Utility Week

I t may not come as too much of a surprise that consumers have fallen out of favour with utility companies. The industry lags behind other sectors for customer satisfaction and it needs to work harder to rebuild the public's trust, says Alain Bollack, smart energy lead at Capgemini. Utilities should start by focusing on the customer experience, which Capgemini predicts will be a brand differentiator by 2020. In 2016, the utility sector was at the bottom of the UK industry ranking for reputation and ranked second worst for customer experience. "It's important to understand the needs of customers," Bollack says. "The industry is currently catching up on that, but it should be anticipating customers' needs." However, he stresses companies must ensure they do their basic job right first, before they contemplate selling new services. "The customer journey for utilities is simple but has been made complex. It should be a smoother process and the utilities industry knows other sectors are managing to achieve that," he says. The sector may not be the fastest at addressing problems but Bollack insists it has been making good progress. He notes the energy sector has taken major strides in responding to the three components of the energy trilemma: decarbonisation, affordable energy and security of supply. "There is now a clear path to decarbonisation and we are seeing an increase in renewable energy, which the National Grid says is higher than expected. "There has also been a massive improvement in energy efficiency that can be linked to consumers because of the rollout of smart meters." But one of the biggest changes we have seen this year, Bollack argues is the fact the industry is "finally starting to show an interest in electric vehicles". "Now we need to create charging stations in more places," he says. Bollack suggests the affordability objective is being addressed with customers having more choice than ever before, while new energy storage concepts are helping alleviate capacity struggles. "Competition has never been so strong and the market has never seen so many people moving suppliers," says Bollack. Although price can be a major reason for customers switching suppliers, it's not the only reason, so firms should be finding other ways to stand out from the crowd. Capgemini's recent 'The Disconnected Customer' research suggests 73 per cent of consumers may be willing to pay more for a better experience. In terms of the capacity issue, Bollack says: "It feels as though the trend for not having enough energy is now disappearing. Battery storage is not as cost efficient for customers yet, but it's getting there. All the things we dreamt about are making good progress." Despite good progress, there are still several challenges on the horizon. Bollack explains pressures on cost to serve are a challenge for the sector, but says he "wouldn't be surprised if there is an opportunity for some companies to reduce their cost to serve by 50 per cent". "We're not starting from the same position now," he says. "Companies need to embrace technology and shi" their mindset to make a more streamlined customer journey." He says companies can look to achieve such reductions by updating the customer journey and making better use of technology, drastically increasing self-service and user interaction. "Utilities didn't embrace digital technology seriously before, they do now. They have no choice." But there are longer-term challenges the sector also needs to prepare for. Not only does Bollack think the sector needs to rebuild its trust with the public, he also argues it needs to do more to attract talent to deliver its ambitions. "Innovators are not naturally attracted to utilities and go to companies like Amazon first. But how many other industries are changing quite so much? "The world of utilities has never been so exciting. We need to make it attractive to younger people." Capgemini recognises that utility companies have access to streams of data but they may not be using it to its full potential. The firm aims to help businesses not only change their business model to be more efficient for the digital age, but also helps them to implement it. "We support utility companies in serving consumers better, helping them to anticipate their customers' needs by extracting and exploiting data in a safe, secure and appropriate way. "It's great to have data, but it needs to be able to offer real value and insight." He adds: "The utility sector is going through a digital transformation, although perhaps slower than some other sectors. Is the transformation happening fast enough? I'm not sure, but the sector is catching up." Alain Bollack, vice president, smart energy, utilities at Capgemini The Capgemini interview

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