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UTILITY WEEK | 1ST - 7TH MAY 2015 | 7 Utility Week Live: review The Keynote conference Barry Gibbons, former chief executive, Burger King "We are drifting into an age of alienation. I'm not having it. We need a more positive age; an age of connection." Richard Khaldi, senior director, customers and casework, Ofwat "If the company is focused on regulation, it is not focused on the customer." Colin Skellett, chief executive, Wessex Water "We've got to get away from the idea that low cost means low service." Professor Cameron Hepburn, professor of environmental economics, University of Oxford "We are massively underinvesting in the pace of change." Simon Hay, chief executive, Dunnhumby "The regulator will always be behind the technology." Jonson Cox, chair, Ofwat (speaking in a personal capacity) "It is down to leaders as individuals to know the balance between what needs to be done now and what is uncertain and needs more time." Resilience Trust Change Keynote conflicts As the content at the Utility Week Live Keynote conference unfolded, it became clear that utility leaders are overshadowed by clouds of converging and opposing forces which mean decisions are being made in murky and uncertain light. Alienation v connection: As big businesses across sectors struggle to assimilate the importance of an astonishing lack of public confidence in their contributions to society, they are also being told that success in the future will be predicated on more interaction with customers. Uncertainty v ambition: Leaders must consciously assume a winning mindset to overcome sector challenges and increase competitiveness, but the shiing pressures of a changing political landscape mean they focus on reactive strategies. Consumer v voter: Utilities must rebuild trust to build the business models of the future and legitimise their investment strategies. But consumers are also voters and, thanks to toxic campaign messaging from political parties, they oen develop a "schizophrenic" position on the trustworthiness of utilities, making their expectations difficult to measure or manage. Innovation v regulation: Innovation is essential to progress. New entrants are disrupting the market and incumbents have to answer by finding ways to embrace faster- paced technology and business model development. But a "parent-child" relationship with the regulator locks so-called innovation inside the confines of continuous improvement and sets predefined outcomes, ultimately eliminating the potential disruptive innovation. The spectre of radical changes to the energy industry and, to a lesser extent, the water industry are potentially only days away. As such, you may have expected an air of nervous apprehension to loom over stands at Utility Week Live. After all, the show might have represented the last hurrah for leaders of the incumbent "old regime", before the comfortable "way we do things around here" is swept away by a new government and replaced with a fresh set of parameters and rules. Among delegates, exhibitors, visitors and those giving keynote addresses however, the view was that, after the price determinations, the regulated utilities at least have little to fear. For the energy companies of course, and the big six in particular, things are very different. There is some wariness of Labour – the only party to firmly set its sights on shaking up the energy and water sectors – but the view is that Ed Miliband would be foolish to stick his nose in and change things. It would win him few fans, especially as the companies recover from bruising price reviews. For the Tories and Lib Dems, there is little more than apathy. The assumption is that if the coalition partners return, things will continue largely as they are. But there was one voice at the event that sounded a note of caution. "It is not a case of keeping the status quo," he said. "Change is happening – the parties will just egg each other on driving change – it is just the pace of change that will differ." MB A pre-election temperature test at Utility Week Live