event the churn? Churn economics involves costs, revenues, investments, and long- term stockholder value at the core of every major wireless company's financial planning process. eXcellence in Telecommunications The Telco Churn Handbook Investor Relations Liability Logically, all of these other factors cannot help but have an impact on investors and their confidence in the company. Bad churn problems and the failure to be prepared to respond to churn decisively and predictably will degrade the rating of any wireless companies. Churn problems often occur at the worst possible times, such as right before a critical IPO or refunding effort. Clearly, from almost every perspective, churn is, without a doubt, expensive. CHURN Is DIFFICULT TO MANAGE You can find churn problems everywhere in the world, but churn's pervasiveness is not what makes it SO interesting to people. No, the most perplexing quality of churn is that it is very difficult to manage. For many reasons churn can quickly make itself the biggest single problem that your organization faces. The Big Surprise The most annoying thing about churn problems is that they seem to come suddenly and without expectation. Time after time executives have related stories to us about how they were going along, doing business as usual, when one day they realized that the rate of customer churn had somehow gotten out of hand. Chapter 1 There are many reasons that churn surprises people, some of them obvious, some not SO obvious. By now, however, enough evidence has been assembled to make people realize that they should plan on it happening sooner or later. Difficult to Predict Not only is anticipating churn difficult, but SO is trying to predict how large a problem it will turn into, how long it will last, and what the ultimate consequences of the phenomenon will be. There is a certain randomness to churn that can be very intimidating to people, at least until they learn to understand it better. Difficult to Explain When your company first starts to experience churn, one o