Case #749

$30 million provider of leasing and maintenance on lighting service

The typical “12 months and over a million dollars” approach to implementing a new system does not work in a turnaround situation. Instead, a critical element of a successful turnaround is a flexible systems solution that is implemented in weeks, not months, and at a fraction of the cost of a typical new system.

Work for a lighting service company presented our systems crew with some interesting challenges. Our client was a lender that had financed a portfolio of equipment installation and maintenance contracts that required ongoing maintenance-performance success. Despite its $30 million in annual revenues, the company that sold the equipment, wrote the contracts and maintained the installed equipment was going through bankruptcy. And now, many contracts were in jeopardy because of maintenance performance problems.

Our crew was asked to create a new company, which would provide the required equipment maintenance once the lender was able to gain control of its collateral through Bankruptcy proceeding. We had to take over the servicing of 10,000 physical locations in 40 states and to process more than 150 requests for service daily. This operation had to be in place within 60 to 90 days and be ready to begin handling service requests on as little as 2 days notice.

Our analysis of this situation revealed some difficult problems that would have to be overcome:

• The system that was used by the current maintenance provider was outdated and no longer supported by the software company.
• The existing system also operated on a non-supported version of a database that was no longer available.
• The existing system was not Y2K compliant.
• The company operated three primary software applications for its operations and each application was an “island of information.”
• The existing customer, contract and service databases (the three applications) had an extremely high rate of duplicate and incorrect data.

Our crew looked at a number of alternatives and found that any “off the shelf” software that could handle this “complex and data intensive operation” would take at least 6-12 months to implement and cost in excess of $1 million dollars. We also found that these package systems did not provide the tools or flexibility we needed to analyze and cleanse the corrupt data we had to work with at the onset. It was clear that we had to create our own solution and it would have to have exceptional data-analysis capability, flexibility, and be capable of being completed in less than 60 days.

The first step was a business analysis of the operation. We identified the data and processes that were critical to operating this business. Within a week, we had completed the design of our new database and identified the basic functions that our new system would have to support. This gave us the basic blueprint for building the new system. We also mapped future data and application needs of the business, because we wanted the new system to be flexible and allow us to easily add new features after we had completed the initial startup.

We had to find a way to build and test a complete system in less than 60 days. This would require careful selection of the right database and software tools that would be used to construct the new system. Most systems development efforts take months to complete, so this project had to rely on the use of technology that could cut that time to weeks or even days. The success of this operation would also hinge on our ability to analyze large volumes of data quickly to identify problems and determine corrective strategies. In short, we had to have a technology base that would allow us to “slice and dice” data in a wide variety of ways.

Two crews immediately began the task of building this system. Critical data elements and relationships were identified and we began moving data into an analysis database. We constructed tests to determine data accuracy and started the process of “cleansing the data.” The first crew then built our permanent system database and the process of data conversion began.

A second crew began the development of the application software. We had several objectives for the new system. First, it would have to be very easy to use. At startup, we would have very little time to train new employees before full operations began, and the design would have to support a high level of efficiency, because our goal was to run the operations with a very limited number of staff. We also needed to have key performance reporting from the first day. If anything were going wrong, we would have to identify the problem immediately and take corrective action.

The system was completed within 60 days. When the existing maintenance provider closed their doors, we were able to transition the operations to a totally new company “without one day of lost customer service.” The speed with which we completed the startup helped stem the tide of contract-default notices and stabilize the customer base (and the contract payment stream) in a very short time period. The system has now been enhanced to a level that makes it “State of the Art” for this industry, and it has been accomplished at one-fourth the cost of off-the-shelf alternatives.