With the emergence of big data, social, mobile, cloud and analytics are fundamentally changing the way in which we live, work and interact. These digital forces are resetting customers’ expectations and forcing utilities to rethink end-to-end customer experiences.
Ricardo Klatovsky, Global Sales and Solutions Leader, Energy & Utilities, IBM, US, points out in his presentation, The Digital Future – Imagining the Future of Customer Engagement for Energy Providers, that these digital forces are also changing customers’ expectations when it comes to the service they receive from utilities.
Customers now expect:
Instant access to information, products and services
To be treated as individuals on their own terms, regardless of location and time
Trusting and mutually beneficial relationship that goes beyond the one-time transaction
Seamless experiences that match product and service quality
In order to enhance these new expectations, company leaders are redefining their agendas and re-prioritising investments which are focused on re-shaping the “front office” or its interactions with the customer across the board.
3 Reasons why the utility has to change
It’s not only about improving customer engagement. There are also other factors forcing the utility to change its traditional business model, explains Mr Klatovsky:
Threats to revenue-Energy efficiency, slower economic growth, and new entrants can negatively affect historical patterns of demand
Information-Utilities now have to manage a huge volume of varied data from both external and internal sources with accuracy and efficiency
Consumers-Expect the same high level of service from energy providers as from other consumer-oriented companies
What does the future hold?
The traditional utility business model has been upended and must be reinvented, explains Mr Klatovsky. To remain competitive, utilities must develop new business models and alliances to sustain revenue growth.
In addition, data and analytics will need to be moved from the back office. As there will be more intensive data information on customers and assets, utilities will need to acquire appropriate technology for effective analysis.
Customers are demanding more and as this escalates, the utility will have to be more innovative in the way in which they interact with the customer. “Partner or die” has become the new mandate as new entrants reach out directly to consumers and bypass the energy provider.
Digital front office
Digital front office transformation yields business benefits and this will have an impact on consumer experience, analytical insights and operational flexibility.
It is important to understand the company as a whole and how each department interacts with the customer, says Mr Klatovsky. “Utilities have to re-imagine everything about the way in which people connect, transact and engage with companies, institutions, and governments and how they create mutual value.”
A digital front office should engage, listen, and nurture open relationships with consumers. They need to extract and apply actionable insights to interactions and processes, thereby determining the next best action for consumers.
Aim for innovativeness
The utility needs to embrace collaboration and partnerships within the energy ecosystem in order to design innovative products, services and industry business models.
Mr Klatovsky explains that customer engagement should be personalized so that communication can be more effective and valuable. The use of social media analytics as a source of innovative inspiration will create a positive brand reputation and improved customer responsiveness.
Investment in technology and customers
By improving core competency in data management and analytics, the utility will see an explosive growth in analytics capabilities. Once utilities understand the nature of the data obtained, they will see a breakthrough in product innovation and services. By investing in people and technology, the utility will be able to harness the true power of analytics.
By evaluating threats to their core revenue, utilities are able to plan a defensive and growth-oriented business model. With innovative strategies, the utility can re-imagine partnerships beyond the obvious and engage in constructive dialogue on regulatory change.
The convergence of all these changes will see a transformation in front office-systems, processes, and the people who interact with the customer. The customer will also benefit as he or she becomes empowered.
As the channels of digital front office increase and make for more efficient and effective communication, the following improvements will be realised:
Innovative business models
Improved products and services
Unified cross channel vision for customer engagement
Best class marketing capabilities
Deeper and more actionable customer insights
Supply and demand optimized to meet changing consumer needs
Increased business partner and supplier visibility
Key forces are driving a need for new customer interactions, analytics, and innovation. In order to achieve successful customer engagement, utilities will need to adjust their traditional business models by moving with the times and adopting new technology to engage with the customer better.