According to a 2018 IDG survey, just seven percent of companies reported having completed their digital transformation efforts, and only 11 percent said they had yet to begin. That means that the vast majority of companies – around 82 percent – are somewhere along the digital transformation path.

Wherever you and your organization may be, you likely face a multitude of pressures to “go faster.” Understanding that those pressures are very real, the utilities that are leading the industry in digital transformation have prioritized organizational alignment over “speed at any cost.” They understand that a digital transformation is fundamentally a transformation of the business itself, and a few extra cycles of strategy and planning between IT and business leaders can make a big difference in terms of a lasting, positive impact on a utility’s customers and business.

A common problem is for companies to swirl in an endless loop of doing “digital things,” rather than making the necessary changes to business, operating and customer models. Many companies approach digital transformation as they might approach a new enterprise resource planning (ERP) system implementation — as a zero-sum, big bang project. But a more realistic approach is to look at digital transformation as a series of steps, grounded in business and customer value, that form a prioritized roadmap of digital initiatives.

Where to start

While each energy and utility company is different, successful transformations focus on customer value. Ask questions like, “Do we know why our customers value us?” “How can we make their experience more engaging, more trusted and more delightful?” And, “How can we create more differentiated value for existing customers and acquire new ones in the process?” Begin by identifying the areas most critical to your customer relationship goal; then layer on your priorities for increased operational efficiency. Focus on making workers more engaged and productive, creating better customer experiences and opening up new revenue opportunities.

Building on a customer-centric intention, an important first step is to define what digital transformation looks like to the company so that every employee can understand why it is important. With that, it then becomes imperative to ensure the executive team is fully onboard. And, before significant change begins, the organization needs to decide how success will be measured. Taking a holistic, customer-centric approach and considering strategic needs across the business is ideally step one. Defining the vision, guiding principles, strategic roadmap and success metrics can then guide program funding decisions and system selections. The key is “thoughtful transformation.” This foundational work, when conducted with transparency and collaboration, aligns organizations around a common roadmap that can save countless cycles later in the journey. If you didn’t start this way or don’t feel you have your strategic roadmap fully baked, it’s worth pausing to get the organization aligned.

Equally important is the need to rationalize IT infrastructure and to reduce the cost and complexity of systems and architectures that were designed for another era. This is not to advocate wholesale “rip and replace.” Instead, look hard at existing legacy, custom and vendor applications and assess their potential to support incremental change. In particular, evaluate platforms that support the transformation of customer experience, engagement and CRM – the most rapidly changing aspects of customer operations. Often, changing or introducing front-office engagement platforms is a lower risk way to preserve and extend the life of back-office investments because you can accelerate incremental “quick wins” that positively impact customers.

For example, digitally transforming the front-office employee experience, while simultaneously improving customer experience in a few high-traffic channels or highly desired but not yet offered self-service channels, can return significantly greater value quickly, across key metrics like call deflection, first call resolution and customer satisfaction. Aligning guiding principles, roadmaps and key success measures across your contact center and customer web/digital teams will guide you to the right places to start. This roadmap will also guide you in selecting technology partners that meet today’s pressing needs and support the long-term vision of both the business and IT.

With a strategy aligned around prioritizing customer and efficiency drivers, an energy company can build a strong, flexible, layered approach to smart investments that transform IT and the business.

Staying valuable and relevant requires action now

Utilities are crucial players in today’s smart, connected world. While the utility industry is undergoing profound disruption, it is also operating from a position of strength, for now. Utilities are well-versed at managing change, based on decades of adapting to new methods of energy production, distribution and consumption. They are leaders in IoT and systems monitoring. Likewise, the utility sector has made strides in its ability to harness new technology platforms and data to improve performance continually. And while the capital-intensive nature of the business brings with it an outsized legacy profile in terms of plants, equipment and systems, many companies nonetheless are making incremental or wholesale changes to implement better and smarter ways of working closer to the customer; whether it’s improving internal processes or enhancing interactions with customers and prospects.

Today’s consumers – whether residential, commercial or industrial – shop and buy as they do on Amazon – i.e., they want personalized services and high quality, seamless, omnichannel access. Digital is their preference, but they expect human interaction when necessary. They want choice, but also guidance and reassurance from data and their peers. They want their needs met seamlessly, or they will quickly click away, and often, take their business elsewhere.

Digital transformation is the way for the industry to move from statically providing the simple undifferentiated products of the past, to dynamically offering valuable, sophisticated personalized packaged solutions and services that put the customer first. The companies that quickly embrace these opportunities will continue to lead, grow and redefine how their relationship with customers and stakeholders.

As new entrants look to disrupt the status quo further, utility companies will be able to drive growth and greater margins by offering a range of bundled products and services, personalized to the individual customer. Utilities can thus leverage their established, traditional brand equity while also delivering truly valuable services that sustain and increase customer satisfaction.

Address present needs – but with an eye on the horizon

One major UK-based gas and electric retailer took just such an approach. The company needed to act quickly to acquire new, high-value customers. They started their customer digital transformation by replacing legacy processes for pricing, sales and quoting within the large Industrial & Commercial (I&C) business division, aiming to reduce dramatically the time from lead to quote. As part of this initiative, they implemented a utility industry-specific customer engagement cloud platform and deployed the first key modules for the I&C business in record time. With this new platform in place, as well as various enhancement to related business processes, this gas and electric retailer has accelerated time to market for new offerings and is meeting the rising expectations of its business customers. Initial results highlight a significant improvement in end-to-end process times, with customer quotes that previously took three days now taking less than three minutes.

