Maximizing Carrier Profitability & Efficiency

Measuring Success - Error Analysis

Following reconciliation, there are three sequential steps associated with measuring the success of the field validation and back office clean-up effort. These steps are:

1. Error Analysis
2. Financial Metrics
3. Process Metrics

While Financial Metrics and Process Metrics are discussed elsewhere on this site (click the appropriate link above to view); here we will review the concept of Error Analysis. Error analysis pertains to summarizing Equipment, Circuit and Fixed Asset errors (in both financial and ratio terms) identified between the appropriate database of record (DBOR) and the true 'As-built' configuration.

^{Table 1: Sample Error Analysis - Northeast Region}

For instance, Table 1 above displays error figures associated with a cross-section of audited network facilities within the Northeast Region. Error Impact $ totals the complete financial impact for a given category (circuits or equipment). Error Impact % summarizes the overall error rate (database vs. 'real world') with respect to equipment and circuits at the audited site. Please note: total errors CAN NOT exceed 100% and errors are not 'double counted' (which would inflate the figures).

In the example above, the Northeast Region had an overall Circuit Error Rate of 31%, which translated in financial terms as $3,175,900. The overall Equipment Error Rate was 35%, which produced a total financial impact of $2,950,900. The audit data was also used by the Carrier's Fixed Asset Accounting group to conduct a fixed asset record reconciliation. As a result of the audit, it was determined that the fixed asset record pertaining to these sites was understated by $786,200.

It is noteworthy to observe that the size of the error ratio does NOT necessary always correlate with the associated financial impact. For instance, the Hartford Hub (HARTCT21) had an 86.5% overall Circuit Error rate - but it only equaled $15,200 in financial impact. This is because, certain errors may exist in the DBOR that have little or no financial impact - other errors may be few but have tremendous financial implications. Therefore, we caution our clients to not focus solely on error ratios - but to view the error analysis in perspective with the related Financial Metrics and Process Metrics.