‘Switching’ – the process by which consumers change service providers – has a number of issues that are believed by Ofcom to suppress competition. These include the administration a consumer needs to undertake (the ‘hassle’ factor), payments for early contract termination that are not exposed during the sales process and ‘slamming’, where a change in supplier is effected without consumer’s permission.
To address this, Ofcom believed that the industry should adopt a process led by the communication provider that has won the consumer’s business, supported by industry-wide processes, systems and a new ‘third party’ validation function, to check independently and directly with the consumer that the switch request is bona fide.
Our clients were concerned that the regulator had underestimated the investment and operational costs required by the changes necessary and asked David to provide an independent assessment of costs and agree to participate as an expert witness in further phases of the regulatory process. David was responsible for leading a specialist team to estimate the costs, leveraging frameworks, benchmarks and expertise to build a bottom up budget for the changes required.
Using our frameworks to ensure a complete and exhaustive design, we estimated the resources required for a programme delivery team to deliver the actions required and a entity called ‘ServCo’, to deliver customer contact services and ICT services. We considered the design choices available and chose the lowest cost way of meeting the key requirements. Thus in our design, our ServCo was to be led by a lean management team, delivering service from contact centre outsourcers and outsourced, hosted ICT infrastructure. The design included proposals for light-touch industry governance. Our work showed a significant underestimation of costs by the regulator. It enabled our clients to challenge the regulator and provided a clear way forward should they be asked to implement the regulator’s proposals.