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Selling fixed telephony services

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MBA 670 - OPERATIONS & QUALITY MANAGEMENT

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Professor: Dr Karamanos
Ioannis Treppides

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Telepassport Telecommunications

Lecture 1

The operation which will form the basis for my assignment is the
provision of fixed telecommunication services at Telepassport
telecommunications Cyprus.

Telecommunication is an essential need in our days. A very big

percentage of houses and all companies have at least one fixed
telephone line in different variations: Analog or digital. Telepassport
can provide this service to the public of Cyprus.

Selling fixed telecommunication services is the main task out of all

sale activities. The way the operation works is the following: Either
we contact the customer by telemarketing or the customer contacts
us on the phone number or via e-mail or through posted in our
advertising media. The cuistomer visits our shop or the shop of an
authorized partner or we visit the customer at his/hers premises.
The customer signs the relevant forms and in a few days we connect
the phone line.

This operation is characterized as the most important for various

reasons. First is the need for communication. Even though mobile
telephony entered for good in our lives, the fixed telephone is still in
use mostly because of its cheaper rates. Second is because it is the
service that generates the most profit and last is because a lot of
our other services are provided through the telephone line, eg
broadband services.

Input – Transformation – Output model

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Input

The transformed input recources are the customers, Information on

the forms and telephone lines.

The transforming recources are – Sales Manages, sales people,

customer care people and all equipment needed to process the
information like computers and other hardware.

Transformation

The transformation process is mailny the input of the customer

information in the system and the activation of the phone line.

Output

The output is the provision of the telephone service that the

customer enjoyes.

The 4Vs

Volume

The volume of such an operation is commonly high. But in this case

it is low varying from 60 to 70 new connections each month. This
could be considered as not so good for a telecommunications
company but since Telepassport is a small company even if the
volume is below the expected it is still the expected one.

Variety

The variety of a telephone service is low because it is a relevantly

standardized service always offered the same way. There are only
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two types of telephone lines, analog and digital, and telephony can
be done either through the traditional networks or through the
internet (VoIP).

Variation

The variation in demand is medium to low because of some

increased demand in periods like September – October or January –
February when schools open or new semesters start at colleges and
universities where the need for internet generates need for new
phone lines.

Visibility

The visibility of the service is low due to the fact that a

telecommunications company uses the front office back office
model. The customer can see the shop and have interaction with the
sales people, the customer care and the tellers but will not be
seeing the technical work needed for the telephone to work.

Lecture 2

The polar diagram

Required

Actual

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The most important objectives are cost and quality. These are the
factors that differentiate Telepassport from other telecommunication
companies, the fact that services are cheaper with high quality.
Then another important objective is dependability and that is an
area that needs improvement. But it can only be improved as the
company gets larger and more staff that can work on shifts will be
available so the service will eventually be available for 24 hours a
day.

The operation required performance is different than the actual,

each point for its separate reason.

Quality is a bit lower than the required because of the dependency

on other telecommunication companies. Sometimes the quality of
the phone calls of other providers we terminate our calls drops so
the customer feels that our quality drops.

A big emphasis on low prices makes it possible to achieve our goals

on cost.

The dependability of our service is a bit lower than required

because of the lack of 24 hour technical service.

A telecommunication service cannot be flexible as it is one mostly

standardized product. So the medium to low objective is met.

As a telecommunications provider we require our service to be of

high speed but the procedures needed to activate a phone line are
really time consuming.

Lecture 3

Process type

The process type of selling fixed telecommunication services can

only be characterized as mass service because of the
standardization of the service. The difference here is that the
volume of sales is not that big as most telecommunication
companies.

Compatibility with the four V’s

This is totally compatible with the four V’s of the operation even
though there is the problem of low volume that it should be higher.

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Telepassport Telecommunications

Product – Process Matrix

By looking at the Product Process Matrix we can conclude that the

operation falls out of the diagonal line of fit process to
volume/variety and out of pocket cost is generated. This is expected
to be solved in the future by increase in sales volume.

The operation’s overview process map

Telepassports operation’s overview process map is the Stock

Customer Operate. The way the sales people operate is the
following: The sales person tries to find customers through
telemarketing, arranges an appointment with the customer and then
the various forms are signed. Sometimes there are visits to the shop
by customers but they are not arranged or create any queues and
they are served by the idle sales people that are at the sho at that
point. If all sales people are uot of the sho serving other customers
the customer that comes in it is served by the customer care
department.

