bill, you save money on postage and time when it comes to processing payments,” said Roberto Montalvo, Utilities Commission chief financial officer. “More importantly, it (convergent billing) improved our service, which makes our customers happy.”

Until two years ago, the Commission had been managing its billing process in-house on a Hewlett-Packard mainframe system. All of the billing system’s code was written in COBOL or 4GL, and all the inputting of customer billing information was done by employees in the computer department. All pertinent customer information was hand-written by customer service employees and then passed to the computer department where it was coded into the convergent billing system.

In 1998 when the Commission decided to upgrade its system, it discovered HP was no longer supporting the 4GL code the Commission used for programming. Rather than continuing with a mainframe system, the Commission decided it needed to switch to a client/server solution. “We could no longer upgrade the system without having to totally rewrite all of our online code,” said Connie Hodges, a programmer/analyst with the Utilities Commission. “That was a big reason for us to go client/server.”

Besides the technical necessity of the upgrade, the Commission had some other practical reasons for wanting to move to a new billing system, one of which was the need for an easier-to-use system. Five years ago, the Utilities Commission of New Smyrna Beach staffed 189 employees; today, 120 employees carry the work load. The market reality of needing to do more with less called for a user-friendly billing system. “We wanted to take the customer data entry work out of the hands of the computer department and put it in customer service,” said Hodges. “We always thought that was where it belonged, but with the system we had before, it was very difficult to do that.”

After researching a number of client/server billing solutions the Utilities Commission implemented Aquilium Software’s Customer Management Solution in January 1999 to manage its billing process. Having looked at a variety of client/server solutions, Montalvo said Aquilium was the right choice because it offered the most value and flexibility for the type of work the Commission needed to do. More importantly, the Commission was drawn to the fact that the new system was based on Microsoft Windows NT/SQL server and could seamlessly integrate with the Commission’s financial management software from Great Plains Software. The system also integrates fully with the Commission’s metering department. Inputs from the metering department are immediately reflected on the customer service side, Montalvo said.

“By using the Customer Management Solution, we’re now able to track information more easily and efficiently, and complete accounting documents in minutes,” said Montalvo. “The solution can track meter readings as well as consumption estimates which has also helped us improve our service.” The solution’s ability to integrate all the information being processed through the system has also helped the organization manage its customer relationships more effectively. The end result, so far, has been enhanced business efficiencies and better customer service.

According to Montalvo, the implementation of the new billing solution took about six to eight months, about four months of which was needed for converting data from the legacy system to the new Aquilium system. “It was a challenge for us,” he said. “We had to learn and implement new procedures to accommodate the software, but we were able to do that.”

Moving from the legacy system to the updated solution also meant there was a steep learning curve for the staff members who would actually be working with the system on a day-to-day basis. “The learning curve was probably the most difficult part of the implementation,” said Hodges. “The customer service reps who had to enter the information into the system had never had to deal with coding the services before. We made some mistakes at first, but everything worked out.”

With the new system, customer service representatives no longer have to hand-deliver information to the IT department to have it coded into the billing system. “All that has changed,” said Hodges. “Everything is now done while the customer is on the line or in the office with customer service. All the information is immediately put into the computer.”

“It took the customer service people a while to get used to the new system,” said Montalvo, “but now they’re flying with it.”

Looking ahead, the Utilities Commission hopes to further improve its customer service by delivering convergent online billing. By some estimates, companies can save from 50 percent to 60 percent by implementing an Internet billing program. Market information and consulting firm PSI Global predicts that Internet billing activity will soar to nearly 5 billion consumer and business billing transactions in 2005. Jupiter Communications has predicted that by 2003 18.4 million household will be paying their bills online. “That’s the way we’re headed,” said Montalvo. “The ability to issue statements without having to print them out will save us money and time. For our customers who are using the Web more extensively, this will certainly provide an added service.”

Convergent online billing is probably not too far in the future for the Commission. Despite its relatively small service territory in a state which has shown reluctance about moving to a deregulated utility environment, Montalvo says that the utility realizes the need to stay current with technological advancements. The currently installed billing solution will allow the Commission to grow with the times.

But even without making the move to online billing, Montalvo says the updated billing solution has proven worthwhile-both to the utility itself and its customers. “Even just changing one aspect of our business, like the new billing solution we’ve implemented, makes our work easier and eliminates mistakes,” said Montalvo. “That’s passed on to our customers as improved customer service.”

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