I had the amazing experience of chairing last week’s Future of Utilities conference, hosted by MarketForce, in Central London. This is a flagship event, featuring a fabulous selection of inspirational speakers sharing their formative insights and experiences. Julia Davenport spoke about the potential of Peer to Peer energy training, Our Power, Robin Hood and Bristol Energy all shared the power of energy as a social enterprise, and Bulb led on the power of communication.
It was an incredibly positive environment, and there is a genuine feeling that the industry is on the cusp of an exciting change. However, I got the strong sense that much of this sense of ‘excitement’ is waiting for the smart meter rollout deliver and that there is too high a reliance on smart meters and the data they will provide. Whilst accurate data of the level that smart will provide will indeed be transformative, we’re a long way away from getting the penetration of the market with smart that will make a big difference. It could potentially take another 5 years to get 90% of the UK onto smart, and by that time, existing industry participants could well have missed the boat.
We all know that the technology world moves fast and that the energy industry typically takes a more glacial pace! There is a very real risk that the ‘data giants’ such as Amazon and Google could make a move in energy – and sweep everything out from under our feet if we don’t pick up the pace ourselves. We need to move beyond technology for the ‘early adopters’ and start to develop compelling, data-based, propositions that will deliver genuine value to the majority of the population. Whilst ‘digitalisation’ is very much the latest buzzword, we ignore it in the energy sector at our peril. We need to transform this very much analogue industry – and do it fast….
Which brings me onto the thorny subject of trust. It’s going to be very tough to deliver this level of ‘transformational change’ without trust from customers. And with the context of an industry suffering from its own challenges – with two energy suppliers falling out of the market whilst the conference was running – how do we deliver change against a background of lack of trust?
What is clear is that business models have to be sustainable. Companies can’t just ‘stack it high and sell it cheap’ because with volatile markets this is only going to end badly. Many customers are being won over by the new brands that offer tech-led servicing options and open communication styles – but this all needs to be backed up by a solid business model that can deliver excellent customer service, whilst keeping operational costs as lean as possible. And it will take more than a few companies doing it right to change a long-term negative perception of the industry built up over many years. We need to go back to basics – look at the language we use, and how we make this complicated business easy to understand for the end users, otherwise, we can install all the smart meters we like, but we still won’t get consumers to engage.
So what’s the secret recipe? I wish I knew – but the starting point has to be having a clear strategy about the markets and products you want to target, making sure that your back-end systems, processes and people are set up to deliver operational excellence, and having open and honest communications with your customers.
If you want to find out more about how using your people can better deliver operational excellence within your business, get in touch