A large Telecom company was faced with the problem of less than proportionate increase in the revenue vis-à-vis the customer base from certain regions. The revenue targets were off projections by close to $12 million. This was directly impacting profitability as there was a huge fixed cost that was incurred in creating the network in a particular region which was purely based on revenue projections made for that region. Hence, there was a dire need to look into the business problem on an immediate basis.
 

Two Black Belts were put on the task of understanding the problem and coming up with the desired corrective actions. The Black belts started the project and got hold of past one year data. Using a Pareto chart, they identified areas where the revenue realized vis a vis revenue projected was off by more than 30%. These areas were than selected for further analysis.
 

Root Cause Analysis (RCA)

After selecting the focus areas the Black Belts went ahead to seek reasons as to why the projected revenues for the reasons were not realized. The main root cause lied in the Process used by Marketing Research to project the revenues of a particular region based on factors like demography, target customer profile etc.
 

Solution Identification

The main solution lied in improving the overall process used by Marketing Research team to project revenues of a reason. Earlier process was rigid and had little flexibility in adding/deleting factors that affect revenue based on the profile of a specific region.
 

A direct financial benefit of $ 10 million was realized on an annualized basis as the result of the improvement made in the Marketing Research Process.