Tag: CRM and CIS

Surviving the Turmoil

With the new administration talking about a trillion dollars of infrastructure investment, the time for the intelligent utility of the future is now. Political pressure and climate change are going to drive massive investments in renewable and clean energy and smart grid technology. These investments will empower customers through the launch and adoption of demand response and energy efficiency programs.

Many believe that the utility industry will change more in the next five years than the previous 50. The greatest technological advancements are only valuable if they can enable desired business outcomes. In a world of rapidly changing technology it is easy to get caught up in the decisions of what to put in, how, when, and where – making it easy to forget why.

A New Era Emerges

The utility industry has, for decades, been the sleeping giant of the U.S. economy. Little has changed in service delivery and consumer options over the last 50 years. But a perfect storm of legislation, funding and technology has set in motion new initiatives that will change the way customers use and think about their utility service. The American Recovery and Reinvestment Act allocates more than $4 billion, via the Smart Grid Investment Grant Program, for development and upgrade of the electrical grid. Simultaneously, significant strides in smart metering technology make the prospect of a rewired grid more feasible.

While technological advances toward the intelligent utility are exciting, technology in and of itself is not the solution for the utility of the future. How those technologies are applied to supporting business outcomes will be key to success in a consumer-empowered environment. Those outcomes must include considerations such as increasing or sustaining customer service levels and reducing bad debt through innovative charging methods and better control of consumption patterns.

Facing New Challenges

Future smart grid considerations aside, consumer expectations are already undergoing transformation. Although some energy prices have decreased recently in light of declining natural gas prices, the long-term trend indicates rates will continue to climb. Faced with increasing energy costs and declining household incomes, customers are looking for options to reduce their utility bill. Further, utilities’ ability to meet demand during peak periods is often inadequate. According to the Galvin Electricity Initiative, “Each day, roughly 500,000 Americans spend at least two hours without electricity in their homes and businesses. Such outages cost at least $150 billion a year. The future looks even worse. Without substantial innovation and investment, rolling blackouts and soaring power bills will become a persistent fact of life [1].”

Simultaneously, environmental concerns are influencing a greater number of consumers than in the past. In April 2009, the U.S. Environmental Protection Agency (EPA) announced it had identified six greenhouse gases that may endanger public health or welfare [2]. According to the EPA, the process of generating electricity creates 41 percent of all carbon dioxide emissions in the U.S. Utilities are under pressure to offer ways to reduce the impact of fossil fuels to accommodate rapidly changing economic and social conditions.

Strategies such as rate structures that incent customers to schedule their energy-intensive activities during off-peak times would help the utility to avoid, or reduce, reliance on the facilities that produce greenhouse gases. Lowering a residential thermostat by just 2 degrees reduces reliance on less desirable sources of generation. According to McKinsey &
Company, carbon dioxide emissions can be reduced by 34 percent in the residential sector alone through enhanced energy productivity [3].

If a significant number of residential consumers could reschedule their peak usage today, it would extend the life of the current infrastructure and reduce the need to raise rates in order to fund capital investments. But at present, in most jurisdictions there is no demonstrable incentive, such as rate structures that reward off-peak usage, to motivate consumers to conserve in any meaningful way.

Aging CIS

Those utilities saddled with aging customer information systems (CIS) – and those executives who have been reluctant to adopt new technology – will be challenged to adapt to the new paradigm. Even utilities with a relatively new CIS in place may find themselves with technology not suited to today’s world. Typically, utilities have been “load serving entities” – matching supply to demand. In the new recession-prone environment, proactive utilities will need to encourage conservation to match supply. Most utilities do not have the capability to show consumers how and when they can save money by using electricity during off-peak hours.

Until utilities can address these needs, and answer customer inquiries about how to save money and energy, they will not be in a position to focus on desired business outcomes. Currently, many utilities track quantitative performance indicators, not business outcomes.

Desired Business Outcomes

Determining the tools, processes or intellectual property needed to achieve desired business outcomes can be a dilemma. Realizing targeted results may require out-of-the-box thinking. To leverage best-in-class practices, many utilities seek external expertise ranging from advisory and consulting resources to a fully outsourced solution.

When addressing the changes the future utility faces, it is easy to become focused on the what, how, when and where to deploy emerging technology rather than the most important element – why deploy at all? Figure 1 depicts Vertex’s four-level solutions approach to business outcomes as an example of keeping the focus on the “why.”

Level 1: Identify Business Challenges. What are the key issues your organization is grappling with? They may be part of the macro trends impacting the industry as a whole or they may be specific to your company. The list might include issues such as substantial bad debt, poor customer satisfaction, declining revenue and profits, high operating cost to serve, and customer acquisition and retention.

Level 2: Identify Desired Outcomes. While acting on business challenges is an integral part of the process, the desired business outcomes are the drivers that will guide you to the solution. At the same time, the solution will also determine if the desired outcomes can be achieved with in-house resources or if an experienced third party should join the team. The solution will also clarify whether you have the technology to realize the desired outcomes or if an investment will be necessary. For example, desired outcomes might include reducing bad debt by 10 percent, improving customer satisfaction from the second quartile to the first quartile, or eliminating 30 percent of the cost of the meter-to-cash process. One or more of these outcomes may require new supporting technology.

Level 3: Develop and Implement Solution. Once the specific business challenges have been fully discussed and the desired outcomes outlined, the next step requires designing the solution to enable achievement. The solution needs to be realistic, in line with your corporate culture, and deliver the right mix of technology, innovation and practicality, all with the appropriate cost-to-value ratio. Management must avoid the lure of overengineering to meet the goal, and thereby incurring more expense and complexity than needed. And the journey from perceived solution to actual solution to achieve a desired outcome might include some surprising elements.

For example, accomplishing the goal of reducing customer service costs by 30 percent might call for enhanced customer service representative (CSR) education and a reduction in the average number of calls a customer makes to the call center each year. The eventual solution may be very complex, and require touching all areas of the meter-to-cash process, along with implementing next generation technology. Or the solution may be as simple as upgrading the customer’s bill to provide more accurate and timely information. Putting more information in the customer’s hands makes billing easier to understand, resulting in fewer customer calls per year, leading to lower customer service costs. The value proposition enabling the business outcome might rely on a more robust analytics engine for analyzing and presenting data to customers. There are generally multiple paths that can bring about achieving a desired business outcome. Seeking external help on the pros and cons of the paths might be valuable to utility executives,
especially if the path involves deploying new technology.

Level 4: Measure Solution Results. Continuous process improvement must be a component of all solutions. The results must be measured and compared against the desired business outcomes. Reviewing results and lessons learned in a closed loop will empower continuous process improvement and maintain focus on the process.

Conservation and Education

While current technology may not be up to the task of helping consumers conserve and save money on energy, those restrictions will change in the very near future. Utilities need to start viewing themselves less as responders to supply and demand and more as advocates for conservation, the environment, and de-coupling of rates. Massive investments in clean and renewable energy, and smart grid technology, will empower customers to employ demand response decisions and gain energy efficiency. The real issue for the utility will not be how to implement the technology itself – wired, wireless, satellite, etc. – but how best to use the technology to achieve its desired business outcomes. Further, utilities need to be prepared for some disruption to business as usual while technology and business processes undergo a sea change.

The capability of deploying a smart grid and advanced meter management (AMM) is one of the most significant changes impacting utilities today. The outcomes are not achieved by technology alone. Those outcomes require the merging of AMM with meter-to-cash processes. The utility will realize business value only if the people and discrete processes within the customer care component of the end-toend process evolve to take advantage of new technology.

The New Reality

Most utilities already enjoy acceptable levels of customer satisfaction. As the smart grid comes on line, with its associated learning curve, myriad details and inevitable glitches, customers will depend on the utility for support and clarification. Call center volumes and average handle times will increase as the complexity of the product grows by an order of magnitude. The old standard of measuring productivity according to number of calls completed within a pre-determined number of minutes will no longer be viable. Average call length increased by a factor of four for one utility that has experimented with smart grid technology. Longer call times, however, can ultimately translate to increased customer satisfaction as consumers receive the information they need to understand the new system and how to reduce their energy bill.

