How can energy retailers thrive in a demand-driven world?
July 14, 2022
July 14, 2022
Recently, I’ve been reflecting on the conversations I’m having with customer leaders across North American energy providers. I often come together with these industry colleagues to talk about the changes afoot, and the pivotal role of the chief customer officer (CCO) in the energy transition.
And these conversations feel particularly timely as we collectively look ahead to the pressing imperatives of net-zero, against the backdrop of a world in which patterns of energy demand and supply are changing beyond recognition. A world in which customers—both B2B and B2C—want and need connected, low-carbon services, delivered with purpose and personalization.
It’s a tall order for the utility CCO. But these leaders know surviving—and thriving—depend on putting customers at the heart of their strategy.
The colleagues I spend time with talk candidly about the new capabilities they’re building, the challenges they face and the ways they’re tackling them as they look ahead.
Here I want to reflect on the themes that are emerging, and three things I’m counseling my clients to consider.
CCOs say they’re seeing unprecedented levels of new customer demand and interest in new and connected energy solutions. And that this new level and nature of demand generates challenges for organizations in terms of operating model, culture, skills, talent and technology.
The data confirms their experience: 69% of United States (US) consumers support alternative energy development and a path towards carbon neutrality. And over the next three years, 54% of energy providers expect demand from residential customers for 24/7 renewable energy supply.
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But meeting these demands remains a challenge, with 41% of North American utility leaders citing meeting customer demand for green products and services as one of their biggest barriers to improving the customer experience, according to Accenture New Energy Consumer research.
Moreover, as CCO industry colleagues explain, the pressure is really on when it comes to B2B net-zero commitments. They believe product companies will continue to commit to more aggressive net-zero goals, and will increasingly look to utilities to help them hit those goals. It goes beyond procuring clean energy, toward a recognition of the value chain as a key lever in decarbonization.
Companies of all types now want to understand the impact of their supply (and value) chain decisions on their ability to commit to and meet net-zero targets. This means utility CCOs need to upskill themselves, and be prepared to have environment, social and governance (ESG) conversations with B2B counterparts, as part of the energy transition journey.
Accenture New Energy Consumer research backs up our discussions. While five years ago, 19% of North American CCOs said it was important to help customers meet their net-zero targets, that figure has now risen to 52%.
While the customer is top-of-mind, I’m also counseling my clients to prioritize talent and organizational change within utilities to enable those customer experiences to be delivered.
Along these lines, some questions we need to be asking utility leaders are, for example: What skills do we need to make the transition to a customer-centric enterprise? What are the key talent gaps when it comes to offering additional products and services, and personalizing for customers?
And it pays to think holistically about these challenges.
Here’s an example from my conversations to prove the point.
One industry colleague talked about new legislation driving decarbonization, that has required considerable change around the customer billing system. This means the utility’s customer operations team has to educate customers around what the new regulations mean for them, and what the impacts are to billing practices. It has a knock-on effect on late payment fees, on-bill financing and deposit norms. And all this requires agents to understand the changes, adopt the new technology in place to deal with them, know how to work with customers, and how to ensure queries are resolved in a single call.
It adds up to a complex change for agents, who will need to adapt and flex as the journey continues. And leaders know it is a stumbling block, with Accenture New Energy Consumer research showing close to 50% of utility leaders say customer facing teams’ lack of relevant skills and experience is a key challenge in providing a great customer experience, a higher percentage than in Europe, Asia Pacific or Brazil.
We are also talking a lot about partnerships to solve the pain points. And it’s something I’m suggesting to my clients they continue to keep top-of-mind.
Partnerships are one of the key levers for utilities to embrace, according to Accenture New Energy Consumer research. With 64% of energy providers saying they find it challenging to strike a balance between profitability and transforming the customer experience, partnerships may boost speed to market, and deliver value faster, cheaper.
I’m asking my clients to consider: Where do you see the greatest need for partnerships in the future? What types of companies do you need to work with to execute your vision and meet the needs of customers today and in the future?
Customer leader colleagues cite some good examples to bear in mind, for example, the need to ensure the right contractor partner is available for e.g., solar connections. Getting those contractor relationships right is essential for solar service customer scores, and clear billing for customers.
Meanwhile, eMobility is already operating in an ecosystem of partners, across automotive, billing, charging stations, and clean energy tariffs. It’s an exemplar for how partnering and industry convergence will become crucial as the energy transition accelerates.
Because in this new world, it’s not necessarily smart to go it alone.
Accenture New Energy Consumer research shows North American utilities leaders are acutely aware of this dynamic, with our research suggesting 85% plan to acquire start-ups with promising innovations, and an overwhelming 88% keen to join up with established businesses to innovate.
It bodes well for the agility and scalability that will be key to surviving and thriving into the energy transition, powered by the collaboration and leadership exemplified by my utility CCO colleagues.
Contact me to keep talking about the road ahead.