Improving the Customer Experience in the Utilities Industry

PA Consulting’s utilities expert, Marc Tritschler, discusses how utility companies can develop a customer-centric culture by leveraging data more effectively.

The report analyses how providers of water, electricity, and gas have long lagged behind other industries in delighting customers, owing largely to monopolistic roots, cultures, and processes that did not need to focus on offering a compelling customer experience (CX). However, increasing competitive, regulatory, and stakeholder pressures and rising customer expectations are changing these traditional models, leading utilities to prioritize CX in ways they never have before.

While a customer-centric approach is becoming critical across all industries, utilities find their traditional siloed operating structure to be particularly out of step in a digital age. Changing customer demands and expectations, intensified by a forced migration to digital experiences and remote work because of the Covid-19 pandemic, are making that discrepancy even more apparent.

The types of disconnects, such as various utility departments not sharing customer data effectively, are common throughout the utility ecosystem. Marc says: “If a customer makes an appointment for a field technician to clear out a sewer blockage, they often can’t go to a website later to make a change in the time if they need a different appointment. They have to call the utility provider on the phone again and repeat a lot of information because the agent may not have access to the detailed case and appointment data. By modern standards, that’s not good enough.”

Marc cites one recent example of poor data impairing CX: When a friend moved into a new house and received a £400 water bill for the first month—an obvious error—the utility’s customer service agent could not sort the situation out and instead recommended the customer pay the full bill, which the utility would eventually refund.

He adds: “For a utility to think it’s acceptable for a call agent to say something like that to a customer is beyond belief. However, the utility was so constrained by its current processes that this was the only approach the agent felt that they could offer the customer. That is definitely not being customer-centric. In some places, utilities still feel they need to make customers conform to their processes, instead of understanding what the customer wants and shaping the processes around the customer expectations.”

Stakeholders around the world are seeing that a growing number of options for customers heightens the need for better CX. In the various regions of the U.K., customers cannot choose their household water service; one geographic monopoly provides the water. This arrangement might pose the risk of the monopoly water provider giving short shrift to CX because customers have no other options.

But even here, providers are getting motivated to focus on CX. Marc says: “Regulators are driving hard for water companies to improve the customer experience.” The British water regulator recently reinforced its CX metrics to have a significant impact on financial rewards—or penalties—to which the companies will be subject. “They cannot recover these penalties through customer charges, so there is real money at stake,” he adds.

CX is complex and nuanced. Marc sees the ability of utilities to provide information back to the customers as a fine line: People want insights and valuable advice, but they don’t necessarily want to wade through every piece of data about their energy usage. Even as utilities introduce smart-metering information in the U.K., Marc says: “The information has to be packaged in such a way that people will want to engage with it.” Customers may be able to access their data from a display on a device in their home, but if that data is not viewable on a mobile device or offered as a download, there may be less take-up and, critically, less behavior change as a result. “It’s not just about provisioning the data to the customer,” he adds. “You can democratize data to the customer, but they won’t use the data if you don’t take the customer experience into account.”

Read the full report in Harvard Business Review