WHITE PAPER
Published 2Q 2012
Bridging the Divide
Utilities and the Customer Capabilities Gap
Published 2Q 2016
Sponsored by Opower
Richelle Elberg
Principal Research Analyst
Aida Hakirevic
Associate Director
Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 1
EXECUTIVE SUMMARY
1.1
Introduction
Utilities today are facing regulatory disruption, stagnant load growth, financial pressures,
and competition from distributed generation (i.e., solar) and other third-party service
providers. At the same time, their customers have come to expect a service experience
that is on par with the advanced support now offered by other industries. Websites with
sophisticated self-service capabilities, mobile applications, and online chat support are just
a few of the engagement channels now considered standard. In short, utilities are facing
the most competitive environment that the electric power industry has ever known.
Industry executives understand this changing dynamic quite well, but based on a study
conducted by Navigant Research (Navigant) in February and March of 2016, most feel less
than confident about their utility’s ability to meet all of those demands today. Multiyear
roadmaps have been drawn and cross-channel plans for improved customer experience
are underway at all of the major utilities. Attitudes toward significant customer-facing
technology investments are changing and senior leadership is more likely than ever to
support multi-million dollar projects designed to shore up customer experience or engage
customers in new ways. Nonetheless, there is still work to be done.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
1.2
Study Overview and the Capabilities Gap
For this white paper, Navigant conducted an online survey of nearly 100 utility executives
in IT, customer service, and other leadership roles at North American utilities. When asked
the question, “Related to customer engagement, what business goal is most important to
you,” the majority ranked increasing customer satisfaction as the most important goal, well
above reducing costs or increasing revenue (Chart 1.1).
Chart 1.1
Top Customer Service Business Goals (Based on a Survey of 96 Utility Executives)
Protecting Customer
Information
1%
Reducing IT or OT
Costs
16%
Reducing Cost-toServe
16%
Increasing Digital
Engagement
4%
Increasing Revenue
11%
Increasing
Customer
Satisfaction/NPS
52%
(Source: Navigant Research)
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in whole or in part, without the express written permission of Navigant Consulting, Inc.
2
Bridging the Divide: Utilities and the Customer Capabilities Gap
However, executives’ confidence in their current capabilities to deliver better customer
experience is low. As a part of the study, executives were asked to rank 15 categories of
Customer Engagement (CE) capabilities in order of importance and were then asked about
their confidence levels related to their utility’s ability to perform each. Even for the
capabilities that respondents felt were “Very” or “Of Utmost Importance” to their overall
customer journey, fewer than two in five were “Very Confident” in their utility’s abilities. In
fact, their absolute vote of confidence in current capabilities ranged from only 6% to 24%,
as presented in Chart 1.2.
Chart 1.2
High Confidence in CE Capabilities (Based on a Survey of 96 Utility Executives)
30%
25%
20%
15%
10%
5%
0%
Digital Transactions
Proactive Alerts & Notifications
Contact Center Next Best Action
Advanced CSR Tools
Social Media Management
17.7%
Campaign Management
16.7%
15.6% 15.6%
Cross-channel Consistency
14.6% 14.6% 14.6% 14.6%
Preference Management
13.5%
Customer Analytics/Business Intelligence
11.5%
10.4%
Targeted Web Marketing
9.4%
Segmentation & Personalized Content
6.3% Mobile Applications
Digital Marketplace
360 Degree View of Customer
Loyalty & Rewards Programs
24.0% 24.0%
Very
Confident
24.0%
24.0%
17.7%
16.7%
15.6%
15.6%
14.6%
14.6%
14.6%
14.6%
13.5%
11.5%
10.4%
9.4%
6.3%
(Source: Navigant Research)
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in whole or in part, without the express written permission of Navigant Consulting, Inc.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
As shown in Chart 1.3, the CE capabilities gap measured between 36% and 54% across
the top five most important customer engagement capabilities.
