Energy consumers have changed. For a start, their motivations have morphed, with more than 60% now more aware of climate change since the start of the COVID-19 pandemic, and more than half likely to invest more in energy efficiency than before.

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They want to engage beyond the meter, with 55% reporting interest in Time of Use or Flexible Tariffs and Demand Response processes. And it doesn’t stop there. Think of the emergence of the prosumer—selling excess charge from their electric vehicle (EV) back to the grid, for instance.

Meanwhile, the energy market is more uncertain than ever, with volatile pricing, sluggish demand and a barrage of new entrants testing utilities’ ability to flex.

So, what’s it going to take to manage all these factors, and thrive? The energy retailers of the future are already recognising that transformation is at the heart of future success and meeting the needs of the new consumer.

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Partnering with the right technology provider to get that transformation happening will be critical, given just how fast technology is moving in the utilities industry. To that end, SAP and Accenture have joined forces through SAP Cloud for Utilities: an industry-specific cloud business suite that provides all the key capabilities the utility business of the future will need.

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When it comes to transformation, where should energy companies focus first? Here are some reflections from the conversations we’re having on the front line.

Four industry plays for energy companies

When we speak to clients, they increasingly understand the need to place their bets; to figure out where they want to play in the energy ecosystem. As these conversations evolve, what has become clear is there are broadly four strategic plays on the table:

#1: Energy value provider: maintaining the commodity focus, with value-added perks to improve customer retention, but without the explicit goal of driving up revenue.

#2: Energy and home services provider: adding ‘status quo’ services in tandem with the commodity (think boiler maintenance, smart home services) to generate additional profit.

#3: Future-forward energy products and services: providing products and services for emerging opportunity areas like energy management and distributed energy resources, tapping into new and fast-growing profit pools.

#4: Beyond energy: moving into manufacturing, technology services related to the energy transition, and addressing other emerging needs in the new power ecosystem.

Below the headlines

Clients often ask us what these plays mean in practice, and how to plan for success with one or more of them.

For example, play #1: Dutch energy company Eneco provides value-added services as loyalty benefits for retail customers, including emergency home repair, locksmith services, and EV technical support after three months of loyalty. This extends to offerings such as bicycle assistance (after 1 year) and other more advanced benefits over time (the value-added perks).

And to bring to life play #4: EVBox (acquired by Engie in 2017) offers charging hardware and solutions for workplace, retail, fleet and home applications. With this acquisition, Engie now moves into EV charging hardware design and manufacturing, to meet customers on their own terms as their horizons broaden.

What’s striking about these examples is the new requirements for partnership models and the technology that makes those interfaces possible, as well as a seamless customer experience.

So what next?

Identifying the role you want to play in the ecosystem is the foundation for everything that follows. So once that play is identified, here are three other stages on the transformation path:

#1 Use that target strategic play to define your north star architecture, as a blueprint for the technology transformation that will be needed to make your aspirations real.

#2 Map out the path to get there, guided by business priorities. For instance, look at resourcing: SAP Cloud for Utilities enables automation of high volume back-office processes through machine learning and related technologies, freeing up resources for more strategic work. What does that mean for your roadmap, capabilities and resources?

#3 Decide what speed you can and should move at, based on existing and target technology capabilities and the roadmap to get there. 

We counsel clients to start with front office, or back office, or both. It really depends on the goal on the table.

For instance, if your target play requires you to bring customers radically new products and services (think play #3 and #4), then getting the front and back ends in place at the same time may be what it takes to offer those customers a slick experience that promotes trust and loyalty.

For example, transforming the front end is about channels (from telephone, to chatbots and everything in between), customer journey management, the digital experience, and the fuel of advanced customer analytics programs.

But to do that, you have to know your customer across all their transactions and touchpoints. And that’s where SAP Cloud for Utilities can provide that foundation, by building a unified customer profile across multiple SAP and non-SAP solutions.

Better get started then!

Accenture and SAP are partnering to make clients’ aspirations reality, bringing the best of SAP Cloud for Utilities to bear for clients as they co-create their futures. Delve into SAP and Accenture's joint perspective on this topic in more detail. And contact us to talk more about how to move forward.

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Benjamin Bender

Director – Technology, Utilities, SAP Retail Lead

Thomas Mueller

Director - GTM SAP Cloud for Utilities

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