Discussion on operator network rectification cost management based on the whole process perspective

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With the development of new generation information technologies such as 5G, Internet of Things, cloud computing, and big data, human society is further moving towards intelligence, which is both an opportunity and a challenge for operators. On the one hand, seizing the 5G opportunity is conducive to exploring new development directions, finding new profit growth points, and consolidating and increasing market share. On the other hand, the huge cost investment also puts them under tremendous pressure.

Therefore, how to better control costs has become an issue that operators must think about and solve, and network remediation costs are a key area of ​​cost control. Especially with the commercial use of 5G, the number of related networks and supporting equipment has increased significantly, the difficulty of remediation has increased, and network remediation cost management faces new challenges. However, major operators generally have some problems in the field of network remediation cost management, especially in terms of project management, process management, and post-evaluation management. The authenticity and standardization of network remediation projects need to be strengthened, and the evaluability and traceability of remediation effects are still insufficient, resulting in chaotic network remediation project management and unreasonable allocation and use of network remediation costs. In this context, it is particularly urgent and important to establish a complete network remediation cost control mechanism.

1. Overview of Network Regulation Costs

Network optimization and remediation refers to the cost of materials, labor and other related costs incurred during the process of relocating, adjusting, relocating, remediating, rectifying, cutting over and optimizing (including wireless network optimization) various networks, equipment, communication rooms, network operation support systems, etc. that are in operation and listed as fixed assets. It is an important part of the operator's network operation and repair costs, and its main functions can be divided into two aspects:

First, it is to prevent major failures and ensure the normal operation of communications. The network remediation cost is a preventive investment in the network and equipment, with the aim of strengthening daily inspection and maintenance and reducing the incidence of major failures.

The second is to restore or improve its performance and improve network quality. Through continuous rectification and optimization of the network and equipment, the performance of equipment can be improved, the life of equipment can be extended, the stability of the network can be guaranteed, and user satisfaction can be improved. Its key areas of focus include major line modifications and renovations, relocation compensation, local optical cable pole and line rectification, sporadic maintenance, network optimization and special rectification. In recent years, the proportion of network rectification costs in the total network operation and repair costs has become increasingly larger. With the continuous improvement of network quality requirements, the importance of rectification costs has become increasingly prominent. At the same time, the management of network rectification projects is chaotic, and there is a lack of a full-process control mechanism and system-related means of "project establishment-approval-execution-evaluation". Therefore, it is a general trend to establish a scientific network rectification cost control mechanism, which can improve the scientificity and accuracy of network rectification cost investment and make cost control more reasonable.

2. Difficulties of the Network Remediation Cost Project

Network remediation projects usually involve multiple disciplines and fields, take a long time, are highly complex, and have many difficulties in project management, which are mainly concentrated in the following three aspects:

1. Project establishment is difficult

Due to the widespread existence of unclear needs for network remediation, namely, what kind of hidden dangers need to be rectified? How to classify hidden dangers? How much does it cost to remediate hidden dangers? The ambiguity of such issues leads to irregularities in the establishment of remediation projects, which will inevitably have an adverse impact on the progress of subsequent projects.

2. Tracking and rectification is difficult

Some major network risks, especially structural risks, generally take a long time to rectify, especially for projects involving engineering construction, cost procurement, and construction bidding, which have a long project cycle. This makes it difficult to track the project and lacks real-time supervision. Problems that arise during the project rectification process, such as irregular management and use of materials, irregular management of work orders, and safety issues, may have a serious impact on the final effect of the entire project if they are not resolved in time.

3. Project evaluation is difficult

The information of the whole process of network rectification is not rich, the data is not specific, and there is a lack of evaluation models for systematic evaluation. Due to the non-standard project establishment and the lack of tracking and control of the rectification process, there is no detailed and specific data to conduct post-evaluation management after the entire project process is completed. It is difficult to make a reasonable evaluation of the project's rectification effect and cost efficiency, which further affects the project establishment standardization of similar projects, forming a vicious circle.

3. Management and control ideas for network remediation cost projects

1. Demand Management

To address the issue of unclear requirements for network remediation projects, the following three measures are taken:

(1) Prepare an end-to-end hazard inspection guide. Organize experts in various professional fields to jointly prepare an inspection guide, clarify the assessment dimensions and evaluation standards, focus on key and difficult issues within the profession, and the connection issues between professions, clarify the inspection points, ensure that the hazard inspection is thorough and accurate, and form a unified hazard inspection standard.

(2) Establish a hidden danger database. Connect the end-to-end hidden danger inspection guide to establish a hidden danger database, incorporate the hidden dangers found into the hidden danger database for unified management, divide the maintenance demand level according to the hidden danger inspection results, ensure that the high-level cost demand is met first, and do a good job in refined information management.

(3) Establish a remediation database. The remediation database needs to be closely linked to the hidden danger database and the MSS cost system. Remediation should be carried out according to the hidden danger level. At the same time, the in and out management and evaluation of remediation projects should be done well to ensure that the remediation projects are traceable.

2. Process management

In order to solve the problem of difficulty in tracking and rectifying network rectification projects, the following two measures are taken:

(1) Work order management. Associate work orders with maintenance projects to ensure that each project has detailed construction content and workload lists, establish a complete work order management process system, and focus on the three key points of project volume, labor quantity, and work order time to ensure that remediation projects are traceable, that audits are strictly controlled, and that labor costs are reasonably controlled. Use refined work order management to improve remediation efficiency.

(2) Material management. Establish a material ledger and associate it with maintenance projects to ensure that each project has a detailed material control list. Scientifically design and manage the material collection, material use and material leveling processes, focusing on the three key points of material type, material quantity and material unit price, to improve material use efficiency and control material costs.

3. Post-evaluation management

In order to solve the problem of difficulty in post-evaluation of network rectification projects, the following three measures are taken:

(1) Evaluation of the effectiveness of rectification: Based on the network and business operation data of the rectification project, the network quality and business quality before and after the rectification are compared to evaluate whether the rectification plan and goals have been achieved.

(2) Overall cost assessment. Conduct cost assessment by profession, determine its assessment indicators and cost driving factors, analyze the reasonable range of remediation costs based on remediation data, and guide short-, medium- and long-term remediation cost allocation.

(3) Detailed cost assessment. Detailed cost assessment is conducted using two modules: labor cost assessment and material cost assessment. Labor cost assessment is mainly conducted based on labor unit price and unit maintenance workload, while material cost assessment is mainly conducted based on material unit price and unit material input. The differences and their causes are analyzed through benchmarking between projects.