Chart 1.3
Confidence Gap across Top 5 Most Important CE Capabilities
360 Degree View of Customer
Capabilities Gap
9.4%
59.4%
24.0%
Proactive Alerts & Notifications
60.4%
Contact Center Next Best Action
17.7%
61.5%
24.0%
Digital Transactions
69.8%
Advanced CSR Tools
16.7%
70.8%
Very Confident
Very or of Utmost Importance
(Source: Navigant Research)
Overall, respondent confidence levels were relatively low
across all 15 CE capabilities, with less than one in four
expressing high confidence in their ability to perform any of
the capabilities; for most capabilities, respondent confidence
level was very high for fewer than 20%.
Utility executives do
not feel their current
capabilities are able to
deliver what they
consider to be top CE
capabilities, such as
having a single view of
the customer (360
Degree View), the
ability to send proactive
alerts and notifications,
enabling customer
service representatives
(CSRs) with analytics
(Next Best Action), and
their ability to provide
effective self-serve
options (Digital
Transactions).
Additional survey questions related to utility efforts surrounding their web presence,
analytics efforts, and outbound communications, as well as their attitudes toward building
or buying solutions and whether or not their company is investing in cloud-based or
software as a service (SaaS) technologies. Utilities are increasingly shifting away from the
traditional IT delivery models (building and maintaining solutions themselves) and moving
toward relying on third-party SaaS providers to either enhance or add new CE capabilities.
Survey respondents were also asked about which factors they expect to be the most
disruptive to the industry over the next 5 years.
In conjunction with the survey, Navigant also interviewed more than a dozen high-level
utility customer service executives. The results of the quantitative and qualitative findings
of the survey and executive interviews are the subject of this white paper. Section 2
describes key findings of the study, and Section 3 outlines the methodology used.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 2
KEY STUDY FINDINGS
2.1
The Customer Engagement Capabilities Gap Is Wide
Study findings indicated a clear appreciation for the importance of advanced Customer
Engagement (CE) capabilities as the power industry evolves. Executives understand that
customers have come to expect more service options and technologies, such as those
offered by mobile carriers, banks, and other leading industries. Advanced service
capabilities (including mobile apps, web-based self-service, efficient call center capabilities,
chat, etc.) are all expected today. But the survey and interviews with utility executives
highlighted a measurable gap between where utility industry participants would like to be
and where they are: the capabilities gap.
The capabilities gap measured between 62% and 86% for the 15 capabilities evaluated, as
shown in Chart 2.1. Specifically, for each respondent that rated a capability as “Very
Important” or “Of Utmost Importance,” the green segments in Chart 2.1 identify the
percentage of respondents that were “Very Confident” in their current ability to perform. The
highest levels of confidence were reported for Campaign Management, Proactive
Alerts/Notifications, Targeted Web Marketing, Digital Transactions, and Social Media
Management.
Chart 2.1
Where Capability Considered “Very” or “Of Utmost Importance,” Percent That Were
“Very Confident” in Their Current Ability (Based on a Survey of 96 Utility Executives)
100%
Cross-Channel Consistency
Contact Center Next Best
Segmentation & Personalization
Advanced CSR Tools
Digital Marketplace
Mobile Applications
Preference Management
Loyalty & Rewards
38%
360 Degree View of Customer
34%
34%
31%
30%
27%
27%
24%
24%
22%
21%
20%
20%
16%
14%
30%
20%
10%
Target = 100%
Customer Analytics/BI
40%
Social Media Management
50%
Digital Transactions
60%
Targeted Web Marketing
70%
Proactive Alerts/Notif.s
(% Responding "Very Confident")
80%
Campaign Management
90%
0%
(Source: Navigant Research)
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Overall, however, confidence levels were relatively low. Fewer than two in five respondents
selected “Very Confident, We Do It Better than Most” in relation to any of the 15 capabilities
evaluated. Less than one in five were “Very Confident” about their ability to perform
Preference Management, Loyalty & Rewards Programs, or having a 360 Degree View of
their customers (also referred to as the Single View of Customer).
