| Fines iof regulatory service levels are not met | Cost of implementation of the project and net benefit per annum | ||
| Particualrs | Amount ($) | Particualrs | Amount ($) |
| Fines | 20,00,000.00 | Administration costs of the project | 10,00,000.00 |
| Additional support cost | 5,00,000.00 | ||
| Total cost | 15,00,000.00 | ||
| Net benefit per annum | 5,00,000.00 | ||
| Net benefit per annum subseuent to the year of implementation | 10,00,000.00 | ||
| Total bills handled and FTE in 2015 | |||
| Months | Bills handled | FTE | |
| January | 527557 | 543 | |
| February | 427474 | 430 | |
| March | 449291 | 452 | |
| April | 411606 | 425 | |
| May | 422503 | 443 | |
| June | 423341 | 446 | |
| July | 438335 | 460 | |
| August | 457563 | 484 | |
| September | 399135 | 418 | |
| October | 462165 | 505 | |
| November | 414191 | 447 | |
| December | 388914 | 428 | |
| 52,22,075.00 | 5481 |
Business Case Financial Model
BILLS denotes Billing Interface Liability and Logistics Strategy.
Improving the billing system within Region X is the objective of the management.
BILLS is expected to transform the billing process within the organization.
Pre-Implementation stage of BILLS
In order to implement BILLS within the organization the existing billing system has to be replaced.
The useful life of the existing billing system is close to its end.
Thus, replacement of the existing billing system is compulsory.
The management has to decide which new system shall replace the existing system.
BILLS
Both technology and business components consist of the new proposed billing system.
Technology component will help in replacing the existing billing system.
Standardization of operating models, processes and guidelines used in 20 bill centers is the responsibility of business component of BILLS.
Objectives of BILLS.
Improving the existing billing system within the organization.
Standardization of processes and procedures used in billing system in all bill centers of the organization.
Delivering BILL capabilities as per the industry standard.
Utility and benefits of BILLS
The benefits and utility of BILLS can be primarily segregated into business and IT benefits.
Business benefits are benefits that will improve the efficiency of business operations and help the management to run the business operations with greater control and effectiveness.
IT benefits are mainly benefits which are directly associated with the information and technology infrastructure within the organization.
Business benefits of BILLS
Successful implementation of BILLS would help in reducing the number of agents and management FTEs.
Reduction in error rate as the proposed system (BILLS) is far more advanced and technologically sound compared to the existing system.
Training time is also expected to reduce significantly subsequent to the successful implementation of BILLS.
IT Benefits of BILLS
Successful implementation of BILLS would help the organization in reducing the expenditures required on maintenance as the proposed requires significantly less maintenance as compared to the existing system.
No temporary technology solution will be required subsequent to the implementation of BILLS.
Additional Benefits of BILLS
Consistent experience of members.
Promotion of member acquisition.
Promotion of member retention.
Greater satisfaction of members.
Huge benefit to the organization with greater emphasis on reuse technology.
Business information
In 2015 total number of bills handled were 5,222,075.
In order to handle the above bills in 2015 the organization used services of 5481 FTEs (For detailed calculation please refer to attached excel sheet).
Successful implementation of BILLS would result in reduction of FTEs required to handle bills.
Thus, operating expenditure will be reduced significantly with the implementation of BILLS (Muller, Suhner & Iung, 2016).
Cost benefit analysis
The implementation and administration cost of the project is $1,500,000 in the year of implementation.
The fines if the regulatory service level are not met is $2,000,000 per annum.
Thus, net benefit is $500,000 in the year of implementation and $1,000,000 per annum subsequent to the year of implementation (Ranney, 2016).
Note: For detailed discussion please refer to the attached excel sheet.
References
References
