Tuesday, November 16, 2010


We had a delightful email yesterday from someone who didn't quite believe what we described.  They didn't think that anybody would be that silly to set up a scenario that would encourage bad debts.  

The situation is bizarre.  However it is a result of the Power Companies are too large.  What happened is that the board members and directors of the companies had huge pressure put on them to change their policies and ensure that nobody ever died.  

I will describe now what we saw in the Power Company I worked for.  The board members summoned the head of customer operations and said "do something NOW to ensure that this cannot happen to us"
The first thing the head of customer operations did was institute a policy that on every phone call into the call centre the customer must be asked "are you medically dependent".  This was asked on every call.

Call centre staff had half an hour training on medically dependent customers.  Most of them wound up even more confused than they were before.  What started happening is that contractors would go out to homes to disconnect for non payment, the customer would call up the contact centre and be asked "are you medically dependent?"  The customer would say "what does that mean?"  and get the response of "it means we won't disconnect your power"  

And then the obvious followed.  

Customer operations then designed a plan to ensure that nobody else would be cut off.  They did this without reference to the credit team, and without reference to finance.  

You see the Power Company was too big that customer operations was completely divorced from the credit team.  The customer operations was in it's own little 'box' away from everything else and all it was going to be measured on was 'ensuring nobody dies'.  

That was how it happens.  Unlike small companies where managers see the big picture, nobody in that Power Company could see beyond their little area.  

Hopefully that gives you some more information.  

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