Profitability analysis of customer proposals

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  • Company: BipDate: 2011-2013Sector: Telecommunications
  • Customer: <Confidential>Function: Management control
  • Type of project: Finance; Strategy; Commercial
  • My role: Project sale and execution responsible

The customer, the branch from an global telecommunication services operator focused on providing services to multinational clients, lacked a way to assess both in a global basis and a local basis the profitability of the proposals made to its end clients. Thus it required the definition of a model and a corresponding support tool that would help in the proposal profitability assessment during the commercial phases, and in the financial follow up of the project if it was eventually won and has to be implemented.

The main activities performed as part of this project were:

  • Modelling of the financial assessment process applied by the customer when preparing proposals for multinational clients
  • Identification of the data to be obtained from the local proposals (one from each country where services had to be offered) to allow its analysis at a later stage
  • Definition of the financial model for the central services that could be offered to the end client (central billing, central support, etc.)
  • Definition of alternative allocation algorithms to spread the contral cost services across local operators
  • Identification of monitoring metrics for the project from the financial point of view
  • Reports definition
  • Functional design and development of a support tool for the whole process (based on standard office suites)

After the project execution the customer reached the expected objectives, together with the following additional benefits:

  • Creation of a central database for local services prices
  • Creation of a database of proposals prepared for multinational clients
  • Implementation of a standardised process to analyse discounts, margins, costs distribution and other commercial aspects
  • Introduction of specialised roles to assess the financial soundness of proposals for multinational clients
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