Compliance Driven Cost Control for Telecom Infrastructure Operation Management

Abstract

For a major telecom infrastructure company operating pan India including the state of Haryana, over 400 of their telecom infrastructure operation sites in Haryana had connected running power load more than the load sanctioned by the Haryana State Electricity Board (HSEB). As per the Standard Operating Procedure of this telecom infrastructure company (SOP), these 400 plus sites did not qualify under load upgrade category since the load had been increased without attracting any new tenancy i.e. Base Transceiver Station (BTS) of other telecom operators (service providers). Power load at these 400 sites had increased because of additional load due to sector expansion, cabinet expansion and 3G additions.Since running power load for a BTS cannot be more than the sanctioned load, these 400 sites were non compliant as per HSEB norms. If these sites were to be inspected by State Electricity Board inspectors and identified for non-conformity, it would have lead to heavy commercial penalties and even permanent disconnection of electricity to these sites. This inturn would entail using 24x7 diesel generators to keep sites active, increasing the operation cost manifold and also threatening environment pollution.A business case was prepared for this problem using the Define, Measure, Analyze, Improve and Control (DMAIC) methodology, a Six-Sigma approach. Cause of power overload and its effect was detailed out using root cause analysis and possible optimal remedial solution was arrived at for this project. The total penalties calculated as per the HSEB guidelines came out to be Rs.35 million whereas the total expenditure being involved in complying and coming out of this issue came out to be Rs.12 million approximately, thus making it a net saving of Rs.23 million for the telecom company. It was also observed that for the sites where the sanctioned load was 35%-50% of the required load, net saving potential was more compared to the sites where the sanctioned load was 55%-80% of the required load. A similar business case was carried out by the same company in the state of Himachal Pradesh and found that net saving potential was more compared to the state of Haryana.This was practically achieved by calling different partners (vendors) to discuss this project in an open forum. Non compliant site allocation was carried out on the basis of partner's confidence, band width and operational capabilities to deliver these sites. A reward per site was declared to motivate the partners for quick achievement of the desired results (compliance) with a gate criterion of ≥80% of the total site allocation done. The partners provided power usage receipts from HSEB as a proof of job done and payments were released accordingly. The change in power load was reflected in the subsequent electricity bills. The target set for the change over to the HSEB compliance was three months during which rigorous monitoring and review mechanism was put in place including circulation of Daily Progress Report to all internal and external stakeholders. To ensure that this issue does not repeat in future, the technical guidelines (SOP) was amended in terms of the power load to be upgraded for every new asset being deployed at site.