But a four-fold increase in call center staff to accommodate longer calls is not economically practical. In the future, utilities will need to provide more in-depth education to CSRs so they can, in turn, educate customers. They may even need to change their hiring criteria, and seek more highly skilled call center staff who are already versed in the meter-to-cash process. For some customers, alternative sources of information such as the Internet will suffice, thus offsetting some of the strain placed on the call center.

Achieving Desired Outcomes

The following section provides examples of how the combination of advanced meter management and redefined meter-to-cash processes and tools can enable and help achieve desired business outcomes.

Accurate and Timely Data – With smart meters and the smart grid able to capture usage data in intervals as frequent as five minutes, utilities will have more current information about system activity than ever before. Developing a strategy for managing this massive database will require forethought to avoid overwhelming the back office. When fully deployed throughout a service area, customers will no longer receive estimated bills. Devices in the home will provide readouts about usage activity, and some consumer education may be needed to help households understand the presented data and how it translates to their usage patterns and billing. Demand response participation is likely to increase as consumers become more aware of the benefits of managing their energy usage patterns. The federal government’s stimulus bill funding may include allocations for retrofits for low-income homeowners. The call center can function as a resource for customers who wish to investigate this program.

Reduced Bad Debt – As noted earlier, average handle time will be a less significant metric as consumer interaction with the call center increases. The CSR will become a key element in the strategy to reduce bad debt. CSRs will be the conduit for consumer education and building rapport with the customer when resolving past-due bills. As an alternative, utilities may want to turn to Madison Avenue to help them design and roll out a customer information campaign.

Better Revenue Management – If customer education about the smart grid pays off, and consumers are using energy more judiciously, utilities will benefit. Without the pressure to make capital investments for new plants, there will be more opportunities for profit-taking and shareholder rewards. Utilities may instead be able to make profits on their energy efficiency and investments. New technologies will help utilities avoid spending the hundreds of billions of dollars that would otherwise be needed for base load. In addition, demand response participation on the part of residential consumers will better align commercial and industrial (C&I) energy pricing with residential pricing. C&I customers will see the quality and consistency of their power supply improve.

Increased Energy Efficiency – Utilities, whether municipal, public or private, will feel the social pressure to apply technologies in order to gain energy efficiency and encourage conservation. The future utility will become a leader, instead of a follower, in the campaign to improve the environment and use energy resources wisely. By using energy more strategically – that is, understanding the benefits of off-peak usage – consumers will help their utility reduce carbon emissions, which is the ultimate desired business outcome for all involved.

Increased Stakeholder Satisfaction – Stakeholders run the gamut from shareholders and public utility commissions to consumers, utility employees and executives. All of these groups will be pleased if the public uses energy more efficiently, leading to more revenue for the utility and lower costs to consumers. Showing focus on business outcomes is generally a huge plus that helps increase stakeholder satisfaction.

Lower Cost to Serve – Utilities must try to design a business model with flatter delivery costs. For example, if it costs the utility $30 to $40 per customer per year, staying within that existing range with more and longer customer calls will be a challenge. Some utilities may opt out of providing customer service with in-house staff and contract with a service provider. Recognizing that supplying and managing energy, not delivering customer care, is their core competency, a utility can often reduce the cost of customer care by partnering with an organization that is an expert in this business process. If this is the path a utility takes it is very important to find the provider that will enable the desired outcomes of your business; not all service providers are equal or focus on outcomes. We expect relationships with vendors within the industry will change, with utilities embracing more business partners than in the past.

Increased Service Levels – Public utility commissions (PUC) often review financial and service metrics when considering a rate case. Utilities may need to collaborate with PUCs to help them understand the dynamics of smart meters, along with temporary changes in customer satisfaction and service levels, when submitting innovative rate cases and programs. Once the initial disruptive period of new technology is completed, utilities will be able to increase service levels with greater responsiveness to customer needs. When the call center staff is fully educated about smart meters and demand response, they will be positioned to provide customers with more comprehensive service, thus reducing the number of incoming and outgoing calls.

Future Competition – The current and upcoming changes in the industry are so dramatic that utilities must first assess how consumers are accepting change. Reinventing the grid via the smart grid and its related products and services will create new opportunities and new business models with potential for increased revenue. The extent to which the future market is more competitive depends on the rate of acceptance by consumers and how skillfully utilities adopt new business models. It is our premise that utilities who desire the right business outcomes and focus on enabling them through process, people, and technological changes will be most able to excel in a more competitive environment.

References

  1. Galvin Electricity Initiative, sponsored by The Galvin Project, Inc., www.galvinpower.org
  2. Press Release, “EPA Finds Greenhouse Gases Pose Threat to Public Health, Welfare/Proposed Finding Comes in Response to 2007 Supreme Court Ruling,” April 17, 2009. http://yosemite.epa.gov
  3. McKinsey Global Institute, “Wasted Energy: How the US Can Reach its Energy Productivity Potential,” McKinsey
    & Company, June 2007.

Enabling Successful Business Outcomes Through Value-Based Client Relationships

Utilities are facing a host of challenges ranging from environmental concerns, aging infrastructure and systems, to Smart Grid technology and related program decisions. The future utility will be required to find effective solutions to these challenges, while continuing to meet the increasing expectations of newly empowered consumers. Cost management in addressing these challenges is important, but delivery of value is what truly balances efficiency with customer satisfaction.

Our Commitment

Vertex clients trust us to deliver on our promises and commitments, and they partner with us to generate new ideas that will secure their competitive advantage, while also delivering stakeholder benefits. Our innovative same-side-of-the-table approach allows us to transform the efficiency and effectiveness of your business operations, enabling you to lower your risk profile and enhance your reputation in the eyes of customers, investors and regulatory bodies. Working as partners, we provide unique insights that will generate actionable ideas and help you achieve new levels of operational excellence.

With a long heritage in the utility industry, Vertex possesses an in-depth knowledge and understanding of the issues and challenges facing utility businesses today. We actively develop insights and innovative ideas that allow us to work with our utility clients to transform their businesses, and we can enhance your future performance in terms of greater efficiencies, higher customer satisfaction, increased revenue and improved profitability.

Achievement of desired business outcomes is best achieved with a strategic, structured approach that leverages continuous improvement throughout. Vertex takes a four-level approach, which starts with asking the right questions. Levels 1 and 2 identify business challenges and the corresponding outcomes your utility hopes to achieve. Need to improve customer satisfaction? If so, is moving from the 2nd to 1st quartile the right target? Pinpointing the key business challenges that are limiting or impeding your success is critical. These may include a need to reduce bad debt, reduce costs, minimize billing errors, or improve CSR productivity. Whatever challenges you face, collaboration with our experts will ensure your utility is on the right track to meet or exceed your targets.

Once the challenges and outcomes have been identified and validated, Vertex partners with clients to develop effective solutions. The solutions implemented in Level 3 consist of unique value propositions that, when combined effectively, achieve the desired business outcome for the business challenge being addressed. Vertex’s proprietary “Value Creation Model” enables us to develop and implement solutions that provide measurable business results and ongoing quality assurance.

Inherent to the success of this model is the Vertex Transition Methodology, which has resulted in 200 successful transitions over a twelve-year period. Due diligence yields a clear understanding of how the business operates. Mobilizing activities lay the foundation for the transition, and a baseline for the transition plan is established. The plans developed during the planning stage are implemented, followed by a stabilization period from the business transfer to when things are fully operational.

Another key element of this model lies in Vertex’s transformation capabilities, and what we refer to as our “6D” transformation methodology. Dream, Define, Design, Develop, Deliver, Drive – our Lean Six Sigma methods guarantee successful deployment of continuous process improvement results. In addition to Lean Six Sigma, the Vertex Transformation Methodology includes change management, people and performance management, and project management.