Chart 2.2
Percent of Respondents That Were “Very Confident” in CE Capabilities (Based on a
Survey of 96 Utility Executives)
30%
25%
20%
15%
10%
5%
0%
Digital Transactions
Proactive Alerts & Notifications
Contact Center Next Best Action
Advanced CSR Tools
Social Media Management
17.7%
Campaign Management
16.7%
15.6% 15.6%
Cross-channel Consistency
14.6% 14.6% 14.6% 14.6%
Preference Management
13.5%
Customer Analytics/Business Intelligence
11.5%
10.4%
Targeted Web Marketing
9.4%
Segmentation & Personalized Content
6.3% Mobile Applications
Digital Marketplace
360 Degree View of Customer
Loyalty & Rewards Programs
24.0% 24.0%
Very
Confident
24.0%
24.0%
17.7%
16.7%
15.6%
15.6%
14.6%
14.6%
14.6%
14.6%
13.5%
11.5%
10.4%
9.4%
6.3%
(Source: Navigant Research)
Interview findings supported the survey results and also demonstrated where current initiatives are
underway to narrow the capabilities gap.
What utilities are saying on the Single View of Customers…
“We don’t have anything that gives us that 360 degree view of the customer.
In an outage, when a customer calls, the rep that’s handling that call or even
if the customer goes through the web, we cannot customize the response to
that customer’s current or previous experience. So we’re investing in a data
lake, which is going to hopefully connect all the dots and all the data
associated to that customer, so when the rep does have that customer on
the line we understand who’s calling, what their past and current
experiences are, and we can customize how we handle those customers,
how we speak to them, and what information we provide to them based on
that historical view.”
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Bridging the Divide: Utilities and the Customer Capabilities Gap
The study found that analytics
maturity is still in its early stages
for utilities and is changing
rapidly.
While the biggest pain point was
deployment, there was no
discernable pattern as far as the
approach—utilities varied in their
approach to adding and/or
improving existing analytics
capabilities both organizationally
and in terms of buying behavior.
What utilities are saying about
Analytics…
“The idea is to create a “sandbox” that will
allow data scientists to do customized
analytics. The problem today is that we just
don’t have good access to our sources of
data. We have these highly trained data
scientists, but they can’t get their hands on
data. So part of this business
intelligence/data analytics strategy is to
create a platform they can use to do
customized analytics.”
Utilities’ lack of confidence in their current level of CE capabilities maturity and
sophistication is driving a shift away from traditional IT models. A majority of the surveyed
utilities favor buying over building IT solutions, as seen in Chart 2.3 below.
Chart 2.3
Does Your Organization Favor Building or Buying IT Solutions?
Build
41%
Buy
59%
(Source: Navigant Research)
Notably, Targeted Web Marketing was felt to be an area of strength for many survey
respondents and an area of weakness for others. This bifurcation is likely a result of
timing. As learned in the interviews, while many utilities have already undertaken major
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Bridging the Divide: Utilities and the Customer Capabilities Gap
web projects over the past few years, others recently have made only incremental
improvements to their web presence and anticipate greater investment to come.
Generally, utilities tend to move through three different stages of maturity in their digital
customer experience, as displayed in Figure 2.1.
Figure 2.1 Digital Customer Experience Stages of Maturity
(Source: Navigant Research)
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Bridging the Divide: Utilities and the Customer Capabilities Gap
2.2
Interest in Cloud/SaaS on the Rise
In response to the greater demands utilities are seeing placed upon their customer service
organizations, not only is expanded investment underway, but in many cases utilities are or
are planning to purchase third-party software as a service (SaaS). This is a strong
indication of utilities shifting away from the traditional IT delivery models within their
customer service organization (in other words, building systems and applications
themselves) and moving toward relying on third-party SaaS providers (i.e., buying the
capabilities they need). A majority (59%) of survey respondents indicated that they prefer
buying new solutions to building; notably, more than three-quarters of respondents said
they are either using or are interested in using cloud-based or SaaS solutions, as shown in
Chart 2.4.
