BSES Delhi: Improved Organizational Capability

Accenture helped BSES Delhi, an Indian power utility, improve performance by improving its people management capabilities, positioning the company to achieve high performance.

The erstwhile state-owned power distribution utility of Delhi was privatized by the government in 2002. BSES, now part of Reliance Infrastructure, was given two of the five distribution license areas of Delhi, and consequently formed two distribution companies in the form of a joint venture with the government of Delhi.

These two distribution companies provide electricity to 2.3 million customers and have a joint turnover of approximately US$1 billion. Since privatization, BSES Delhi has managed to achieve challenging year-on-year aggregate technical and commercial loss reduction targets set out by the government and, going forward; the company aims to be the leading utility in India.

BSES Delhi had undertaken several initiatives since 2003 to improve business performance. These efforts led to a significant reduction in overall energy losses and an improvement in customer service. However, several problems still existed:

• Rampant power pilferage by customers.

• High credit delinquency rate amongst customers.

• A stringent/complex regulatory environment.

• Ongoing post-privatization integration.

• Lack of process standardization.

• Lack of performance orientation, leading to suboptimal business results.

• Three distinctive workforces with different terms of employment.

• Silo-based operations and low transparency in communication.

• Outsourcing of customer touch points and core activities like meter reading, and customer help desks.

Management came to the view that BSES needed to ramp up its people performance to sustain the initiatives undertaken to date. This would involve addressing some of the critical people issues being faced, thereby transforming BSES to improve accountability across the organization and deliver better business results.

Accenture research into the characteristics of high-performance businesses indicates that a major business decision sets in motion an almost innumerable array of functions, people, capabilities and processes.  Realizing an adequate return on investment requires managing those factors as effectively as possible—tracking progress and analyzing the effects of any single development in the entire business ecosystem.

• Organization structure. Recommendations were made on commercial and shared services to improve accountability and performance.
  
  
• Performance management. Key performance indicators and goals for all executive positions were streamlined.
  
  
• Workforce planning for one integrated distribution company. Used the customized Work Force Planning model to assess the workforce implications and identify manpower gaps.
  
  
• Incentives and deterrents.  Designed and implemented a framework for all employees to create performance orientation and motivate ethical behavior.
  
  
• Human resource transformation. Conducted a detailed HR review, which led to recommendations for a new HR structure along with a road map to deliver on organization expectations.
  
  
• Change management. Conducted a Change Tracking survey to create a feedback mechanism for assessing ongoing change.

Phase III was designed to complement the first two phases and dealt with the following issues:

• Assistance with the implementation of Phase I and II initiatives.
  
  
• Workforce planning for the other distribution company and the shared services function.
  
  
• Organization structure.
  
  
• Definition of ideal end-state operating model for the utility.

Accenture has facilitated a significant improvement in people performance to sustain the initiatives already undertaken by BSES, and position it for further improvements in people and, as a result, business performance.

Accenture recommendations led to the following specific benefits for BSES:

• Workforce reductions and improved productivity. Accenture helped BSES reduce manpower costs—with productivity increases ranging from 10 percent to 50 percent.

• Organization structure recommendations for improved operational performance leading to faster decision-making.

• Organization road map for the future performance growth.

• Improved leadership capability.

• Enhanced management capability.

• Increased performance orientation.

• Change tracking.

• Effective cost management.

BSES Delhi is continuously moving toward leaner, more efficient and more effective operations and its people are generating more business value at a lower cost.