In Level 4 of the Vertex solution approach, Vertex measures the effectiveness of a solution by determining if it achieved the desired business outcome. We utilize a Balanced Scorecard approach to ensure that the business outcome positively impacts all of the key elements of a client’s business: Customer, Employee, Operational, and Financial. As desired business outcomes evolve, Vertex will remain committed to adapting our solutions in partnership with our clients to meet these changing needs.

Transforming Your Organization

If you’re ready to transform to an outcomes- based business, Vertex has the capability to help. Our service lines include: Consulting and Transformation, IT Applications Services and Products, Debt Management, and Meter-to-Cash Outsourcing.

Our transformation approach blends innovation and business process improvement, focusing on achieving your strategic objectives via our proven expertise and insights. We bring business transformation that secures greater efficiencies, improved effectiveness and enhanced services for your organization. All the while we never forget that our employees represent your brand.

We’ll work collaboratively with you, rapidly implementing services and delivering on continuous improvement to meet your goals. We’ll build on your business needs, sharing ideas and jointly developing options for change – working together to deliver real value.

Empower Your Customers To Reduce Energy Demand

The Energy Information Administration (EIA) forecasts a continuing gap between total domestic energy production and consumption through 2030. This delta will not be closed by supply alone; customer behavior changes are needed to reduce total consumption and peak load. Electric and gas utilities face tremendous challenges meeting energy supply and demand needs and will play a pivotal role in determining practical solutions. With the right approach, utilities will deliver on the promise of energy efficiency and demand response.

Energy market projections are highly speculative as the market is characterized by high price volatility and rapid market transformation. Adding to the uncertainty is the voluntary nature of demand response and energy efficiency programs, and the critical importance of customer behavior change. Utilities are spending billions of dollars, making program penetration essential – and customer education paramount. At an end-point cost of up to $300, a five percent penetration is not the answer. Vertex can help mitigate these risks through highly effective management of customer care, CIS integration, pilot programs, and analytics. Vertex’s core “meter-to-cash” capabilities have undergone a major revolution in response to the new world of AMI, energy efficiency, and demand response. A robust set of new services will allow utilities to transform how they do business.

Smart meters put new demands on CIS platforms and traditional business processes – innovative rates, distributed generation, demand response and new customer programs all require creative change. Vertex is currently helping utilities develop and manage customer programs to fully exploit smart meter deployments and provide customer care to customers migrating to time-based rates. We deliver customer management services to drive penetration and designed to meet the unique customer care needs generated by smart meter installations, energy efficiency and demand response programs to empower customers to manage their energy use and reduce consumption, and cost-effective customer care and billing solutions to support smart meters.

Water utilities are not immune to the need for conservation. In the past 30 years, the U.S. population has grown over 50% while the total water use has tripled. On average, Americans use approximately 75 to 80 gallons of water per person per day. Vertex can help water utilities address the unique conservation challenges they face, including customer care and program support, MDMS solutions to organize data for forecasting, code enforcement, business and customer insight, and other services.

Case Study – Hydro One

Hydro One is an Ontario, Canada based utility that is one of the five largest transmission utilities in North America. As the stewards of critical provincial assets, Hydro One works with its industry partners to ensure that electricity can be delivered safely, reliably, and affordably to its customers. Vertex has been providing Meter-to-Cash outsourcing services to Hydro One since 2002.

Applying the Vertex 4-level solutions approach enabled desired business outcomes:

Level 1: Identify Business Challenges

In 2006 Hydro One approached Vertex and indicated that one of their corporate goals was to dramatically improve customer satisfaction as a result of the Hydro One customer satisfaction survey. At that point, Hydro One customer satisfaction scores on agent-handled calls had hovered in the 75-76% range for several years. Up to that time, the relationship with Vertex had focused on significant reductions to cost with no erosion to service offered to customers. Now, Hydro One was looking to Vertex to help lead the drive to improve the customer experience.

Level 2: Identify Desired Outcomes

In 2007 Vertex and Hydro One entered into collaborative discussions to evaluate and analyze the historical customer satisfaction scores, and to work jointly to develop a plan to radically modify the customer experience and improve customer satisfaction. Those discussions led down several paths, and the parties mutually agreed to target the following areas for change:

  • The Vertex/Hydro One Quality program
  • A cultural adjustment that would reflect the change in focus
  • Technology that could help support Hydro One’s goals
  • End-to-end process review

Level 3: Develop & Implement Solution

Vertex has worked closely with Hydro One to help them deliver on their goal of significant improvements to customer satisfaction. Changes were applied to process, call scripts, quality measures and performance scoring at all levels in the organization, including incentive compensation and recognition programs.

Level 4: Measure Solution Results

  • Customer satisfaction scores on agent-handled calls increased from 76% in 2006 to 86% in 2008
  • Quality monitoring program changes yielded a 10% increase in first-call resolution
  • Introduced bi-weekly Process/Quality forums
  • Monthly reviews with the client to reinforce success and progress toward targets

Customer Relationships and the Economy

A little over a year ago, the challenges facing the global energy and utilities market were driving a significant wedge between utilities and their customers. In Western European markets, price increases across gas, electricity and water, combined with increased corporate earnings, left many utilities in the uncomfortable position of being seen as profiteering from customers unable to change suppliers for significant benefit.

Headline-makers had a field day, with gross simplification of the many utilities’ business models. They made claims about “obscene profits,” while citing the “long-suffering” consumer position [1]. Now, more than a year later, gas and electricity prices are falling, but the severity and pace of the wider economic downturn has given no time for utilities to re-position themselves with customers. Brand and relationship-enhancing programs such as smart metering and energy efficiency are still largely in their infancy.

The evolving relationship with the customer base, where customer expectations are resulting in a more participatory, multi-channel engagement, comes at a time when the evolution of smart networks and metering solutions are on the cusp of driving down cost to serve and improving service levels and options. Significant benefits accrue from consumption measurement and management capabilities. Benefits also result from the opportunity to transform the consumer relationship by pushing into new areas such as home device management, more personalised tariffs and easier debt arrangements. The position for utilities, therefore, should be favourable – finally being seen as working on a more participatory relationship with their customers.

For consumers, the consequences of recession include an increased pressure on household spending. In competitive markets, there could be increased churn as the ever-changing “best-buys” attract customers. For utilities, increased churn rates are obviously bad news – the cost of new customer acquisition often wipes out profit associated with consumption by that customer for months, even years. Moreover, while utilities are working on marketing the best deals to acquire and retain customers – and on piloting smart technologies in the home – consumers’ familiarity with new technologies and their allegiance to some brands presents an opportunity for third parties to gain greater hold on the customer relationship.

Take the case of smart metering, for example, where many utilities are engaging upon pilot and larger rollouts. This is an area of innovation that should deliver benefits to both consumers and utilities. The assured business benefits to the utility companies come not only from applying the technology to lower operational costs, but also from enhancing their brand and customer service reputation. To the customer, smart technologies offer consumption details in an understandable form and give the promise of accurate commodity billing.

The risk is that the potentially lucrative relationship between customer and utility is currently damaged to a point where telecommunications providers, retailers or technology companies could step in with attractive, multi-service offerings. That could relegate the utility to simple supply activities, unable to gain a significant hold in home engagement. Certainly, utilities will still witness savings from automated meter reading and improved billing accuracy, but this commoditisation path for the utility company will limit profitable growth and push them further away from customers. Combine this with increased churn, and suddenly the benefits of smart technology deployment could be wiped out for the utility company.

This is not just an issue associated with smart technologies – the entire customer relationship journey with a utility is under threat from non-utility entrants (See Figure 1). Consider the area of consumer marketing and sign-up. Third parties that simply market other companies’ services have already taken a position in this part of the customer journey by providing Internet sites that allow tariff comparison and online switching of suppliers. The brand awareness of the comparison sites has already begun to gain the trust of the customer and the utility brand becomes more remote – the start of an uneasy decline. Additionally, in receiving fees for bringing customers to utilities, these companies thrive on churn – driving up utility cost and driving an even greater gap into the consumer-utility relationship.