Chart 2.4
How Interested Is Your Utility in Using Cloud-Based or SaaS Solutions? (Based on a
Survey of 49 Utility IT Executives)
We are using them, and we
plan to shift a significant
number of applications to the
cloud over the next 5 years
18%
We are using them,
but we only plan to
continue using them
for limited
applications
27%
We aren't using them,
and management
does not support
cloud-based solutions
24%
We aren't using them
now, but there is interest
in SaaS/cloud-based
solutions in the future
31%
(Source: Navigant Research)
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Many utilities are realizing their agility
and speed to market are considerably
lagging in order to improve and/or
deliver new CE capabilities. A majority
of the utilities interviewed stated they
have already engaged in third-party
SaaS partnerships in order to deliver
better CSR tools in their contact centers,
obtain customer insight (propensity
algorithms, behavior analytics, etc.), and
to drive IT costs down. In addition, more
and more utilities are planning to shift
their applications to the cloud. Although
utilities still are unable to capitalize all
software, as heard in the interviews, this
barrier is something that utilities are
willing to push against and find ways to
do the right thing both from an
operational as well as a customer
satisfaction point of view.
What utilities are saying on
build vs. buy…
“We’re out of the era now where we
can build it ourselves. We’ve been
caught too many times with legacy
systems and nobody knows what’s
under the hood. Even if we have to pay
a bit more, it’s better to get a service
provider. It is the trend, cloud-based
SaaS. The debate over operating
versus capital budgets is a huge
distraction. Frankly, it’s impeding the
right decision.”
“A lot of software can’t always be
capitalized, so has to come out of our
operating dollars. ... The more the
companies can give us things that can
have multiple uses for them, but
aspects of it are customized to us—
that’s the kind of thing that becomes
cost-effective and that becomes a winwin.”
Some respondents noted that customer
data has to stay onshore, but for those that have chosen to move more functionality to the
cloud, their confidence in security was high. As one interviewee noted, “We went through a
very strenuous security evaluation. The external providers are better at security than we
are.”
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Bridging the Divide: Utilities and the Customer Capabilities Gap
2.3
Evolution of CE Platform in an Effort to Increase Customer Satisfaction
While Keeping Costs Low
More than half of the survey respondents indicated that improving customer satisfaction is
their top customer service business goal, followed by reducing IT/OT expenses and cost-to
serve (Chart 2.5).
Chart 2.5
Top Customer Service Business Goals (Based on a Survey of 96 Utility Executives)
Reducing IT or
OT Costs
16%
Protecting Customer
Information
1%
Reducing Cost-to-Serve
16%
Increasing Digital
Engagement
4%
Increasing
Revenue
11%
Increasing Customer
Satisfaction/NPS
52%
(Source: Navigant Research)
Traditionally, customer information systems (CISs) have been the central supporting
technology in customer service. Utilities have used CISs as a system of record across the
meter-to-cash processes—everything from metering to billing and payments, collections,
and contact data are stored and managed by the CIS platform. Many call centers still use
CISs as a primary CSR tool to manage phone interactions. Naturally, most improvement
strategies used to (and some still do) focus on CIS enhancements. The study suggests
that while CISs continue to remain central assets and a priority in customer reference
architecture, more executives are exploring the value in moving toward a more federated,
services-based architecture that enables greater customer experience via agile edge
capabilities that surround the CIS. This surround strategy accomplishes a few objectives:

The CIS will continue to be the system of record for many critical customer data
elements and can remain fixed for longer periods

Digital transactions and omnichannel management can continue to evolve without
needing to rip out and replace the core CIS
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Bridging the Divide: Utilities and the Customer Capabilities Gap

Allows contact centers to organize data and transactional screens that accelerate
contact resolution (i.e., providing ways for CSRs to have a single view of a customer in
one place, proposing next best actions, revealing propensities based on analytics, etc.)
Nearly all interviewees have detailed, multiyear roadmaps with investments that cut across
the technology landscape, ranging from CIS replacements to additions to or improvements
of those capabilities external to CIS (such as websites, contact center tools, CRM,
analytics, etc.). These findings were consistent with the survey results shown in
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Chart 2.6—a majority of investments are going toward CIS Upgrade or Replacement
(21%), Call Center Tools/Applications and CRM (15% each), closely followed by
investments in Websites and Billing/Rates Engines (13% each). Examples of this varied
investment strategy are reflected in the quotes below:
What utilities are saying about CE investments…
“It’s just cost-prohibitive to do a full-blown CIS replacement because we’ve automated
so many processes within our CIS, so it’s more of how can we build things that work
either inside or outside of it that can just add that additional functionality without having
to rip out the guts and build from scratch.”
