M2C process analysis and implementation of optimization potentials
Challenge
The meter-to-cash (M2C) process is of major importance for energy utilities, as it covers all steps from measuring energy consumption to invoicing and receipt of payment. The fact that different departments and sectors are tied into this process raises the likelihood of bottlenecks and weaknesses in the workflow.
At a Swiss municipal utility, the M2C process resulted in invoices that were incorrect and sometimes even lacking altogether. Additional weak points were metering equipment for which readings were missing as well as a poorly functioning communication system. For these reasons, the company decided to analyze the process in depth and derive targeted improvement measures.
Solution
The municipal utility commissioned Fichtner Management Consulting (FMC) Switzerland to analyze in a first step the M2C process and identify the underlying causes of the billing problems and the other shortcomings. Particular attention was paid to the interfaces between the departments involved and the responsibilities throughout the entire process.
A key problem that came to light was the lack of comprehension of the process as a whole. Often, staff only understood the area in which they were directly working, without being aware of the interconnections with other process steps. Another problem was the unclear assignment of tasks, competencies and responsibilities, particularly at the interfaces between the different organizational units. Furthermore, the monitoring tools then in place were geared mainly towards overseeing sub-processes. This meant that they did not consider key metrics that went beyond individual process steps and were thus unable to gage and optimize overall process performance.
Countermeasures were derived from these and other analysis findings in close consultation with our client so as to eliminate process weaknesses and resolve billing problems over the long term. The first and most important step was to set up and immediately put into practice centralized responsibility for M2C together with associated organizational adaptations.
In a second step, FMC provided the in-house project manager with technical support and also helped with regard to working practices. The implementation of twelve concrete measures, like development of well-defined role and interface descriptions throughout the entire M2C process, or implementation of a cross-departmental working group, counteracted the originally identified causes of the deficiencies. Another success factor was development and implementation of an M2C governance concept with transparent KPIs and clearly defined responsibilities for sub-processes.
Conclusion
FMC’s comprehensive process analysis to pinpoint the specific causes of the billing problems and the holistic approach to implementing targeted measures were key factors that led to successful process optimization. By subsequently implementing the measures in close partnership with the operational units, FMC was able to establish the basis for an effective and efficient future M2C process.
