Terry Paulson, the widely-acclaimed author and motivational speaker once said, "Don't struggle against change; learn to use it to your advantage." North Delhi Power Limited (NDPL) did just this when it took over from the ailing Delhi Vidyut Board (DVB) about four years ago. The shift is a lesson in change management - and for NDPL, it has brought down its aggregate technical & commercial (AT&C) losses from over 50 to 22 per cent.
NDPL was the fruitition of the Indian government's decision to privatize the distribution of power in the north Delhi region. The company is a joint venture between Tata Power Limited and the Government of National Capital Territory. The JV gave NDPL jurisdiction of over 520 square kilometers and 0.9 million consumers.
DVB: Power on the Blink
Anil Kumar Sardana, Managing Director, NDPL, recalls the period when DVB was on its last legs. "The people, the processes and the premises were no better than the wreckage of a plane crash. We were asked to collect the debris and put it together," says Sardana.
DVB, according to Sardana, was brimming with gross malpractices and irregularities. Employees ensured records were not kept since these would make some of them vulnerable. Sardana also recalls how people thought IT was an infringement of their freedom - the freedom to allow middlemen and brokers to provide connections on behalf of the department and receive kickbacks.
The DVB didn't have a single good example of benchmarking against other agencies. Sardana says there wasn't even an interest in benchmarking its processes. "When we took over from DVB, I saw little or no interest within the company to adopt change management so that we could reach a point where benchmarking was possible," says Sardana.
To make matters worse, sections of the DVB ran off just two desktops, which made processes largely manual. Akhil Pandey, Principal Executive Officer and IT Advisor to NDPL, says the manual systems also opened the DVB to corruption, which made buying a power connection a punishment. "The absence of IT systems meant there weren't any controls. The errors committed in billing and payment far exceeded the limits of toleranace," says Pandey, who has been an integral part in bringing about change management.
The lack of IT hit customers hard, but it took a larger toll on the company in terms of revenue leaks. "If we go back 10 years, each utility showed losses of between 16 to 18 per cent. We labeled these AT&C losses. This means the bottom-line for us was what we collected from consumers minus the top -line - what we spent to distribute power," explains Sardana. The Transmission and Distribution (T&D) losses during the DVB regime were as high as 53 per cent.
The problem had become so acute that the NDPL couldn't find an error-free and tamper-proof billing software that would plug the existing malpractices. "The average error rate in billing in most developed nations is three-to-four per cent. When we took over from DVB, it was over 30 per cent - all because of a lack of a proper IT infrastructure," rues Sardana.
DVB to NDPL: Starlight to Sunlight
The NDPL was tempted to attack the problems of dilapidated infrastructure and the inherited losses of 52 per cent head-on, but it realized that its first goal was to build trust among its consumers. This meant ensuring as few electricity failures as possible. It also aimed to make power affordable. The NDPL's top management figured that without an effective and 'forceful' use of information systems, they wouldn't be able to achieve any of their goals.
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