The operation’s supply network

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Telepassport Telecommunications

The operation’s location

Telepassport Telecommunications’ shop is located at a not very busy

road behind Makariou Street. It is not the best place for a shop to be
because of the very few people going around by making the
company unable to get customers that passes by. It would be better
for the company to have shops in all cities in main commercial
streets in order to attract more customers that pass by. A presence
in this kind of streets show that the company is strong and people
trust it for their services. This is of course in the plans for the future
as the company is growing. This fact though makes it easier to
operate the way we do at this point that is contacting potential
customers and visiting them at their premises. That is because we
are not at a busy road and not very much affected by traffic and the
rent there, is lower than a busy road.

Lecture 4

The operations Layout

The operation from all things mentioned can only be characterized

as a fixed position layout because the customer remains fixed at his
position (house, company) and we visit him. The process type of
selling fixed telecommunication services is a mass service. This is
not compatible with the fixed position layout as it does not allow
many customers to be processed within a specific time. This though
might change in the future as the company is growing.

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Telepassport Telecommunications

Main elements of the technology

The main elements of technology involved in selling the product are

the computer, telephone, fax, the internet and intranet, the CRM
program and the company’s database management program After
the process of selling the service and at the provision part we need
our telephone service platform, the hub and the lines rented by Cyta
to get connected to the customers phone.

Utilizing the job design techniques described in the chapter, assess

critically the situation in your selected operation. Are any
improvements needed?

The job design technique utilized by Telepassport is the division of

labour with the use of job enlargement. Each person is responsible
for more than one task needed to be done. For example one person
is responsible for the marketing of the company and at the same
time is involved in sales or another person is a technician and is also
in the customer care support.

There is a lot of room for improvement and it is actually done as the

company is growing. More stuff in order to undertake tasks that are
done in part by some others is needed.

Lecture 5

The type of scheduling adopted by Telepassport is externally

oriented. Once the order comes in the relevant forms are sent to
Cyta in order to activate and rent us the line and then we provide
the service. This is in line with the process map as we don’t have
anything ready until the customer applies for service provision.

The method of forecasting the demand is usually time series

forecasting and casual modelling. Taking into account the sales of
previous years and the events happening or are likely to happen
(e.g. the financial crisis) the demand is forecasted.

Lecture 6

Not many inventories are kept in this operation because of its type.
We offer services that are only provided when needed. There is
though an inventory of the application forms needed to be signed by
the customers. There are several types of forms that are printed
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Telepassport Telecommunications

through a print house as they cannot be printed by the conventional

printers and photocopy machines we use.

We always try to maintain a large amount of these forms at our

office so they never ran out. They don’t take much of a storing
space anyway. When any one of the four sales people notices that
the amount of these forms is becoming low we ask the sales
manager to order more.

Our main supplier is the Cyprus Telecommunications Authority

(Cyta). The phone lines that we use belong to them so most of the
services that we provide our customers are passing by their
network. The relationship between Telepassport and Cyta is
controlled and protected by the government as they are also
competitors.

The selection of the rest of the suppliers is mostly made through our
customers list. The philosophy that we use is that “if you give us we
will give you”. This happens with all the companies we cooperate, in
any department. This gives us the chance to get better prices. If
though we find better prices from other suppliers we will of course
choose them but we will again try to make them our customers as
well so the relationship will be sustained.

Lecture 7

Telepassport is not using any MRP or ERP system. The services that
we can offer are just there, maintained by our servers. The phone
lines that we use (the cost) are only rented by Cyta once the
customers ask for it. Everything from the selling of services up to
provision is done after the customer orders it. So these systems are
not something that would benefit the company.

Telepassport as a service operation is using a lean pilosophy. Stock

less production is achieved by renting the phone lines only when
needed and resources (stuff) are used to the maximum. Each person
has many responsibilities so resources are never idle.

Lecture 8

What are the characteristics of product or service quality for your

chosen operation?

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Functionality: constant communication connectivity, value adding

services (e.g. ability to be in the telephone catalogue, second line,
caller line identification).

Appearance: Premises appearance, appearance of the sales people

and of the technician that might visit the clients’ premises.

Reliability: The ability to hold a line active for the whole

conversation time.

Durability: Stability of price, services offered and of the line.

Recovery: When a line fails to work, how long does it take to be

fixed and be useable again?

Contact: knowledge of and courtesy the sales people and customer

service people.

How could quality be controlled so that to ensure operation within

the acceptable specification range?

A quality control system is not in place. What is actually happening

is that whenever there is a problem the technitians fix it. So here
are some suitable measures the company could use in order to
control quality.

Quality Variables Attributes

Characteri
stics

Functional On a scale from 1 to 10 Is the line always

ity how Satisfactory is the connected or are there
sound quality? any failures?

Appearanc Percentage of employees Are the premises of the

e with good behavior, on a company nice-looking?
scale from 1 to 10 how
clean is the service area?

Reliability What is the percentage of Does the line always

failures during a phone remain active during a
call? phone call? (or is it
interrupted during the
call?)

