The value and importance of Billing Confidence Testing (BCT)
Quantitative analysis in the form of BCT is the single most powerful tool a utility company can use to measure their core operational health. It provides confidence not only in customer bill accuracy, but all upstream dependencies including market data, system functionality, integrations and more.
5 years into the UK Open Water market, we have all made big strides to improve data, iterate processes, reduce customer complaints, and ultimately improve the market.
In 2022, OFWAT reported a 19% decrease in customer complaints1; however, billing and charging issues remain the most common reason for complaints.
The UK water market is particularly challenged to provide 100% accurate billing due to the complexities surrounding complex market transactions, Enter Billing Confidence Testing (BCT)
BCT is a process that involves verifying the accuracy and completeness of the billing system, as well as ensuring that all systems are properly configured to generate accurate and complete bills for customers.
Billing Confidence Testing (BCT) the key to achieving total billing accuracy, customer advocacy and improving the bottom line.
BCT is important because:
1. Billing errors can lead to both over and undercharging resulting in lost revenue, increased complaints, increased AHT, customer contacts and more. All of which erode your margins and put you at risk of ombudsman complaints. Ultimately the bill is the gateway to your customer and errors in this critical touch point impact how your customers view your business.
2. Billing errors can lead to regulatory fines and penalties: especially if the errors are related to compliance laws and regulations that govern billing practices.
How BCT helps:
Billing Confidence Testing provides complete transparency in bill accuracy. Allowing you to identify and fix issues before they impact your customers. Maintaining a high level of bill accuracy ensures to maintain customer trust and satisfaction, as well as prevent lost revenue and regulatory fines.
Overall, BCT is a high value process that helps businesses weed out and resolve both data and system issues that would otherwise continue to negatively impact both financial and customer success.
BCT and Valytica:
Valytica has created, tested, and delivered a BCT process which allows for both one-off (e.g., Business Transformation) and ongoing quantitative analytics (Revenue Assurance) which measures overall bill accuracy.
The team at Valytica first developed their BCT process working on one of Australia’s largest utility retailers in 2015.
The Valytica BCT Process includes 3 primary steps:
STEP 1: Collating Mixed Source Billing Data
- Identifying and gathering data from all existing and future databases containing billing and billing-related information
STEP 2: Transforming & Cleaning
- Converting or mapping data formats, structure, or representation to allow for cleaning and pre-processing data, normalizing values, and encoding or decoding data
STEP 3: Large Scale Reconciliation & Outputs
- Charge level validation (for both wholesale and retail based on a series of defined rules and comparing data points to market standard sources of truth such as wholesale settlement data)
- Measuring whether a site is billing accurately at an account level (i.e., do all charges within each account pass the pre-programmed validation rules)
- Reporting accuracy results and improvement opportunities
Once implemented, the outputs of this process provide high levels of transparency on bill accuracy and key insights around continuous improvement towards 100% billing system accuracy.
Learn more about BCT and your business