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Management 4 Pages

Houston Lightning And Power Company

Question

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".

PeriodVolume HandledLost CallsStaffPeriodVolume HandledLost CallsStaff
12282041131119192698498582131
22351955587117202934103455142
32461182711118212903103987118
4228310241511822298021403697
52400033969118232565412245107
62481248394131242277272304105
7299402103701322528412310000105
83206703414128262861189765107
92907967163128272865352800105
10323757136912728264257100496
11237100220712329251973765373
12220566300011530249193885785
13252896759124313029281172778
14231324731123323368951912178
152252701380121333399044671082
162385961618118343084104449395
172221621245118352610264008397
1824637012211323622984619390100

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.


Solution

Title: Houston Lightning And Power Company
Length: 4 pages (1160 Words)
Style: APA

Preview

Houston Lightning and Power Company

Houston Lightning and Power Company generates and supplies electricity in 12 counties located in Houston. The Texas Public Utility Commission regulates the operations of the company. In November 1990, the company filed for a request to increase its rates to $552 million. However, the company’s expenditure on the Nuclear Plant in South Texas was termed as imprudent by the consumer advocates. The advocates further claimed that the request made targeted at using $360 million from the $552 million in covering the costs of operations at the nuclear plant. An attorney representing the cities in the gulf coast in their petition against the increasing the allocations questioned about the amount of money that the taxpayers would bore.

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