In the digital age, regulated utilities face unprecedented pressures on legacy operations and business models.
Among the most urgent is the tension between consumers’ shifting expectations and utilities’ traditional approach to customer service.
Conditioned by other digital-first industries, today’s consumers are simply demanding new and more responsive services from their utilities. To meet those expectations, utility executives—already grappling with the shift to smart grids, analytics, and in some instances, competition for customers, must embrace a new, customer-centric worldview that makes the customer relationship a top organizational priority.
This shift requires new skill sets, new departments, and new ways of managing information. Acceptance of this new reality is the easy part. The greatest difficulty, as in any transformation, will be in changing the roles and mindsets of affected employees and stakeholders.
Our business and technology experts work alongside utilities every day on transformational projects. We can offer perspective on the following challenges:
Utilities face the same workforce challenges as nearly every industry—starting with the retirement of the Baby Boomer generation. There’s also stiff competition for technology-savvy workers and the delicate balance between new technologies and existing training and onboarding programs. Asset management skills must now expand to include data-driven customer interaction, satisfaction, and even advocacy, for front-line field and office employees.
Some utilities have succeeded at redefining the Knowledge, Skills, and Abilities (KSAs) of their future workforces, choosing to hire and deploy new workforces while the older generation retires. That approach can succeed if it’s applied incrementally and with significant employee feedback, starting in some of the more customer-focused departments. As an example:
In the call center, hiring can shift toward trusted-energy-advisor and holistic-communication skills rather than simple competence in call handling and issue resolution. Roles and performance measures can be split so that legacy and slow-to-adapt employees handle more traditional activities while progressive employees are assigned to new utility services and outreach (e.g., managing chatbots). This approach may run counter to the more traditional onboarding and training of new employees—but with planning and coordination, it can successfully transition the call center to a contact center in the new customer-centric environment.
Field operations will also be affected—frontline employees of the future will require more expertise with a range of operational technologies. Customer-centricity also demands incorporating a new “knowledge lineman” perspective into crew roles and job classifications. Asset managers must also be proficient with real-time data and instilled with broader communications skills that give them confidence in face-to-face customer interactions.
Utilities are already transforming their front-line workforces to operate and maintain a wide variety of new grid technologies. They are creating new KSAs for substation technicians, dispatchers, engineers, and supervisors. New capabilities also drive changes in the organization and management of these differently skilled employees. These workforce changes position utilities to modify employee behaviors and techniques, providing the necessary customer focus combined with people skills.
Real-time utility data provides information and perspective to drive day-to-day customer decisions. Just as asset management has become an integrated and data-driven focus, utilities are also seeing benefits in 360-degree views of customer interactions and services. Employees will access usage data, energy efficiency program data, work order and premise data, as well as a range of information on distributed energy resources to deliver a robust level of service and confidence to the customer.
Traditional Customer Information Systems (CIS) were built for robust billing capabilities, not relationship management. They’re being augmented by Customer Relationship Management (CRM) systems that allow office and field employees to easily access a wide variety of information on any contact, allowing them to craft a unique customer experience.
Mobile platforms and situation-specific communication scripts put customer data at the fingertips of each employee, wherever they work and whenever they need it. These technologies— integrated through a Customer Information Platform (CIP)—enable employees to resolve customer issues in real time, support front-line interactions, and add customer value.
Data analytics and trend analysis of performance, usage, and customer-owned technologies further improve the value and responsiveness of new services and programs. This integrated approach to customer-facing technologies and services provides organizational alignment and focus beyond reliable and resilient service delivery.
The successful digital utility will provide the right information to the right people at the right time and through the right technology. Balancing these factors to drive superior customer experience requires the employee at the center of these activities.
In the current regulatory model, customer service is treated as an operational expense—rather than an investment that improves reliability and smartens the grid—leaving utilities with minimal regulatory incentive to improve the customer experience. Nevertheless, utilities have recognized the current and future value of strong customer relationships and are beginning to invest operations dollars in some of the initiatives mentioned above. Some actions that regulators should consider include:
Incentives for a superior customer experience, encouraging utilities to add skill sets and employees to manage the new challenges. This is similar to how incentives and riders are improved for defined capital expenses that improve reliability and smarten the grid.
Formally measuring and rewarding key decisions and activities. ROI incentives for an improved customer experience will recognize the risks and shared benefits enhanced customer relationships. Performance-based approaches to grid operations can be expanded to include customer-focus measures.
Collaboratively develop and monitor an integrated set of customer experience goals and objectives that go beyond reliability, resiliency, and price.
There are financial risks to aggressive utility investment in such areas as additional employees, new data analytics, and cloud-based digital tools and technologies. Building the utility workforce of the future requires collaboration from regulatory and utility leaders.
These three challenges represent only a few of the many challenges facing utilities as they struggle to balance the relentless demands of asset management with customer experience delivery. As employee engagement becomes a powerful lever in digital transformation, utilities require better tools to prepare and manage their workforces.
Similarly, utilities will continue to evolve communications with customers through omnichannel engagement and analysis. Utilities will need to adopt and modify data analytics tools and digital services (similar to those used by tech giants like Amazon and Google) to match customer expectations and needs.
As utilities create new revenue streams and balance regulated and unregulated business models, regulators will develop new risk-sharing and performance-management approaches, or risk slipping toward irrelevance in a new customer-centric utility environment.
At West Monroe we have positioned many clients, including utilities, to win the battle for customers through CX transformation. Just as utilities develop numerous plans to guide asset management, they can now address many of these transformational challenges by implementing a CX strategy.
Clear objectives, which come from the CX strategy and a structured change-management approach, lie at the center of successful implementations. Managed by engaged and articulate leadership, utilities can plan, build, and operate customer-centric organizations that deliver sustainable value to customers and owners alike.