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“I was amazed at what I saw in Quantrix. This was the exact solution we needed.”

        - Johnny Rossing, Controller

Tele2 is Europe’s leading alternative telecommunications service provider with operating revenue of over US$7 billion. Headquartered in Sweden, with divisions throughout Europe, it has a growing base of over 30 million customers in 22 countries. The Danish operation had an operating revenue of US$230 million in 2005 and provides more than 600,000 customers with services such as mobile telephony, Internet services and traditional fixed wire telephony. Tele2’s mission is to deliver the best prices in the market for telecommunications services.

The Challenge - Forecasting Revenues and Tracking Broad Range of Costs

Defending price leadership in the highly competitive telecommunications market is no small task. In Tele2’s case, it requires agile business planning with highly accurate customer demand forecasting and detailed tracking of all internal and external costs and overheads. Tele2 organizes its business along product segments. To complicate matters, each product segment has multiple sub-segments which in turn have multiple product lines. Furthermore, Tele2 contracts with vendors to serve customers outside their networks – adding another layer of complexity to managing cost. It is important to anticipate which customers will be on Tele2’s networks or on supplier networks as the cost structures are different. Business decisions and pricing policy are necessarily data-driven and even the smallest inaccuracies can have a big impact on competitiveness and the bottom line.

Tele2 spends considerable time and expense on business planning, but the complexity and dimensionality of their operations pushes the spreadsheet models beyond their capability. The marketing group is responsible for entering the customer growth forecasts while the finance group supplies costs and validates the models. As in most organizations, marketing professionals are generally not heavy spreadsheets users and there is always the risk of introducing error into the models. Johnny Rossing came aboard as business controller at Tele2’s Denmark division to examine how to best address these issues. He quickly recognized the need to ‘think outside the cell’ and implement a better solution.

The Solution – Multidimensional Forecasting and Cost Analysis with Quantrix
Rossing discovered Quantrix while researching business planning software on the Internet and downloaded the 30-day Free Trial. “I was amazed at what I saw in Quantrix. This was the exact solution we needed,” said Rossing. “I had previous experience with applications from Cognos, Applix, and Paris Technologies, but none were the right fit for this purpose.” He took advantage of the on-line training resources and was able to quickly develop competency with Quantrix. After Rossing converted Tele2’s spreadsheet models into Quantrix, the finance and marketing groups were able to experience the benefits of multi-dimensional modeling. With a simple click of the mouse, they are now able to view the forecasted customer growth and associated costs by geography, product segment, sub-segment, product lines and a multitude of other dimensions. In addition, the automated validation features of Quantrix reduced the risk of introducing errors into the models. Rossing also has strong praise for the assistance he received while developing the models. He characterizes Quantrix Customer Support as “…world class support measured on three parameters: prompt reaction to all emails to support, understanding of the customers’ problems, and very useful solutions.”

The Result – Tele2 Maintains Price Leader Crown
Remarkably, Tele2 experienced a 10-fold improvement in its ability to track and manage overhead costs. This ‘cost awareness’ puts Tele2 in a much stronger position to negotiate lower prices with vendors and ensure acceptable margins. It has also improved Tele2’s competitive edge. With precise knowledge of earnings-per-customer in product segments, Tele2 is able to offer customized pricing to customers in highly competitive, price-sensitive areas. Rossing is enthusiastic about the results of Quantrix Modeler and looks forward to broader deployment within Tele2. He sees Quantrix as an important asset in helping Tele2 maintain its position as a leader in the Danish telecommunications market.

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