Further credence to the challenges comes in the areas around presentation of information to customers. Any utility information channel will demand attention to “stickiness” when using technology such as the Internet for displaying utility bills and consumption data. This information has to be pushed to consumers in an attractive, understandable, and above all, personal format. Does the traditional utility information quality and flow have enough appeal for the average consumer to repeatedly view over time? It could be argued that third parties have the ability to blend in more diverse information to improve stickiness on, for example, handheld devices that give the consumer other benefits such as telephony, traffic and weather updates.

Customer Experience Risks

Traditionally, utilities are seen as relatively “recession proof,” operating on longer- term cycles than financial and retail markets. It is this long-term view that, coupled with an already disjointed customer relationship, poses a significant risk to utilities in the next two years. Customers will react in the competitive markets to the feeling of being “cornered” in an environment where few utilities truly differentiate themselves on customer service, product, tariff or brand. Research suggests that consumers are driving change in the relationship with their utilities, and it is this change that opens up opportunity for others (“Plugging in the Consumer”, IBM Institute for Business Value, 2007).

Reaction may not come soon; rarely do new entrants come into a recessionary market. But the potential for non-utilities to begin exploiting the gap between customer and utility should be cause for concern.

The parallel of these changes and risks was seen in the telco landline market over the last two decades. Several of the big, former-monopoly landline carriers are now perceived as commodity bandwidth providers, with declining core customer numbers and often-difficult regulatory challenges. Newer, more agile companies have stepped into the role of “owning” the consumer relationship and are tailoring the commodities into appealing packages. The underlying services may still come from the former-monopoly, but the customer relationship is now skewing toward the new entrant.

There are strategies that can be proactively deployed, individually or in combination, that improve the resilience of a utility through a recession, and that indeed redraw the client relationship to the point where profitability can increase without attracting the appearance of excess. These strategies resist the potential demise of the utilities to commodity providers, allowing for a value-add future based on their pervasive presence in the home.

The five steps outlined below revolve around the need to focus on the fundamentals, namely customer relationships and cash:

  1. Know Your Customer. Like most companies, utilities can benefit greatly by knowing more about customers. By engaging upon a strategy of ongoing information collection, customer segmentation and profitability analysis, plans can be put in place to detect and react to customer attrition risks. This includes early identification of changes to a customer’s circumstances, such as the ability to settle debt, allowing the utility to work proactively with the customer to address the issue. An active relationship style will show consumers that utilities care and understand, increasing brand loyalty, and hence, lowering the cost to serve.
  2. Free Up Locked Cash. Although recession-resistant in the short-term, identifying organic sources of improved cash flow can be an important source of funding for utilities that need to invest in improving customer relationships and capabilities. Industry benchmarks indicate that most utilities have opportunities to plug leaks in their working capital processes, with the potential of tapping into a significant and accessible source of free cash flow. For example, consider the traditionally neglected, under-invested area of consumer debt. With the economic downturn, debt levels are likely to rise, and, if unchecked, costs and cash flow will be adversely impacted.

    Focus areas for addressing the issue and freeing up locked cash include:

    • Using process management techniques such as activity-based management or Lean Six Sigma to identify opportunities for performance improvement across the billing, collections and credit-management processes;
    • Focusing on developing the skills and operational structures required to better integrate the meter to cash functions; and
    • Optimizing the use of utility-specific debt tools that work with the core systems.

Additionally, gaining insights through precision analytics to better manage debt functions – similar to best practices in banking and telecommunications – needs to be accelerated.

  1. Focus on the Future. Cost cutting is inevitable by many companies in this economic environment. It is important to understand the medium-to-long-term impact of any cuts on the customer relationship to determine if they could hurt profitability by increasing churn and related cost-to-serve metrics. Thus, utilities must achieve a clear understanding of their baseline performance, and have a predictive decision-making capability that delivers accurate, real-time insights so they can be confident that any actions taken will yield the best results.
  2. Innovate. Utilities traditionally work on longer investment cycles than many other businesses. When compared to consumer-facing industries, that can result in consumer perception that they are lacking innovation. Many consumers readily accept new offerings from retailers, telcos and technology firms, and the promise of a smart home will clearly be of strong commercial interest to these individuals. That’s why utilities must act now to show how they are changing, innovating for the future and putting control into the hands of the consumer. Smart metering programs will help the utilities reposition themselves as innovators. The key will be to use technology in a manner that bonds the customer better with the utility.
  3. Agility is King. Longer investment cycles in the utility sector, combined with the massive scale of operations and investment, often restrict a utilities’ ability to be agile in their business models. The long-term future of many utilities will depend upon being able to react to new consumer, technology and regulatory demands within short timescales. Innovation is only innovative for a short time – businesses need to be ready to embrace and exploit innovation with new business models.

Take Action Now

Many will argue that the current utility programs of change, such as core system replacement, smart metering and improving customer offerings, will be enough to sustain and even enhance the customer relationship. The real benefit, however, will be from building upon the change, moving into new products, delivering personalized services and tariffs, and demonstrating an understanding of individual consumer needs.

Still, utilities may struggle to capture discretionary spending from customers ahead of telcos, retailers, financial firms and others. Simply put, action needs to be taken now to prevent the loss of long-term customer relationships. For utilities, doing more of the same in this dynamic and changing market may simply not be good enough!

References:

  1. Multiple references, especially in the British press, including this one from Energy Saving Trust: http://www.energysavingtrust.org.uk/Resources/Daily-news/Gas-and-Electricity/Probe-demanded-into-energy-rip-off/(energysavingtrust)/20792

Helping North American Utilities Transform the Way They Do Business

Utilities are facing a host of challenges ranging from environmental concerns, aging infrastructure and systems, to Smart Grid technology and related program decisions. The future utility will be required to find effective solutions to these challenges, while continuing to meet the increasing expectations of newly empowered consumers. This brings an opportunity to create stronger, more profitable relationships with customers, and to do so more cost effectively.

Since our formation in 1996 as the subsidiary of UK-based United Utilities Plc., Vertex Business Services has grown to serve over 70 North American utilities and retail energy clients, who in turn serve over 23 million end-use customers. Our broad portfolio of Business Process Outsourcing (BPO) and Information Technology (IT) solutions enables our clients to more effectively manage operational costs, improve efficiencies, develop front-line employees, and achieve superior customer experience.

Improving Utility Collection Performances

Utilities can greatly benefit from the debt management practices and experience of industries such as banking and retail that have developed a more sophisticated skill set. Benefits can come from adoption of proven methodologies for managing accounts receivable and managing outsourced agency collections business processes, as well as from the use of appropriate software for these processes. There is also benefit to using analytical tools to evaluate the process of collections and optimizing processes based on metrics collected.

Improve your collection rates and lower outstanding accounts receivable through Vertex’s proven collection services. Our rich heritage results in our ability to implement best practices and provide quality reporting strategies, ironclad credit and collection processes, and innovative training programs.

Handling Demand Response and Efficiency In the Call Center

In the next five to 10 years, utilities will be forced to change more than at any time in their previous history. These changes will be profound, widespread and will affect not only utilities themselves, but virtually all parts of our modern electrified culture. One of the most dramatic changes will be in the traditional relationship between utilities and their customers, especially at the residential level. Passive electricity "rate payers" are about to become very active participants in the relationship with their utility.

Turning Information Into Power

Around the world, utilities are under pressure. Citizens demand energy and water that don’t undermine environmental quality. Regulators seek action on smart grids and smart metering initiatives that add intelligence to infrastructure. Customers seek choice and convenience – but without additional costs.

Around the globe, utilities are re-examining every aspect of their business.