Also of note, this gas retailer chose a cloud-based solution that is highly configurable and intuitive, reducing training time and operational costs. The system was rapidly integrated with other existing systems and is on a platform that allows the company to switch on new capabilities as its business transformation continues. The nature of an agile platform, deployed by an IT team skilled in agile methodologies, allowed for the project to go from start to first go live (configured, tested and deployed) in just 14 weeks!

Rapid success in one area of the business has made other business units and divisions of this global company sit up and take notice. Achieving the initial aims of the I&C business catalyzed customer digital transformation across the organization and sped the pace of change initiatives in sales, marketing and customer care across the UK organization and even the global the parent company.

B2B and B2C

The story of a major B2C retail energy provider in France is another example of a multinational company well on its way to transforming its business model and processes to better align with today’s digital-savvy customer base. The parent company, one of the largest global energy group holdings, sought to be a leader in the low-carbon energy transition space and was looking for ways to further develop its client portfolio, reimagine its customer experience, diversify operations and elevate its client relationships in the B2C and B2B spaces. Foremost among its goals for B2C was a desire to provide an omnichannel customer engagement platform that supports the deregulated French energy market. They needed a platform that could rapidly accelerate new retail energy offerings and a partner with the industry focus to help them innovate in the energy industry. Additionally, the new engagement platform would have to integrate with multiple existing legacy systems, preserving these back-office investments, while transforming the front-office and enabling a true Customer 360-degree view.

The company chose a cloud-based, omnichannel customer engagement platform, built specifically for the utility industry and capable of scaling to support thousands of digital users initially, and millions of users in the not-too-distant future. For its French company, the global retailer is taking advantage of an agile implementation that leverages key industry accelerators, including an industry data model to integrate with existing back-office billing systems; new, simpler user interface screens and guided processes that optimize information gathering in multiple relational databases.

The result is an integrated and robust cloud solution that is streamlining internal processes and that is built on human-centered design principles for a great user experience. The company is realigning its operations to focus on efficiency and providing value to generate new revenue opportunities across the business. It is also transforming its contact centers and self-service capabilities, accelerating its time-to-market for new offers, and reducing cost to serve. All of this is achieved through its adoption of new digital agent consoles featuring guided sales and services capabilities. This 360-degree view provides agents with all pertinent customer information, including a holistic view of payment and billing, interaction history and energy and service offers. It also greatly reduces the number of clicks needed to update or change contact and premises information.

A similar story is unfolding at a number of large North American utilities. In one example, a major utility is looking to transform customer care capabilities, though currently, they are heavily dependent on inflexible legacy customer information and billing systems. Service agents have limited information on critical issues such as customer contact preferences and must consult multiple systems and screens to address customer queries. (The industry calls this “swivel-chair” service, and it’s enough to drive agents a little bit crazy.) Not surprisingly, excessive call handling times, repeat calls and chronic customer dissatisfaction are the norms.

The good news is the utility is currently implementing a system-wide consolidated agent console providing a 360-degree view of customers. Already, the company is seeing shorter call times, better first call resolution metrics and overall improved customer satisfaction. Again, it is all made possible by a dedicated utility, industry-specific cloud solution featuring best-practice, intelligent and personalized contact center processes for resolving the most common issues. This initial install will be followed by digital, mobile-friendly customer self-service capabilities, as well as the addition of marketing and next best offer functionality. By taking incremental steps, the utility can manage its digital transformation at a steady pace without losing focus on other critical operational issues.

Bigger and better in Texas

With more than 1.7 million customers, the final utility in our story had more than 100 competitors in the Texas marketplace and was steadily losing customers a decade after the state first deregulated the industry. The utility recognized it needed to reinvent itself and prioritized strengthening its brand, developing and marketing new innovative and differentiated electric plans and significantly elevating its customer experience.

The utility saw digital transformation as the way forward to competitive differentiation. It also realized this as an opportunity for it to improve customer acquisition, retention and margins, increase operational efficiency and optimize revenue. It did so by rationalizing IT and infrastructure costs and reducing complexity, including replacing a highly customized legacy CRM system that stymied customer success and frustrated call center agents.

It undertook a major revitalization of its internal customer-facing systems by employing a utility industry-specific cloud solution for its 1,450 agents, offering a 360-degree customer view that in initial deployments is reducing average call handling times by 10 percent and agent training times by 20 percent. That was just the start of a digital transformation journey that continues today.

CX and IT - better together

For many utilities, customer objectives and IT capabilities move at different speeds and can sometimes be at odds. In every one of the examples we’ve cited, utilities harmonized both customer and IT operations with a flexible cloud solution that took the headache out of technology implementation. Downloadable utility business processes, pre-configured integrations to major CIS and billing systems, and an agile methodology for deployment meant that most of the work was to configure; not code. Customer teams were empowered to configure their workflows and create seamless customer journeys that didn’t break IT operations, using an agile, design-driven methodology that eliminated a lot of back-and-forth with IT for requirements gathering and interoperability testing. This not only made heroes out of IT for delivering functionality and value to customer operations, but it also freed up IT staff to focus more on innovation and less on the time-consuming, basic processes of integration and development.

Conclusion

The four previous examples demonstrate how investments in digital, cloud-based solutions are transforming key facets of the utility business to optimize internal processes, reduce complexity and elevate the customer experience. The key is to begin – and end – with the customer. If your cornerstone is to win and delight customers, your utility can build a foundation that will support a host of other operational benefits. Without radical legacy replacements or byzantine custom-coding efforts, utilities are not only dramatically improving customer relationship management, but also reinventing the entire customer engagement experience to create lifetime customer relationships and value. Utilities no longer have to make wholesale, sudden changes to their IT infrastructure – they now have utility-specific platform options that deliver immediate customer value and all the benefits of the cloud, but that allow them to modernize their legacy stack at a pace and scale of their choosing.