A few years ago, my utilities clients were just beginning to appoint chief customer officers (CCOs). It was a tangible sign they knew the utilities customer was changing (both B2B and B2C) and that the utility of the future would need to become a customer-centric organization, offering a seamless customer experience. They understood that customers who’d had a taste of tech start-ups wanted more: a relationship beyond billing; value-added goods and services; personalization; and new ways to engage.
They were right. But there’s also a bigger dynamic at play.
In 2020, an estimated US$5 trillion of overall consumer spending was already influenced by purpose. Meanwhile, the events of the last year have radically accelerated that shift, with Accenture research indicating that 55% of consumers are likely to invest more in energy efficiency today than before the pandemic.
This is also borne out in our 2021 Fjord Trends utilities perspective, with energy customers upgrading their lifestyles and embracing “do-it-yourself innovation” enabled by new services from their utilities (think home office in the garden; finally getting that electric vehicle (EV) charger; do-it-yourself solar).
And as utilities respond, and move from commodity provider to connected energy partner, the role of the CCO just got much bigger.
The utility CCO: expanding remit, common challenges
As I talk to utilities’ CCOs, they’re reflecting on their ownership of the whole customer journey—and every touchpoint within it—and articulating some common challenges.
Those challenges speak to the hugely expanding digital aspect of the CCO’s role, principally: getting meaningful intelligence from analytics, and how to scale AI and drive continuous innovation in engaging with customers.
Common issues exist at the operational level too, particularly around managing unpredictable work volumes, for instance variable customer contact needs, illuminated by the COVID-19 pandemic (we know that close to 60% of people want to talk to an agent for urgent issues).
When faced with these challenges, here’s the question CCOs ask me: what is my remit in this new world? And what capabilities do I need to be effective? In essence, I counsel them to think about four hats they’ll need to wear:
#1: Customer Intelligence Leader: Combining market, channel and customer data to make data-driven decisions and stay on top of the newest developments (i.e., having a data-led approach and methodology).
#2: Customer Centricity Champion: Elevating ever-evolving customer needs to become the dominant driver of decisions, and embedding this in everything, from marketing to field services, credit assistance and other customer service interactions.
#3: Strategic Orchestrator: Advocating for the customer in the board room and infusing a customer-centric mindset when making strategic long term investments.
#4: Customer Success Leader: Continuously assessing, measuring and improving the company’s customer service activities to increase efficiency, drive satisfaction, powered by the right measures of success.
And the relative importance of these “hats” may also shift over time.
In fact, the Strategic Orchestrator is perhaps the single most important function as we look ahead. For example, EVs and related services are likely to become a significant percentage of utilities’ businesses over the next ten years. What does that mean for the customer-related investments that are needed? For instance, in technology, AI and analytics for EV smart charging? Relationships with eMobility partners (think building owners, charge point operators and so on)?
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Customer take-up at scale hinges on simplicity and ease. But these types of investments can be harder to get across the line than the more traditional investments (such as grid reinforcement).
So where does this all leave the CCO?
Four things to think about
Every CCO I know wants to give customers a world-class experience, delivered in a cost-effective way. So what does it take to make that happen?
- Set the vision for five years from now and work backwards: Create your future vision as the starting point (rather than driving for continuous improvement from where you are now). Then roll that vision backwards to today and think about: what does that mean in terms of the business capabilities and talent you’re going to need? Being clear and bold about this vision is going to be crucial, with our Tech Vision 2021 utilities perspective indicating 90% of utility executives believe capturing tomorrow’s market will require their organization to define it.
- Make that vision sustainable: make the climate and environmental imperatives a key part of that vision. Customers want it, society needs it, and morality demands it in this “decade to deliver” on climate goals and broader sustainability imperatives. And it makes business sense, with new value for the taking where digital meets sustainability—and “twin transformers” 2.5X more likely to be among tomorrow’s strongest-performing businesses.
- Then redesign the customer service organization for the future: Take an operating model approach by creating an honest view of your organization, assessing its capability shortcomings, talent gaps, and governance holes. Compare this view with your ambition and make plans to close the gaps. Some key ones may be around skills and talent (think data and analytics skills, for instance).
- Activate your plan and drive results: Make a tactical plan to execute the transition from your current operating model to your future state. Update the business case and develop plans for risk management investment, culture. And remember to define a target governance structure and plan with initiatives/metrics to track your progress.
There is no silver bullet, but a strong (and sustainable) future vision is a good place to start.
And it’s worth the effort. Because when I talk to my clients, it feels as if we’re in a unique moment—a moment in which the CCO can step up and genuinely lead the customer future. It’s time to do just that.
Contact me to talk more about how.