Oracle can help. We offer utility experts, mission-critical software applications, a rock-solid operational software suite, and world-leading middleware and technology that can help address these challenges. The result: flexible, innovative solutions that increase efficiency, improve stakeholder satisfaction, futureproof your organization – and turn information into power.

Utilities can begin with one best-of breed solution that addresses a specific pain point. Alternatively, you can implement several pre-integrated applications to ease the development and administration of cross-departmental business processes. Our complete applications and technology footprint can be standardized to focus on accountability and reduce the resources spent on vendor relations.

Oracle Is A Leader In Utilities: 20 of the Top 20 Global Utilities Get Results With Oracle

Oracle provides utilities with the world’s most complete set of software choices. We help you address emerging customer needs, speed delivery of utility-specific services, increase administrative efficiency, and turn business data into business intelligence.

Oracle Utilities offers the world’s most complete suite of end-to-end information technology solutions for the gas, water, and electric utilities that underpin communities around the world. Our revolutionary approach to providing utilities with the applications and expertise they need brings together:

  • Oracle Utilities solutions, utility-specific revenue and operations management applications:
    • Customer Care and Billing
    • Mobile Workforce Management
    • Network Management System
    • Work and Asset Management
    • Meter Data Management (Standard and Enterprise Editions)
    • Load Analysis
    • Load Profiling and Settlement
    • Portfolio Management
    • Quotation Management
    • Business Intelligence
  • Oracle’s ERP, database and infrastructure software:
    • Oracle E-Business Suite and other ERP applications
    • Times Ten for real-time data management
    • Data hubs for customer and product master data management
    • Analytics that provide insight and customer intelligence
    • ContentDB, SpatialDB and RecordsDB for content management
    • Secure Enterprise Search for enterprise-wide search needs
  • Siebel CRM for larger competitive utilities’ call centers, customer order management, specialized contacts and strategic sales:
    • Comprehensive transactional, analytical and engagement CRM capabilities
    • Tailored industry solutions
    • Role-based customer intelligence and pre-built
  • Oracle’s AutoVue Enterprise Visualization Solutions:
    • Make business and technical documents easily accessible by all enterprise users
    • Expedite document reviews with built-in digital annotations and markups
    • Boost the value of your enterprise system with integrated Enterprise Visualization
  • Oracle’s Primavera Solutions:
    • Effectively manage and control the most complex projects and project portfolio
    • Deliver projects across generation, transmission and distribution, and new clean-energy ventures
    • Optimize a diminishing but highly skilled workforce

Stand-alone, each of these products meets utilities’ unique customer and service needs. Together, they enable multi-departmental business processes. The result is an unparalleled set of technologies that address utilities’ most pressing current and emerging issues.

The Vision

Cross-organizational business processes and best practices are key to addressing today’s complex challenges. Oracle Utilities provides the path via which utilities may:

  • Address the "green agenda:"
    • Help reduce pollution
    • Increase efficiency
    • Complete software suite to enable the smart grid
  • Advance customer care with:
    • Real-time 360-degree views of customer information
    • Tools to help customers save time and money
    • Introduce or retire products and services quickly, in response to emerging customer needs
  • Enhance revenue and operations management:
    • Avoid revenue leakage across end-to-end transactions
    • Increase the visibility and auditability of key business processes
    • Manage assets strategically
    • Bill for services and collect revenue cost-effectively
    • Increase field crew and network efficiency
    • Track and improve performance against goals
    • Achieve competitive advantage with a leading-edge infrastructure that helps utilities respond quickly to change
  • Reduce total cost of ownership through access to a single global vendor with:
    • Proven best-in-class utility management solutions
    • Comprehensive, world-class capabilities in applications and technology infrastructure
    • A global 24/7 distribution and support network with 7,000 service personnel
    • Over 14,000 software developers
    • Over 19,000 partners

Strategic Technology For Every Utility

Only Oracle powers the information-driven enterprise by offering a complete, integrated solution for every segment of the utilities industry – from generation and transmission to distribution and retail services. And when you run Oracle applications on Oracle technology, you speed implementation, optimize performance, and maximize ROI.

When it comes to handling innovations like daily or interval meter reading, installing, maintaining, and replacing plant and linear assets, providing accurate bills and supporting your contact center and more, Oracle Utilities is the solution of choice. Utilities succeed with Oracle. Oracle helps electric, gas, water and waste management meet today’s imperatives to do the following:

  • Help customers conserve energy and reduce carbon footprints
  • Keep energy affordable
  • Strengthen and secure communities’ economic foundation

Meeting the Challenges of the Future, Today

Utilities today need a suite of software applications and technology to serve as a robust springboard from which to meet the challenges of the future.

Oracle offers that suite.

Oracle Utilities solutions enable you to meet tomorrow’s customer needs while addressing the varying concerns of financial stakeholders, employees, communities, and governments. We work with you to address emerging issues and changing business conditions. We help you to evolve to take advantage of new technology directions and to incorporate innovation into ongoing activity.

Partnering with Oracle helps you to futureproof your utility.

Improving Call Center Performance Through Process Enhancements

The great American philosopher Yogi Berra once said, “If you don’t know where you’re going, chances are you will end up somewhere else.” Yet many utilities possess only a limited understanding of their call center operations, which can prevent them from reaching the ultimate goal: improving performance and customer satisfaction, and reducing costs.

Utilities face three key barriers in seeking to improve their call center operations:

  • Call centers routinely collect data on “average” performance, such as average handle time, average speed of answer and average hold time, without delving into the details behind the averages. The risk is that instances of poor and exemplary performance alike are not revealed by such averages.
  • Call centers typically perform quality reviews on less than one-half percent of calls received. Poor performance by individual employees – and perhaps the overall call center – can thus be masked by insufficient data.
  • Calls centers often fail to periodically review their processes. When they do, they frequently lack statistically valid data to perform the reviews. Without detailed knowledge of call center processes, utilities are unlikely to recognize and correct problems.

There are, however, proven methods for overcoming these problems. We advocate a three-step process designed to achieve more effective and efficient call center operations: collect sufficient data; analyze the data; and review and monitor progress on an ongoing basis.

STEP 1: COLLECT SUFFICIENT DATA

The ideal sampling size is 1,000 randomly selected calls. This size call sample typically provides results that are accurate +/- 3 percent, with a more than 90 percent degree of confidence. These are typical levels of accuracy and confidence that businesses require before they are likely to undertake action.

The types of data that should be collected from each call include:

  • Call type, such as new service, emergency, bill payment or high bill, and subcall type.
  • Number of systems and/or screens used – for example, how many screens did it take to complete a new service request?
  • Actions taken during the call, such as greeting the customer, gathering customer- identity data, understanding the problem or delivering the solution.
  • Actions taken after the call – for example, entering data into computer systems, or sending notes or Emails to the customer or contact center colleagues.

Having the right tool can greatly facilitate data collection. For example, the call center data collection tool pictured in Figure 1 captures this information quickly and easily, using three push-button timers that enable accurate data collection.

When a call is being reviewed, the analyst pushes the green buttons to indicate which of 12 different steps within a call sequence is occurring. The steps include greeting, hold and transfer, among others. Similarly, the yellow buttons enable the analyst to collect the time elapsed for each of 15 different screens that may be used and up to 15 actions taken after the call is finished.

This analysis resembles a traditional “time and motion” study, because in many ways it is just that. But the difference here is that we can use new automated tools, such as the voice and screen capture tools and data collector shown, as well as new approaches, to gain new insights.

The data capture tool also enables the analyst to collect up to 100 additional pieces of data, including the “secondary and tertiary call type.” (As an example, a credit call may be the primary call type, a budget billing the secondary call type and a customer in arrears the tertiary call type.) The tool also lets the analyst use drop-down boxes to quickly collect data on transfers, hold time, mistakes made and opportunities noted.

Moreover, this process can be executed quickly. In our experience, it takes four trained employees five days to gather data on 1,000 calls.

