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• Ticket volume is increasing:
Locate volumes have been increasing between 5-30% annually depending
on the geographies you are in. Even
if you aren’t building a lot of new infrastructure, or advancing your current infrastructure, your competitors likely are, and your third-party locating bills are likely going up because of it.
• Labor, supplies, and gas are all getting more expensive due to inflation: With inflation at a 40-year high, the cost of labor, supplies, and gas is driving the pricing of third- party locating services up significantly. It is not uncommon to hear that locating bills have surged by between 10 - 30% and your finance and senior management teams may be starting to ask questions about what can be done to control these cost in an area that had previously been an afterthought on the balance sheet.
• Project tickets are increasing tremendously, and they are the most expensive work type: With all the long- range fiber installations, project
work has been increasing significantly. These ticket types are regularly billed
at a much higher hourly rate than
a traditional ticket. Recently, our
team at KorTerra spent time with an organization that saw their number
of project tickets jump from 1,500 four years ago, to over 15,000 today (a 10X increase). This shocking number was something they were blind to prior to their conversations with us.
• Fiber damages are more expensive and have greater negative consequences: Damages to fiber lines are much different than damages to copper lines. According to an article titled “Cutting is Costly”, “the average drops to homes are about 200 feet and cost about $600 to replace. However, large fiberoptic cables could costs $15,000 to $20,000 to repair.” Not only are these types of damages more expensive, they have a larger/broader negative impact on your customer.
In the increasingly competitive environment where people have more options and are more reliant on home internet, you can’t afford to let bad service experiences negatively impact your reputation, resulting in
potential lost customers and lost revenues.
• Regulatory pressures are growing: In a recent conversation, one of the U.S.’s largest telecommunications provider shared that “Locates just came out of the woodwork for us. We started getting fines, and people began to realize just how much locating costs us.” Don’t let this be how your firm realizes there might be a better way to manage this! More and more, some state regulators are starting to increase enforcement and as these actions are proven out, other states will notice and quickly follow. With the criticality of internet in
the modern world, this focal point
will predominantly increase as customers continue to expect more and regulators are paying attention to those expectations.
• Customers expect more: Post pandemic, the number of people working from home daily has increased tremendously. Reliance on and expectations related to your service
has never been greater or had more scrutiny. Outages can have a huge adverse impact on customer satisfaction and in the modern world, negative news spreads quickly on social media. Reputational damage
and lost customers can have a hugely negative impact on revenues and in an increasingly competitive environment, negative events are making it easier for customers to make a change if you give them a reason to.
The financial equations and implications here can get large very quickly.
With per ticket locate prices ranging from $10-$50/ticket depending
on geography and ticket volumes, telecommunications companies that are leveraging third parties have large budgets attached to the completion
of this work. The pressures outlined above have all been combining at the same time and in the past few years are commonly resulting in budgets for these locating services increasing year over year in ranges between 20-30%. Depending on the size of your organization, your budgets in this
area are easily in the six, seven, eight, or even nine figure zone, and a 20 - 30% increase at these dollar levels is likely getting the finance and senior management team’s attention.
As a telecommunications company, what can you do?
Good news! There are things you can do to take back control and manage this. There are three main things that telecommunications companies should be looking at to counteract these new realities. The essence of each of these is about getting smarter in the way you are leveraging data to better control and manage these budgets moving forward while ensuring you are providing a better experience for your customers.
1. Increase vendor management visibility: Focus on increasing visibility into the status and performance of your third-party locating companies to better understand the work being performed. If you are relying on your third-party locating company’s reports, or logging into One Call Center websites, it is likely very challenging to find the analytics you need. Modern ticket management systems like KorTerra can provide a single pane of glass view into the status of tickets so you can confidently confirm that work being done is as you would expect, and you can begin identifying areas where work can perhaps be managed differently to reduce costs. Dashboards can provide an understanding of on-time percentage (OTP), completed on-time percentage (COTP), third-party locator individual performance, cleared in office, cleared in field, late tickets based on geography, ticket cycle time, damages heat maps, etc. This information can help inform other strategies you may want to
lean into such as how you can reduce damages, how you can ensure you are being billed appropriately for work performed, and how you can better control your locating budgets based on work performed data.
2. Implement ticket screening: What the data from the ticket completion process typically points to is an opportunity for tickets to potentially
be screened prior to them going to
your third-party locators. For every ticket screened, as we mentioned above, there could be savings anywhere from $10-$50 per ticket. Most organizations we work with at KorTerra in the telecommunications arena are seeing ticket screening rates ranging between 30%-67%. Take that ratio, multiply it
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2024, Issue 2 Arkansas 811 Magazine • 13