Step 1: Is the contract losing money BUT overall the Customer profitable?
The alert is reporting the worst contracts for the last 12 rolling months (if default). Review the far right column "All Contracts Lifetime Margin", it will show how profitable this customer is. You may be losing on this one contract, the other contracts may make up for that loss. If you are billing all revenue on one contract and the costs on another then talk to us as we believe it's very rare to need more than one contract. ID773 is a version of this report by Customer, but even if you have other contracts making up for the loss, shouldn't you still address this one?
Step 2: Drill down into the details with the CEOJuice SSRS Report ID150 Contract Profitability (Report link is in email). Contract & equipment detailed revenue/costs and additional information such as supply pages shipped versus billed. See THIS LINK on ID150 Contract Profitability Report calculations and details.
Step 3: Is there "bad data" reporting on the contract? Example a service call with 10 travel hours instead of 1-hour. Best place to quickly review this is eViews, go to "CEOJuice Contract Analysis" see this link for overview on using this eView ID555, eView to review numbers
Step 4: Decide on a plan to fix the contract: We allow you to store a documented action plan to fix the contract in eAuto, and decide on a date to review if the fix has/has not worked and until that date the contract will be "Snoozed". When the review date has passed if the contract is still a problem it will show back on this report and we will show the action plan notes.
Examples of plans: If it's a ship in and there is nothing you can do then the action plan may be "Ship in, rates locked in, review again in a year". Or if there is bad data that needs to be cleaned the action plan might be "cleaned up these invoices, voided and rebilled with correct hours, this should make it now profitable". Click here for snoozing instructions.
Important Items to Review in eAuto and accompanying alerts to help you manage:
ID768 Checklist for Contract Review:
- Do you have assigned burden rates, mileage or travel rates? Use ID63 to be informed of any missing burden rates.
- Are you checking for tech service call data entry errors? Do you have warnings/pop ups set to for excessive labor, response time and mileage in Tools/Options/Service Calls/Additional Options? Use ID219 to monitor.
- Are you reviewing service call entry? Use ID743 to review entered data (such as travel time, labor hours, call type)
- Are you linking service calls to contract? Use ID66 to check this.
- Review your call types (Tools/Lists & Codes) to ensure correctly assigned Call Type Code (i.e. jamming, error code, etc. listed as Corrective Maintenance)
- Are you linking sales orders to contract? Use ID23 to check this.
- Are you linking AP Vendor invoices to contract when 3rd party contracts are involved? An exception typically is linking ITT install fees to the contract. Typically these fees are cost of sale, not the contract. Or maybe your organization makes the install fees a cost of contract, then be sure AP is linking that payment to your contract. Please also see this National Accounts Best Practices link HERE.
- Is the bill code in equipment record a billable equipment code? Contract bill code overrides equipment bill code, so always rely on contract set up to facilitate correct billing. See ID35/ID47 on new contract set up.
- Is contract type set up correctly with appropriate % allocations based on service codes included in contract bill code? Does the same go for overage distribution code?
- Any issues with your base rates vs. overage rates being considerably off? Use ID20 and ID542
- Are your meters all billing under meter groups? Use ID293
- Are you billing base to lease company and overages to customer under one contract record? Remember that base is your revenue to offset your costs and you want it under one contract record to track your profitability. eAuto 7.1+ allows for separate base bill to.
- Are techs selling consumable items on their service calls? Use ID664 to be alert when item service code of “supply” used on service call.