STEP 2: ANALYZE THE DATA

Having collected this large amount of data, how do you use the information to reduce costs and improve customer and employee satisfaction? Again, having the right tool enables analysts to easily generate statistics and graphs from the collected data. Figure 2 shows the type of report that can be generated based on the recommended data collection.

The analytic value of Figure 2 is that it addresses the fact that most call center reports focus on “averages” and thus fail to reveal other important details. Figure 2 shows the 1,000 calls by call-handle time. Note that the “average” call took 4.65 minutes; however, many calls took a minute or less, and a disturbingly large number of calls took well over 11 minutes.

Using the captured data, utilities can then analyze what causes problem calls. In this example, we analyzed 5 percent of the calls (49 in total) and identified several problems:

  • Customer service representatives (CSRs) were taking calls for which they were inadequately trained, causing high hold times and inordinately large screen usage numbers.
  • IT systems were slow on one particular call type.
  • There were no procedures in place to intercede when an employee took more than a specified number of minutes to complete a call.
  • Procedures were laborious, due to Public Utilities Commission (PUC) regulations or – more likely – internally mandated rules.

This kind of analysis, which we describe as a “longest call” review, typically helps identify problems that can be resolved at minimal cost. In fact, our experience in utility and other call centers confirms that this kind of analysis often allows companies to cut call-handle time by 10 to 15 seconds.

It’s important to understand what 10 to 15 fewer seconds of call-handle time means to the call center – and, most importantly, to customers. For a typical utility call center with 200 or more CSRs, the shorter handle time can result in a 5 percent cost reduction, or roughly $1 million annually. Companies that can comprehend the economic value and customer satisfaction associated with reducing average handle time, even by one second, are likely to be better focused on solving problems and prioritizing solutions.

Surprisingly, the longest 5 percent of calls typically represent nearly 15 percent of the total call center handle time, representing a mother lode of opportunity for improvement.

Another important benefit that can result from this detailed examination of call center sampling data involves looking at hold time. A sample hold time analysis graph is pictured in Figure 3.

Excessive hold times tend to be caused by bad call routing, lengthy notes on file, unclear processes and customer issues. Each of these problems has a solution, usually low-cost and easily implemented. Most importantly, the value of each action is quantified and understood, based on the data collected.

Other useful questions to ask include:

  • What are the details behind the high average after-call work (ACW) time? How does this affect your call center costs?
  • How would it help budget discussions with IT if you knew the impact of such things as inefficient call routing, poor integrated voice response (IVR) scripts or low screen pop percentages?
  • What analyses can you perform to understand how you should improve training courses and focus your quality review efforts?

The output of these analyses can prove invaluable in budget discussions and in prioritizing improvement efforts, and is also useful in communicating proposals to senior management, CSRs, quality review staff, customers and external organizations. The data can also be the starting point for a Six Sigma review.

Utilities can frequently achieve a 20 percent cost reduction by collecting the right data and analyzing it at a sufficiently granular level. Following is a breakdown of the potential savings:

  • Three percent savings can be achieved by reducing longest calls by 10 seconds.
  • Five percent savings can be gained by reducing ACW by 15 seconds.
  • Five percent savings can be realized by improving call routing – usually by aligning CSR skills required with CSR skills available – by 15 seconds.
  • Three percent savings can be achieved by improving process for two frequent processes by 10 seconds each.
  • Three percent savings can be realized by improving IVR and screen pop frequency and quality of information by 10 seconds.
  • One percent savings can be gained by improving IT response time on selected screens by three seconds.

STEP 3: REVIEW AND MONITOR PROGRESS ON AN ONGOING BASIS

Although this white paper focuses on the data collection and analyses procedures used, the key difference in this approach is the optimization strategy behind it.

The two-step approach outlined above starts with utilities recognizing that improvement opportunities exist, understanding the value of detailed data in identifying these opportunities and enabling the data collected to be easily presented and reviewed. Taken as a whole, this process can produce prioritized, high-ROI recommendations.

To gain the full value of this approach, utilities should do the following:

  • Engage the quality review team, trainers, supervisors and CSRs in the review process;
  • Expand the focus of the quality review team from looking only at individual CSRs’ performance to looking at organizational processes as well;
  • Have trainers embed the new lessons learned in training classes;
  • Encourage supervisors to reinforce lessons learned in team meetings and one-on-one coaching; and
  • Require CSRs to identify issues that can be studied in future reviews and follow the lessons learned.

Leading organizations perform these reviews periodically, building on their understanding of their call centers’ current status and using that understanding to formulate actions for future improvement.

Once the first study is complete, utilities also have a benchmark to which results from future studies can be compared. The value of having these prior analyses should be obvious in each succeeding review, as hold times decline, average handle times decrease, calls are routed more frequently to the properly skilled person and IT investments made based on ROI analyses begin to yield benefits.

Beyond these savings, customer and employee satisfaction should increase. When a call is routed to the CSR with the requisite skills needed to handle it, both the customer and the CSR are happier. Customer and CSR frustration will also be reduced when there are clear procedures to escalate calls, and IT systems fail less frequently.

IMPLEMENTING A CALL CENTER REVIEW

Although there are some commonalities in improving utilities’ call center performance, there are always unique findings specific to a given call center that help define the nature and volume of opportunities, as well as help chart the path to improvement.

By realizing that benefit opportunities exist and applying the process steps described above, and by using appropriate tools to reduce costs and improve customer and CSR satisfaction, utilities have the opportunity to transform the effectiveness of their call centers.

Perhaps we should end with another quote from Yogi: “The future ain’t what it used to be.” In fact, for utilities that implement these steps, the future will likely be much better.

Microsoft Helps Utilities Use IT to Create Winning Relationships

The utilities industry worldwide is experiencing growing energy demand in a world with shifting fuel availability, increasing costs, a shrinking workforce and mounting global environmental pressures. Rate case filings and government regulations, especially those regarding environmental health and safety, require utilities to streamline reporting and operate safely enterprise-wide. At the same time, increasing competition and costs drive the need for service reliability and better customer service. Each issue causes utilities to depend more and more on information technology (IT).

The Microsoft Utility team works with industry partners to create and deploy industry-specific solutions that help utilities transform challenges into opportunities and empower utilities workers to thrive in today’s market-driven environment. Solutions are based on the world’s most cost-effective, functionally rich, and secure IT platform. The Microsoft platform is interoperable with a wide variety of systems and proven to improve people’s abilities to access information and work with others across boundaries. Together, they help utilities optimize operations in each line of business.

Customer care. Whether a utility needs to modernize a call center, add customer self-service or respond to new business requirements such as green power, Microsoft and its partners provide solutions for turning the customer experience into a powerful competitive advantage with increased cost efficiencies, enhanced customer service and improved financial performance.

Transmission and distribution. Growing energy demand makes it critical to effectively address safe, reliable and efficient power delivery worldwide. To help utilities meet these needs, Microsoft and its partners offer EMS, DMS and SCADA systems; mobile workforce management solutions; project intelligence; geographic information systems; smart metering/grid; and work/asset/document management tools that streamline business processes and offer connectivity across the enterprise and beyond.

Generation. Microsoft and its partners provide utilities with a view across and into their generation operations that enables them to make better decisions to improve cycle times, output and overall effectiveness while reducing the carbon footprint. With advanced software solutions from Microsoft and its partners, utilities can monitor equipment to catch early failure warnings, measure fleets’ economic performance and reduce operational and environment risk.

Energy trading and risk management. Market conditions require utilities to optimize energy supply performance. Microsoft and its partners’ enterprise risk management and trading solutions help utilities feed the relentless energy demands in a resource-constrained world.

Regulatory compliance. Microsoft and its partners offer solutions to address the compliance requirements of the European Union; Federal Energy Regulatory Commission; North American Reliability Council; Sarbanes-Oxley Act of 2000; Environmental, Health and Safety; and other regional jurisdiction regulations and rate case issues. With solutions from Microsoft partners, utilities have a proactive approach to compliance, the most effective way to manage operational risk across the enterprise.

