Disruptive energy: design thinking to become the utility of the future
January 18, 2018
Once upon a time, electricity and gas were low-engagement products, all but invisible to their users. Those days, however, are long gone. Where once the Netherlands had only a handful of energy providers, now there are dozens.
<<< Start >>>
<<< End >>>
One of the key trends for 2018 is Design Outside the Lines. Identified by Fjord - part of Accenture Interactive, it speaks to the importance of moving beyond traditional design approaches. To remain relevant for modern organizations, designers need to keep evolving. Real impact requires a fresh perspective.
This Insight provides a practical example of this trend and its potential. In it, we explore the challenges Dutch utility companies face in the digital age and how Design Thinking will help them revitalize their value propositions and engage with consumers on a deeper level.
The liberalization of the energy market in 2004 and the subsequent unbundling of services have leveled the playing field, allowing new competitors like MainEnergie and BudgetEnergie to enter the fray and attack traditional business models.
They have done so with great enthusiasm, eager to capitalize on new energy trends and technologies to stake their own claim in the energy market. This, in turn, has brought change and disruption on an unprecedented scale, stirring up urgent challenges for the old guard. Consumers who want to switch suppliers can now do so easily, which has increased churn dramatically.
<<< Start >>>
Driven by frontrunners like Coolblue and Spotify, customer expectations are exceedingly high. Utility retailers are working hard to live up to today’s standards. But change requires investments. How can you measure if your efforts to increase utility customer engagement are paying off?Read more
<<< End >>>
One of the most important developments for utility companies is the advent of liquid expectations. As banks, travel agencies and online retailers succeed in creating amazing user experiences, modern consumers have begun to expect similarly impressive interactions from other companies as well. The implications are clear: if Uber can do it, if Apple can do it, if Zara can do it, if even insurance companies can do it, then utilities should be able to do it as well.
Such changes in consumer expectations seem challenging enough on their own, but they are happening against a backdrop of continuous technological disruption. Recent energy trends reveal just how much the market is changing. Solar panels are becoming cheaper and more efficient, making them an increasingly attractive investment for both businesses and consumers. Meanwhile, independent energy storage solutions like Tesla’s Powerwall and other battery packs have brought decentralized energy production and microgrids firmly into the realm of possibility. Smart meters and domotics are also helping consumers to optimize every aspect of their energy use.
The combined effects of these developments reveal a clear trend for the energy market: human-centered solutions have the floor, and will continue to dominate in years to come.
The importance of providing amazing consumer experiences cannot be understated, and new utilities are already using this insight to redefine the market as we know it. In the Netherlands, companies like Vandebron and Powerpeers have invented new ways to provide power. Mimicking platforms like Airbnb, they have cut utilities out of the transaction entirely by allowing consumers to buy electricity directly from independent producers, such as farmers with wind turbines on their land.
Established utilities are also changing their approach. Eneco has introduced Toon, a smart meter which allows users to gauge their daily energy use and control their home via a simple app. However, traditional players face unique challenges in this regard. On one hand, they lack the flexibility of startups, as they are burdened by their legacy systems, traditional processes and deeply ingrained corporate cultures. On the other, they have sizable customer bases and established, trusted names, which provide fertile ground for innovations and new offerings.
Dealing with these challenges requires a fresh perspective and the ability to test small without abandoning existing business models. Over the past years, Accenture has worked with several Dutch utilities to achieve this. We have helped clients develop new KPIs and meet them, improve employee satisfaction and roll out innovative online self-service solutions without hurting business as usual. The key? Embracing design thinking, and using it as a force for change and innovation.
<<< Start >>>
The key? Embracing design thinking, and using it as a force for change and innovation.
<<< End >>>
Design Thinking provides a holistic framework to generate these experiences. By combining the skills and insights of designers with the operational power of multidisciplinary teams, it allows energy retailers to not only create and implement sustainable innovations that delight customers, but also continuously improve them based on changing needs.
Accenture has developed a unique approach to design thinking, combining our understanding of its power as a mindset with practical and strategic design skills, industry expertise and strong technical support for implementation. This comprehensive approach has proven extremely useful in our collaborations with utilities, all thanks to five robust guiding principles:
At its heart, design thinking is all about the user. It is human-centered by definition, always focusing on the wants and needs of the people your company interacts with. This is not limited to your customers; your employees and partners are also included in the scope. Ultimately, user satisfaction is greatest when users feel fully understood. That’s why design thinking always maps out the desired user journey as well as the current user journey, so the latter can be transformed into the former. Energiedirect.nl applied this to great effect, vastly improving their user experience in the process.
The design thinking methodology invites you to leave your comfort zone and approach challenges from different perspectives. It relentlessly emphasizes and rewards creativity and openness. This not only generates more energy among the people involved, but also helps foster better, more varied solutions. In addition, the creative atmosphere inspires a culture of entrepreneurship, helping shift team mindsets into the right gear to develop new innovations together. Accenture is currently helping Essent B2B to initiate design sprints, which are a great way to explore and integrate these benefits into your organization.
Consumer expectations are constantly shifting. Taking a monolithic, one-time-only approach to new ideas is therefore unlikely to create the desired outcome. Design thinking is an inherently iterative process, which allows you to continuously test new features, retrieve feedback and improve what you already have. Instead of working for months or years, you can deliver new features in weeks and immediately gauge their real-world impact.
<<< Start >>>
Design thinking is an inherently iterative process, which allows you to continuously test new features, retrieve feedback and improve what you already have.
<<< End >>>
Traditional development cycles have a high risk of failure due to their “build first, ask questions later” mentality. With design thinking, you will never put all your eggs in one basket. Instead of targeting one new energy trend, you can target many, developing limited-scale prototypes to test with specific user groups. The insights you gain in these tests will help you determine whether the prototype is viable, whether it should be scrapped or whether its components would be of more use elsewhere.
Design thinking reaches across all levels of your organization, without locking you into a new way of doing things. It does not need to be rolled out at scale to be effective, so there are no significant barriers to implementation. By building multidisciplinary teams from the outset, it ensures a diverse mix of expertise and a high degree of motivation. Those involved will then become ambassadors in their own departments and spread the word, organically shifting your company toward innovation.
Startups may be putting pressure on profit margins and traditional business models, but established players in the Dutch energy market have good reason to be optimistic. Their size and reputation put them at an advantage, and the new energy technologies that are revolutionizing the industry have many interesting benefits to offer. Modern energy consumers long to be delighted, and there are many exciting opportunities to do so.
Design thinking will allow you to do just that: to unite your employees behind a common goal, galvanize your partners, and ultimately delight your customers in ways they cannot even imagine. It provides a fast, holistic and cost-effective approach to solving problems and developing new value propositions, all without disrupting your conventional business.
In short: if you need a powerful method to develop new value for your clients, now is the time to embrace design thinking.