Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government
Issue link: https://fhpublishing.uberflip.com/i/507450
UTILITY WEEK | 8TH - 14TH MAY 2015 | 7 Interview U tility Week meets Johanna Dow fresh from leader- ship training at the London Business School, in the chic cellar bar of a Mayfair hotel. We order wine to avoid the anathema of bottled water. Dow's still full of optimism about the insight and exchange of cultures with peers on her course. She talks about the eye-opening experience of studying with individuals from a swathe of sectors and nations, and is keen to soak up the opportunity. She is less than six months into her job as CEO of Business Stream, a position she gained amid widespread interest following the rather sudden abdication of prede- cessor Mark Powles for reasons unnamed. Furthermore, it will soon fall to Dow to lead her Scottish force south- ward, for an aggressive foray into the English market when it opens to non-domestic competition in 2017. But Dow's eagerness to learn should not be mistaken for "freshness" or lack of confidence as a leader. She's cool and considered in answering questions about the strategy and ambition of Business Stream as the date draws closer for market opening – and she's not sitting by while the structure for that market is developed. Although she's relatively new to the chief executive's chair, Dow has been busy making her opinions and experience heard by Ofwat on key issues such as company separation and margin setting. Read her CV, and you'll see that Dow's experience and knowledge, of the challenges that attend organisa- tional change and the opening of monopoly markets to competition, are robust. She worked for SSE when it materialised from a merger between Southern Electric and Scottish Hydro- Electric in 1998 – just prior to the opening of the UK electricity market to competition. From there she moved to Scottish Water, keen to take up the "fantastic opportunity" of transferring her know- how to another new beginning for competition, and she was closely involved, from concept to fruition, in the set- up of Business Stream. "There aren't many times in your career when you will get the opportunity to do that," she reflects. And it's le her "an absolute passion for the business because I have been there since day one". That long experience hasn't made Dow into a fossil, though. She's keen to see the company continue to evolve and therefore offered an ideal mix of continuity and fresh vision when the need to replace Powles arose. And why did it? Dow looks weary as she answers the inevitable question. "Mark had been with the busi- ness for seven years. It really was just a question of the time being right for him to move on. If you look at most organisations, seven years is a long tenure for a chief executive." So it was his decision? Dow nods and reiterates, "As I said, the time was right. Both for Business Stream and for him." Dow is understandably keen to move the conversa- tion on to the future and play down the disruption caused by a change in leadership. "We're around 300 people now – it's much bigger than one individual – we've just carried on. As a busi- ness we are incredibly ambitious and focused on growth both in Scotland and England." Recent financial reports show that ambition is bring- ing home the bacon in Scotland – despite Business Stream being required to actively support loss of market share in order to prove competition is healthy. Profit before tax in 2013/14 was £38.3 million – an increase of £3.0 million from 2012/13 – with revenue in the year, aer discounts to customers, having increased by £2.7 million to £364.2 million. And with this firm financial base and seven years of competitive experience under its belt, it's safe to assume that Business Stream's bullish talk about the English market is far from idle. Dow confirms that the company is ready to "seize the opportunity with both arms". It's already talking to potential customers about the benefits they could receive and building a broad-based strategy for customer acquisition that includes scope for buying customer books from companies exiting the market. But amid that excitement and ambition, Dow also has some concerns about the way the market is shaping up. These concerns centre around three key points – level playing field, standardisation and retail margin. Giving more detail, Dow explains, "There's lack of clarity on these points more than anything, but we're really keen to be sure that we have a fair market that is able to deliver benefits for customers and to encourage new entrants. "We want to be comfortable that everyone will be able to compete from the same basis as the incumbent retailers," she continues. "So, if I went back to the time