Enterprise. To optimize their businesses, utility executives need real-time visibility across the enterprise. Microsoft and its partners provide integrated e-business solutions that help utilities optimize their interactions with customers, vendors and partners. These enterprise applications address business intelligence and reporting, customer relationship management, collaborative workspaces, human resources and financial management.

Using Analytics for Better Mobile Technology Decisions

Mobile computing capabilities have been proven to drive business value by providing traveling executives, field workers and customer service personnel with real-time access to customer data. Better and more timely access to information shortens response times, improves accuracy and makes the workforce more productive.

However, although your organization may agree that technology can improve business processes, different stakeholders – IT management, financial and business leadership and operations personnel – often have different perspectives on the real costs and value of mobility. For example, operations wants tools that help employees work faster and focus more intently on the customer; finance wants the solution that costs the least amount this quarter; and IT wants to implement mobile projects that can succeed without draining resources from other initiatives.

It may not be obvious, but there are ways to achieve everyone’s goals. Analytics can help operations, finance and IT find common ground. When teams understand the data, they can understand the logic. And when they understand the logic they can support making the right decision.

EXPOSING THE FORMULA

Deploying mobile technology is a strategic initiative with far-reaching consequences for the health of an enterprise. In the midst of evaluating a mobile project, however, it’s easy to forget that the real goal of hardware-acquisition initiatives is to make the workforce more productive and improve both the top and bottom lines over the long term.

Most decision-analytics tools focus on up-front procurement questions alone, because the numbers seem straightforward and uncomplicated. But these analyses miss the point. The best analysis is one that can determine which of the solutions will provide the most advantages to the workforce at the lowest possible overall cost to the organization.

To achieve the best return on investment we must do more than recoup an out-of-pocket expense: Are customers better served? Are employees working better, faster, smarter? Though hard to quantify, these are the fundamental aspects that determine the return on investment (ROI) of technology.

It’s possible to build a vendor-neutral analysis to calculate the total cost of ownership (TCO) and ROI of mobile computers. Panasonic Computer Solutions Company, the manufacturer of Toughbook notebooks, enlisted the services of my analytics company, Serious Networks, Inc., to develop an unbiased TCO/ROI application to help companies make better decisions when purchasing mobile computers.

The Panasonic-sponsored operational analysis tool provides statistically valid answers by performing a simulation of the devices as they would be used and managed in the field, generating a model that compares the costs and benefits of multiple manufacturers’ laptops. Purchase cost, projected downtime, the range of wireless options, notebook features, support and other related costs are all incorporated into this analytic toolset.

Using over 100 unique simulations with actual customers, four key TCO/ROI questions emerged:

  • What will it cost to buy a proposed notebook solution?
  • What will it cost to own it over the life of the project?
  • What will it cost to deploy and decommission the units?
  • What value will be created for the organization?

MOVING BEYOND GUESSTIMATES – CONSIDERING COSTS AND VALUE OVER A LIFETIME

There is no such thing as an average company, so an honest analysis uses actual corporate data instead of industry averages. Just because a device is the right choice for one company does not make it the right choice for yours.

An effective simulation takes into account the cost of each competing device, the number of units and the rate of deployment. It calculates the cost of maintaining a solution and establishes the value of productive time using real loaded labor rates or revenue hours. It considers buy versus lease questions and can extrapolate how features will be used in the field.

As real-world data is entered, the software determines which mobile computing solution is most likely to help the company reach its goals. Managers can perform what-if analyses by adjusting assumptions and re-running the simulation. Within this framework, managers will build a business case that forecasts the costs of each mobile device against the benefits derived over time (see Figures 1 and 2).

MAKING INTANGIBLES TANGIBLE

The 90-minute analysis process is very granular. It’s based on the industry segment – because it simulates the tasks of the workforce – and compares up to 10 competing devices.

Once devices are selected, purchase or lease prices are entered, followed by value-added benefits like no-fault warranties and on-site support. Intangible factors favoring one vendor over another, such as incumbency, are added to the data set. The size and rate of the deployment, as well as details that determine the cost of preparing the units for the workforce, are also considered.

Next the analysis accounts for the likelihood and cost of failure, using your own experience as a baseline. Somewhat surprisingly, the impact of failure is given less weight than most outside observers would expect. Reliability is important, but it’s not the only or most important attribute.

What is given more weight are productivity and operational enhancements, which can have a significantly greater financial impact than reliability, because statistically employees will spend much more of their time working than dealing with equipment malfunctions.

A matrix of features and key workforce behaviors is developed to examine the relative importance of touch screens, wireless and GPS, as well as each computer vendor’s ability to provide those features as standard or extra-cost equipment. The features are rated for their time and motion impact on your organization, and an operations efficiency score is applied to imitate real-world results.

During the session, the workforce is described in detail, because this information directly affects the cost and benefit. To assess the value of a telephone lineman’s time, for example, the system must know the average number of daily service orders, the percentage of those service calls that require re-work and whether linemen are normally in the field five, six or seven days a week.

Once the data is collected and input it can be modified to provide instantaneous what-if, heads-up and break-even analyses reports – without interference from the vendor. The model is built in Microsoft Excel so that anyone can assess the credibility of the analysis and determine independently that there are no hidden calculations or unfair formulas skewing the results.

CONCLUSION

The Panasonic simulation tool can help different organizations within a company come to consensus before making a buying decision. Analytics help clarify whether a purpose-built rugged or business-rugged system or some other commercial notebook solution is really the right choice for minimizing the TCO and maximizing the ROI of workforce mobility.

ABOUT THE AUTHOR

Jason Buk is an operations director at Serious Networks, Inc., a Denver-based business analytics firm. Serious Networks uses honest forecasting and rigorous analysis to determine what resources are most likely to increase the effectiveness of the workforce, meet corporate goals and manage risk in the future.

Cutting-Edge Communication: Streamlining Customer Contact With Automated Messaging

Improving cash flow, reducing costs, freeing up agents, experiencing an immediate return on investment: These are what it’s all about, right? Since 1992, TeleVox has been at the forefront of customer communication, offering best-of-breed communication technology. More than 14,000 clients rely on TeleVox each and every day to efficiently and effectively contact their customers. Why? Because the subscription-based HouseCalls automated messaging system has proven to meet all their objectives for only pennies per call.

There’s no denying the positive impact of clear, dependable communication between a utility and its customers. Over the years, however, this has presented an increasingly difficult challenge. Utilities are being asked to communicate with growing customer bases with fewer resources. To help reverse this trend, automated messaging technologies, such as TeleVox’s HouseCalls, have emerged to play an important role in customer contact. As other messaging providers have battled rigid pricing structures, limited calling capacity and functionality challenges, HouseCalls has consistently performed as a cost-effective solution that meets the needs of each individual client.

COLLECTIONS

Nowhere are the benefits of automated messaging technology more apparent than in collections. HouseCalls delivers payment reminders personalized with names, dates, amounts due and other information. Messages also employ multiple levels of right-party verification to protect the customer. Once the message is delivered, the customer can take advantage of response options to speak with a live agent or transfer to an automated third-party credit card acceptance company. When matched with a third-party collector, HouseCalls automates the entire collections process without manual intervention from the utility.

Utilities can determine their own strategy when integrating automated messaging into the collections process. The messages sent to customers can vary in tone and content based on internal credit ratings and scores. Many TeleVox clients use HouseCalls to contact large volumes of newly delinquent accounts (30 to 60 days), hoping to resolve them before they age further. This frees agents to focus on more difficult accounts.

The immediate ROI of automated messaging in collections has made it a widely embraced practice among the nation’s leading utilities for reducing Accounts Receivable. Some utilities have estimated as much as $200 in return for every dollar spent. The technology’s flexibility facilitates quicker, less expensive collections efforts. It also decreases expensive mailings, costly disconnects and truck rolls that become necessary as delinquencies progress.

