NewEnergy Associates teams up with SIGECO to create framework for Customer Profitability Analysis.ATLANTA--(BUSINESS WIRE)--Sept. 29, 1999-- NewEnergy Associates, pioneer in software and consulting for the energy industry, has recently teamed up with Southern Indiana Southern Indiana, in the United States, is notable because it is culturally distinct from the rest of the state. The area's geography has led to a blend of Northern and Southern culture that is not found in the rest of Indiana. Gas and Electric Company (SIGECO SIGECO Southern Indiana Gas & Electric Company ) to create a framework to accurately model and analyze the profitability of SIGECO's customers. Using NewEnergy's PROSCREEN II software application, SIGECO and NewEnergy experts were able to determine the true costs of losing existing and gaining new customers, the key to developing a sound account management strategy. Through this cooperative effort, SIGECO has gained valuable experience that will enable them to perform these studies independently in the future. This analysis consisted of two distinct methodologies, differential impact analysis and rate of return financial analysis. Differential impact analysis, as automated by the Differential Cost Noun 1. differential cost - the increase or decrease in costs as a result of one more or one less unit of output incremental cost, marginal cost monetary value, price, cost - the property of having material worth (often indicated by the amount of money Evaluation (DCE (1) (Distributed Computing Environment) Software from The Open Group that allows applications to be built across heterogeneous platforms in a network. DCE includes security, directory naming, time synchronization, file sharing, RPCs and multithreading services. ) module of PROSCREEN II, involves performing simulations with and without selected customers in place. The changes in production cost, T&D cost, market purchases and customer service cost are weighed against the revenue provided by the customers to obtain a picture of profitability on the margin. Rate of return financial analysis uses PROSCREEN II's Class Revenue Module rate class allocators to develop a picture of the investment associated with individual customers. Separate rate classes are created for each customer analyzed. In this manner, ROI (Return On Investment) The monetary benefits derived from having spent money on developing or revising a system. In the IT world, there are more ways to compute ROI than Carter has liver pills (and for those of you who never heard of that expression, it means a lot). is calculated and variations from broader rate class return targets are identified. For customers whose usage characteristics vary greatly from class averages, returns can fall well below or above global ROI targets. "PROSCREEN II has given us the framework we need to identify problem accounts and set priorities for key account management," Commented Tim Burke NewEnergy Associates is a leading provider of decision support and operational management software and consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" to the energy industry. Headquartered in Atlanta, Georgia, NewEnergy has been specializing in the development and support of integrated, state-of-the-art business applications for almost 25 years. NewEnergy currently supports over 400 software installations at more than 180 national and international electric and natural gas energy companies and continues to grow worldwide. |
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