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MGT 3332 Summer I Team Project

Houston Lighting & Power Company (HL & P) is the largest investor‑owned electric utility in the Southwest. HL&P is responsible for generating and distributing electricity throughout twelve counties surrounding Houston. Even though it is a private company, its operations are regulated in Texas by the Public Utility Commission (PUC).

HL&P filed for rate increases of $552 million in November 1990. Consumer advocates charged that HL&P was imprudent in its spending on the South Texas Nuclear Plant Indeed, the state's appointed consumer advocate charged that part of the latest request ($360 million) was to cover the ongoing operating costs of the STNP. An attorney who represented several Gulf Coast cities in their petition against the increases questioned how much of the deferred cost of the STNP should be borne by ratepayers. Thus, it was critical to HL&P's case that the company defend and document its prudence in the management and operations of all existing electric‑generating facilities and in its providing of electric service. The public's perception of HL&P's stability and sound judgment in the daily management of its operations was critical to the outcome of the rate case. HL&P needed to show that its decisions and operating procedures were initiated with total consideration given to effectively serving its customers.

The Customer Relations Group within HL & P was of primary interest to HL&P's case preparation since it was responsible for all company activities that primarily involved customer contact. Customer Relations Group employees served as company liaisons to handle diverse customer inquiries and requests in order to establish, monitor and support continuous and reliable electric service.

There were two functions within key divisions of the Customer Relations Group that were of interest to management. These were : meter reading by the Field Activities Division, and customer billing inquiries by the Customer Contact Division.

TELEPHONE CONTACT INQUIRIES

The Customer Contact Division handled all customer inquiries by telephone. It had the largest staff of any division in Customer Relations. The Houston District of Customer Contact handled approximately 300,000 calls per month and in 1989 faced a record high call volume due to the rate hearings. There were concerns that the operators would not be as productive as an increased number of calls inundated the system and the number of operators continued to decrease. The productivity of the area had been affected and management felt that all aspects of the telephone service process should be closely examined. Staffing plan studies were undertaken to aid in determining the number of operators that should be available per month and to alter staffing plans to increase productivity.

Based on Customer Contact monthly productivity data from 1985 through 1987, the number of calls accepted by the operators met the existing productivity standard of 90%. However, management did not encourage the productivity levels of the operators to fall below 95%. Using historical productivity data to investigate changes in the productivity patterns, three values were observed:

* the number of persons calling into the system per month

(CALL VOLUME)

* the number of persons unable to talk with an operator

(LOST CALLS)

* the number of operators available per month to take calls (STAFFING)

Houston Lighting & Power, Co. wanted to apply operations management techniques to two direct customer contact areas of the company in order to effectively serve its customers. The company was obviously concerned with customer perception as it attempted to satisfy the PUC that its need for the 1988 rate increase was caused by growth that would "benefit all of [its] customers".

Period	Volume Handled	Lost Calls	Staff	Period	Volume Handled	Lost Calls	Staff
1	228204	1131	119	19	269849	8582	131
2	235195	5587	117	20	293410	3455	142
3	246118	2711	118	21	290310	3987	118
4	228310	2415	118	22	298021	4036	97
5	240003	3969	118	23	256541	2245	107
6	248124	8394	131	24	227727	2304	105
7	299402	10370	132	25	284123	10000	105
8	320670	3414	128	26	286118	9765	107
9	290796	7163	128	27	286535	2800	105
10	323757	1369	127	28	264257	1004	96
11	237100	2207	123	29	251973	7653	73
12	220566	3000	115	30	249193	8857	85
13	252896	759	124	31	302928	11727	78
14	231324	731	123	32	336895	19121	78
15	225270	1380	121	33	339904	46710	82
16	238596	1618	118	34	308410	44493	95
17	222162	1245	118	35	261026	40083	97
18	246370	1221	132	36	229846	19390	100

INSTRUCTIONS:

Your paper should be 4-6 pages long (including the Excel inserts, but not including the title page, appendix and work cited page). Submit your doc or docx file to the Team Assignment Turnitin link. You must follow the format requirements established in the Style Guide. All material taken from other sources must be cited in text and at the end of the paper. You will be penalized for errors in citation, quotation, or paraphrasing. If your paper contains blatant plagiarism, you will receive a zero for the assignment.

Required Elements/Sections

1. Title page: The title page must contain the names of all team members contributing to the contents of the paper, not just to BB discussions

2. Introduction: In this section, provide a brief description of the problem(s) as you see it/them

3. Operations: In this section, provide a high-level description of the method or methods you employed to analyze the forecasting problem(s). Be sure to indicate why you believe that the method(s) you determined to use is/are the best for volume of calls, lost calls and/or staff numbers based on data from the previous 3 years.

4. Excel Results: This section must include discussion on all Excel runs you determined to be relevant to the problem(s) you defined. All forecast model results must be embedded in this document. You can put the solution you determined within the body of the report with all others in an Appendix clearly marked. Do not submit it as a separate file. Furthermore, although the rest of the document must be in portrait orientation, you may embed Excel results in landscape.

5. Conclusions: Based upon your solution(s), will they be able to achieve productivity of 95% or higher throughout the next year? What level of staffing will this require?

6. Work Cited

7. Appendices: These should be designated by letter and titled clearly.