MARKETING CAMPAIGNS

From billing to usage issues, the range of programs utilities offer to customers has become increasingly broad. Automated calls have experienced phenomenal response rates from customers eager to take advantage of new offerings.

Common marketing campaigns include:

  • Budget billing
  • Low-income housing assistance
  • Meter replacement
  • Demand conservation

Why do automated calls produce greater results than direct-mail pieces, bill stuffers or Emails? One factor is audience attention. Since HouseCalls outbound messages can be recorded using 100 percent human voices and feature the Caller ID number of the utility, customers are more likely to listen to the telephone message than read an extra piece of mail. During the message, many utilities give customers the opportunity to transfer to live agents to learn more about the particular program, enroll during the call or be directed to a website for more information.

Calls cost pennies to deliver, far less than the soaring printing and postage costs associated with mailed media. Whether employed as a stand-alone marketing strategy or combined with direct mail, automated messaging proves to be a cost-effective promotional tool.

OUTAGE AND RESTORATION NOTIFICATIONS

In the utility industry, the old saying holds true: Expect the unexpected. A little preparation goes a long way toward instilling customer confidence, and this certainly applies to service outages. It’s inevitable that at some point customers are going to experience unavoidable interruptions in their service.

When that happens, leading utilities can proactively communicate with customers and keep them informed of the progress being made to restore service in the area. Automated messaging is ideal for such situations, covering large service territories (able to reach as many as 300,000 customers per hour) while maintaining a high capability of customer interaction. Messages can be created and delivered in as little as five minutes.

During outages, customers will often receive messages from their utilities reassuring them that technicians are working to restore service. Providing important contact numbers and information can also be helpful to customers during this period.

As restoration efforts progress, utilities can deliver messages to each customer to determine if service has been restored. Automated messages allow for immediate customer feedback and significantly reduce inbound traffic to the utility’s call center.

In some situations, utilities contact their customer base before a planned outage. This approach is especially appreciated when working with critical-care customers.

HOUSECALLS BENEFITS

Since HouseCalls is a subscription-based ASP (Application Service Provider) solution hosted by TeleVox, there are no hardware purchases or capital investments for the utility. Rather than requiring large expenditures for on-site equipment, utilities are charged on a per-call basis for completed calls – with no cost for undeliverables.

NEXT STEPS

To begin harnessing the power of HouseCalls for your customer communication, you are encouraged to contact a TeleVox representative at 1-800-644-4266 or info@televox.com. You may also visit TeleVox online at www.televox.com.

Technology with vision for Today’s Utilities

Around the world, utilities are under pressure. Citizens demand that utilities provide energy and water without undermining environmental quality. Customers seek choice and convenience, and regulators respond with new market structures. Financial stakeholders look for operational efficiency at a time when aging workforces and infrastructures need replacement.

Pressures like these are forcing utilities to re-examine every aspect of the utility business, from supply to consumption. And no utility can handle those changes alone.

Oracle has positioned itself to become utilities’ software partner of choice in the quest to respond positively and completely to these pressures. To do so, Oracle brings together a worldwide team of utility experts, software applications that address mission-critical utility needs, a rock-solid suite of corporate operational software and world-leading middleware and technology.

The result: Flexible, innovative solutions that increase efficiency, improve stakeholder satisfaction and future-proof the organization.

Oracle has reshaped the utilities IT marketplace. During the past year, by acquiring two world leaders in utility-specific applications – SPL WorldGroup and Lodestar – Oracle has created Oracle Utilities, a new brand that establishes a unique portfolio of proven software, integrating industry-specific applications with the capabilities of Oracle Applications, Oracle Fusion Middleware and Oracle Database.

Oracle Utilities offers the world’s most complete suite of end-to-end information technology solutions for the gas, water and electric utilities that communities around the world depend on. Our revolutionary approach to providing utilities with the applications and expertise they need brings together:

  • Oracle Utilities solutions, utility-specific revenue and operations management applications:
    • Customer Care and Billing
    • Mobile Workforce Management
    • Network Management System
    • Work and Asset Management
    • Meter Data Management
    • Load Analysis
    • Load Profiling and Settlement
    • Portfolio Management
    • Quotations Management
    • Business Intelligence

These solutions are available stand-alone, or as an integrated suite.

  • Oracle’s ERP, database and infrastructure software:
    • Oracle E-Business Suite and other ERP applications
    • TimesTen and Sleepycat for real-time data management
    • Data hubs for customer and product master data management
    • Analytics that provide insight and customer intelligence
    • ContentDB, SpatialDB and RecordsDB for content management
    • Secure Enterprise Search for enterprise-wide search needs
  • Siebel CRM for larger competitive utilities’ call centers, specialized contacts and sales:
    • Most comprehensive solution for Sales, Service and Marketing
    • Complete out-of-the box solution that’s easy to tailor to your needs
    • Results such as percentage increase in sales pipeline, user adoption, opportunity-to-win ratios and doubled revenue growth

Stand-alone, each of these products meets utilities’ unique customer and service needs. Together, they enable multi-departmental business processes. The result is an unparalleled set of technologies that address utilities’ most pressing current and emerging issues.

THE VISION

Cross-organizational business processes and best practices are key to addressing today’s complex challenges. Oracle Utilities provides the path via which utilities may:

  • Advance customer care with:
    • Real-time 360-degree views of customer information
    • Tools to help customers save time and money
    • Ability to introduce or retire products and services quickly in response to emerging customer needs
  • Enhance revenue and operations management:
    • Avoid revenue leakage across end-to-end transactions
    • Increase the visibility and auditability of key business processes
    • Manage assets strategically
    • Bill for services and collect revenue cost-effectively
    • Increase field crew and network efficiency
    • Track and improve performance against goals
    • Achieve competitive advantage with a leading-edge infrastructure that helps utilities respond quickly to change
  • Reduce total cost of ownership through access to a single global vendor with:
    • Proven best-in-class utility management solutions
    • Comprehensive, world-class capabilities in applications and technology infrastructure
    • A global 24/7 distribution and support network with 7,000 service personnel
    • Over 14,000 software developers
    • Over 19,000 partners
  • Address the “Green Agenda”:
    • Help reduce pollution
    • Increase efficiency

STRATEGIC TECHNOLOGY FOR THE EMERGING UTILITY

Today’s utility is beset by urgent issues – environmental concerns, rising costs, aging workforces, changing markets, regulatory demands and rising stakeholder expectations.

Oracle Utilities can help meet these challenges by providing the leading mission-critical utilities suite in the marketplace today. Oracle integrates industry-specific customer care and billing, network management, work and asset management, mobile workforce management and meter data management applications with the capabilities of Oracle’s industry-leading enterprise applications, business intelligence tools, middleware and database technologies. We enable customers to adapt more nimbly to market deregulation, help them meet ever-evolving customer demands, enhance operational excellence and deliver on commitments to environmental conservation.

Oracle Utilities’ flexible, standards-based applications and architecture help utilities innovate. They lead toward coherent technology solutions. Oracle helps utilities keep pace with change without losing focus on the energy, water and waste services fundamental to local and global human and economic welfare.

Only Oracle powers the information-driven enterprise by offering a complete, integrated solution for every segment of the utilities industry – from generation and transmission to distribution and retail services. And when you run Oracle applications on Oracle technology, you speed implementation, optimize performance and maximize ROI.

Utilities today need a suite of software applications and technology to serve as a robust springboard from which to meet the challenges of the future.

Oracle offers that suite.

Oracle Utilities solutions enable you to meet tomorrow’s customer needs while addressing the varying concerns of financial stakeholders, employees, communities and governments. We work with you to address emerging issues and changing business conditions. We help you to evolve to take advantage of new technology directions and to incorporate innovation into ongoing activity.

Partnering with Oracle helps you to future-proof your utility.

CONTACT US

For more information, call +1.800.275.4775 to speak to an Oracle representative, or visit oracle.com/industries/utilities.

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