Analysis of investments for new services

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  • Company: BipDate: 2009Sector: Telecommunications
  • Customer: <Confidential>Function: Management control
  • Type of project: Finance
  • My role: Project sale and execution responsible

The customer lacked an homogeneous methodology to assess and make decissions when launching a new product or service. In this situation, different set of criteria were applied when considering the feasibility of launching a new product in a given market resulting in some adequate products not being launched in some markets while other products being launched obtained bad results, effectively demonstrating that they were inadequate for those markets. Also, the heterogeneity of the analyses did not allow for the comparison of the results of the same product across different markets and therefore no extrapolations from one market to others could be made.

To improve this situation, the customer decided to launch an initiative to define a common methodology to analyse investments to be incurred in when launching new products and services, supported with a tool to be used in all the countries where the customer had operations. The activities performed were:

  • Analysis of the investment evaluation frameworks being applied at the customer, checking its completeness, coherence and consistency with the accounting standards of the customer
  • Definition of a new investment evaluation reference framework that took into account all the required situations
  • Definition of investment evaluation rules according to the reference framework, according to internal and external best practices and including required elements that allowed the comparison of analyses across different markets or countries
  • Design and development of a support tool for the methodology, based on standard office suites
  • Execution of a pilot and training on the application of the methodology and the usage of the support tool

The main benefits obtained by the customer were:

  • Improvement of the investment assessment capabilities in relation to the launch of new products and services
  • Increase of the effectiveness of analysis performed, together with the presentation and decission making on new investments
  • Application of homogeneous criteria when evaluating products across different countries
  • Definition of standard investment rules and parameters
  • Analyses comparison capability, and the possibility to monitor the actual execution of the approved investments
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