Durability How often do the prices for Does the phone line
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Telepassport Telecommunications

calls change? conform the quality

standards?

Recovery How long does it take from Do customers feel that

the time a problem is their problems are dealt
reported until the time it is on time?
fixed?

Contact How well treated do the Do customers feel that

customers feel? On a scale their problems are in a
from (1 to 10) professional way?

If the organization decides to implement quality controls and all

these measures are implemented, quality of the service can be
controlled in a very good manner. Some standards have to be set
(e.g. in the scales from 1 to 10, 6 is an acceptable point. Below that,
corrective actions have to be taken, above that mean the company
is performing better than expected.)

Lecture 9

The only measure for performance the operation has is a specific

number of new connections per month. That is 60 new phone lines
per month. Of cource more measures should be implemented since
we can not be sure if a new phone line would be profitable or not
since some phone lines belong to companies with a lot of calls per
month (very profitable) and some phone lines belong to houses that
very rarely use the phone lines.

A benchmark against the rest of the telecommunication companies

shows Telepassport as being far below the rest. The reason for this
difference is the size of the company as we are comparing
companies with large amounts of employees and service shops and
companies that offer more services with a small sized company with
only one service shop and few sales people.

These measures are not enough though since they don’t say much.
The balanced score board is a measure that should be implemented
since it will measure how the company performs against all
important aspects and from then on it will be a great way to get
indications for the increase or decrease of performance of the
company.

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Telepassport Telecommunications

Importance Performance Matrix

Measures 1 2 3 4 5 6 7 8 9 10

Customer
satisfaction

Quality of sound

Time from
submission of
forms to provision
of service

Cost of labor

Productivity of
salespeople

Cost of service

VoIP service
through the phone
line

Approach to improvement

The approach to improvement of the operation is continuous.

Breakthrough approach requires a large budget, something that the
company does not have so what the operation can do is to slowly
slowly grow. Of course this is not an easy task for a small business in
a market where there is a semi-governmental company that owns

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Telepassport Telecommunications

more than 90 percent of the market share but the operation has
always been trying to grow.

Lecture 10

The most urgent area of attention of the operation is the Voice over
IP service through the phone line. It is a very common service
among the clients of other companies since it allows the clients to
make cheap phone calls to international destinations. Telepassport
also has that service but the way a customer can use it is very
complicated and not very efficient. So the project will be to
implement a new VoIP system that will provide cheap phone calls to
the customers with an acceptable sound quality and an easy way of
using it.

The project objectives

In order to set our objective we need to state exactly, what is the

product we want to offer to the public and when we want it to finish.
The product will be available to the people through a specific four
digit number that they will have to dial on their telephone (This will
redirect the phone call to an internet telephone provider) and then
dial the number they want to talk to. There will be a specific pricelist
with a price for each country that will be cheaper than all standard
charges to those destinations.

Stakeholder analysis

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Telepassport Telecommunications

Work Breakdown Structure (WBS)

VoIP service
through the
phone line

Setup the system Train the

in order to Customer Implement the
support the Service people new System
service and the
Salespeople

Installation Testing

Proposed project organisation

The teams involved in the project will consist of the Sales Manager
that will be the Project manager, one person from the technical
department that is also a programmer and a person from the sales
Operations and Quality management Page 14
 Telepassport Telecommunications

department. The project will start on the first of June 2009 and will
end on the thirty first of December 2009. The first thing we need to
do is to ask for a number from the Commissioner of
Telecommunications. Then find “good VoIP telecommunication
providers through the world. Make the tests with the providers (if
the sound quality is acceptable and if it will always have available
lines). Do the available programming and activate the number to
redirect the telephone calls to the VoIP provider and test. Train the
personnel and launch the service.

Suitable scheduling of activities (Gantt chart)

Aug- Sep- Nov- Dec-

Jun-09 Jul-09 09 09 Oct-09 09 09
Ask for the phone number fom the ===
commisioner ===
=== ===
Find the VoIP Providers === ===
=== ===
Testing === ===
Programming and activation of the ===
number ===
===
Training ===
===
Launch of the Service - Trial Period ===
===
Launch of the Service - Actual Launch ===

Suitable project communication plan

Communication is really important for any project to succeed so

from the beginning until the end of the project good communication
needs to be maintained at high levels with all the stakeholders.

The first thing to do is a general meeting of the company’s

employees in order for the project manager to present the project,
select the team and split the activities.

A good communication between the project team and project

manager has to be maintained through the project and from the
project manager all of the departments and the managing director
of the company will be informed about the process.

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Telepassport Telecommunications

When the project will be close to the end (October) then the
company will need to communicate the provision of the service and
the date of the launch with the clients and any prospective clients.

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