1 Proprietary and Confidential Information MTIA B USINESS S TRATEGY S EMINAR A PRIL 29-30, 2013

1Proprietary and Confidential Information

CASE STUDIES IN SUCCESS: REAL-WORLD WINNERS

PRESENTER: DAVID LEWIS

MTIABUSINESS STRATEGY SEMINAR

APRIL 29-30, 2013


OUTLINE

Six crucial keys that RLECS have implemented in successfully turning their companies around:

1.Financial Analysis• LOB, 5 Year Forecast, Revenue Assurance

2.Strategic Planning3.Tactical Business / Marketing Plan

• Sales Role• Positioning the company• Purposeful pricing strategies

4.Processes and procedures5.Hiring / retraining the correct staff6.ProActive Customer Service

• Changing corporate culture


1. FINANCIAL ANALYSIS

• Line of Business Analysis (LOB) this drives everything– Revenue Assurance and 5 Year Forecast

• Strategic Planning, marketing strategies, sales strategies are all keyed off of this information

• Drives staff education on sound business practices


2. STRATEGIC PLANNING

Key strategies are all based off of Strategic Plan

•Those that are successful have an implementation process

•The Marketing Plan should research, educate, and position the goals of the Strategic Plan so management knows which strategies to implement

•Strategic Planning is only as good as the implementation

•Road map for management, keeps staff accountable


3. TACTICAL BUSINESS / MARKETING PLAN

• The Tactical Marketing Plan is a roadmap for management (especially for the marketing role)

• It should:– Include key strategies that are based on the Strategic Plan

(marketing oriented), includes budgets, penetration rates, etc.

– Positions the company (are you a Telco, broadband, or technology company)

– Strategizes “Purposeful pricing strategies”– It is the who, why, when, where of all launch plans

Marketing is different than sales…some companies require a Sales Department


4. PROCESSES AND PROCEDURES

• This is often overlooked and yet a crucial tactic when researching and launching new products

• It is sorely needed in order to meet Proactive Customer Service goals

• It is much less painful than the alternative

• It teaches discipline and accountability


5. STAFFING AND IMPLEMENTING ROLES

• Many times the reason a product / service is not successful is because there is not a role within the company

• It is not unusual that a new staff person and / or a reassigned staff person can make all the difference

• Hiring the correct staff is becoming more critical


6. PROACTIVE CUSTOMER SERVICE

• The Industry’s focus should not be on sales, it should be on ProActive Customer Service

• Your company won’t change until your corporate culture changes

• A ProActive Customer Service mindset can change your corporate culture

• A one day training event won’t change corporate culture…it is a process


OTHER KEYS

• Stop selling products and services…sell _________________

• Quit selling Security Systems and sell the Smart _________, _________, ________

• Determine what you want your image to be…and then position and measure if you are getting there

• We have to run the unregulated side like a normal business

• Educate your staff on why you are changing the corporate culture, this is the first strategy for change



PRESENTERS: BEAU REBEL


APRIL 29-30, 2013


GBT STORY

• Coop located in West Central Kansas• ILEC – 3,230 Square Miles• Largest town – 2,083 Ellis, KS• 33 Employees• 4,400 Access Lines


GBT STORY

Services– Telephone– High-Speed Internet– Video– Computer Service and Repair– Security-Alarms and Video Cameras– Cellular-PCS


GBT STORY“CHANGING THE CULTURE OF OUR ORGANIZATION”

There is no such thing as being stagnant in business. You are either going forward or backward. Processes need to be reviewed, strategies need to be discussed, opinions need to be shared, decisions need to be questioned.



Share 4 Organizational Changes– Diversification– Strategic Planning– Partnerships– New Initiatives



Diversification / Growth Opportunities– Find New Revenue Opportunities

• Vertical and Horizontal• Line of Business Analysis

– 2009 Operating Margin ($99,339)– 2012 Operating Margin $1.3 Million

» 2009 CATV ($465,000)» 2012 CATV $155,000» Lost about 600 customers 2009-2012



Diversification / Growth Opportunities– Computer Bundles– Smart Home Monitoring



Strategic Planning– Forward Looking Game Plan

• Management Team– Empower Your Employees

• Logo Change• New Motto

– The Gateway to Broadband and Technology



Partnerships– Nex-Tech Wireless PCS

• Rural Telephone and Mutual Telephone

– Video Solutions• Rural Telephone and Gorham Telephone



New Initiatives– Hiring Right

• Lost 4 Employees• Reduction of Benefits• Younger Employees

– Capital Credit Plan• Cash out 40% of Capital Credits Today• How much to pay out in future years?

– RUS Cushion of Credit– Retiring or Selling Equipment



PRESENTERS: BRAD ADAMS


APRIL 29-30, 2013


COMPANY PERFORMANCE

• Overall performance versus performance by service.

• Is your company performing financially?• If not, do you know why?• What management tools do you have in

place to adequately monitor and evaluate your operations?


COMPANY DETAILS

• Do you know your true loaded cost per service, per subscriber, per month?

• An analysis of your operations can determine your margins per service (Positive or Negative).

• Determine the reason or cause if you are not financially performing.


LINES OF BUSINESS ANALYSIS (LOB)

• Review your staffing and organizational structure.

• Review your network configuration.• Analyze / identify both direct and in-direct

cost per service.• Develop an appropriate spread to allocate

in-direct cost per service.• Employee education of internal processes

and understanding of their importance.


LINES OF BUSINESS ANALYSIS (LOB)

• Compare loaded cost to current retail rates accordingly to identify margins per service.

• If unsatisfactory margins, further steps may be required, including:– Competitive assessment– Market assessment– Implement efficiencies– Exit Strategy


LOB RESULTS

• All costs are accounted for within each individual line of business.

• Management tool identifying margins that are driving performance.

• Knowing what costs are controllable.• Operating more efficiently and maximizing

your non-regulated operations.


LOB FINANCIAL GROWTH

• GBT Communications– 4,400 Access Lines– 3,380 Internet Subs– 2,674 CATV Subs

– 2009 Operating Margin ($99,339)– 2012 Operating Margin $1,3 Million

• CATV 2009 ($465k)• CATV 2012 $155K


LOB FINANCIAL GROWTH

• Company A

– 970 Access Lines– 730 Internet Subs– 750 CATV Subs

– 2009 Operating Margin ($169K )– 2012 Operating Margin $158K


REVENUE ASSURANCE

• How confident are you that your billing is accurate?

• Do you have checks and balances in place to monitor billing accuracy?

• Has your company converted to a new billing vendor, and are you confident you are capturing all your revenues?


REVENUE ASSURANCE

• Determining what is provisioned in the network versus being billed to the customer can be problematic.

• Verifying what is provisioned can be another way to maximize your revenue.

• Diagram the internal processes to identify what two processes need to be compared.


REVENUE ASSURANCE

Once a process is implemented… – Perform the checks and balances as frequently

as needed. – Ensure employee awareness. “Big Brother is

watching”.– Maximizes revenue.

Documents

1 Proprietary and Confidential Information MTIA B USINESS S TRATEGY S EMINAR A PRIL 29-30, 2013