“We have a brand new billing system we put in a year ago … state of the art. But it is
only the billing and call center machine. We have an outsourced call center and the
contract is about to expire. We’re going out to market to see what is the art-of-thepossible … to give us all of the things a modern interface would give—things like all the
channels available, live transfer, live chat, virtual calling—all the things that other
industries take for granted but utilities don’t. We’re taking a giant leap in this space—this
is the biggest priority now for our company.”
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Chart 2.6
Greatest CE Investment Over the Next 3 Years (Based on a Survey of 96 Utility
Executives)
Billing/Rates
Engines 13%
Website
13%
Call Center
Tools/Applications
15%
CIS Upgrade or
Replacement
21%
Analytics/BI
Software
11%
Customer
Preference Center
4%
Marketing Automation/Outbound
Communications
8%
Customer
Relationship
Management (CRM)
15%
(Source: Navigant Research)
2.3.1
Voice of the Customer Drives Process and Technology Improvements
As part of their mission to improve customer satisfaction, several utilities interviewed noted
that they had undertaken voice of the customer studies—considering both what the
customers are saying (e.g., via surveys and focus groups) and what the data is revealing in
terms of interaction, habits, and behaviors (e.g., analyzing the omnichannel experience—
why customers are dropping out of self-serve channels, what propensities they have in
how they prefer to receive bills, conversion rates to digital channels and/or transactions,
etc.). Utilities are increasingly analyzing customer interactions across all channels in order
to better understand how to best address changing needs—and also to convince senior
leadership of the need for change. Several noted that it was the best way to garner support
for multi-million dollar investments.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Interviewees indicated that greater training is being done for CSRs, along with new
processes and tools that emphasize active listening and engagement rather than a scriptbased, tick-the-box system.
“Our systems need to be very easy to use. There’s a lot of low-hanging fruit there,
where we can do better. We’ll be using analytics to determine WHY people are
calling; provide the CSRs with the three most likely reasons for the call right on their
screen.”
Providing situational awareness to CSRs via an all-in-one tool continues to be the most
important feature in delivering first call resolution, preventing rework, and providing a more
effective overall customer service.
“Part of what we’re buying in this (third-party SaaS) arrangement will be a CSR tool
that provides analytics to the CSR—ours is a bit challenging right now because it
requires the CSR to have multiple screens especially when they’re working off the
old CIS—that in and of itself involves a lot of screens. … I’d like it to be able to do
two things: one is create an awareness of who the customer is—whether it’s a 360
degree view of the customer or not, at least give the agent some sense of what the
customer has tried to do with us in the past. Then provide some greater diagnostic
ability for high bill calls—those tend to be the longest calls and tend to lead to other
downstream work having to happen because we can’t address the customer’s
concern on the first call.”
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Bridging the Divide: Utilities and the Customer Capabilities Gap
2.4
Analytics Critical to Improving the Customer Journey
Among the executives interviewed, virtually all noted a variety of analytics efforts underway
related to improving their customer journey. Nearly one-third of survey respondents
indicated that their highest priority in terms of analytics solutions is for revenue
management; this attitude was echoed in interviews:
“We’ve been doing a lot of revenue protection analytics, they created a dedicated IT
team, and they’re setting up databases and tables and data warehouses. They’re
pulling from all the disparate sources of data—from our billing system, from our
meter system, from the outage system, even from asset management and service
order type work. They’re pulling it all together so that we can analyze that data.”
Chart 2.7
Highest Priority in Analytics Solutions
Program Management:
Results, Participation,
Opt Outs
18%
Revenue
Management
32%
Web Engagement:
Engagement
Tracking
5%
Segmentation
4%
DER: EV Detection,
Solar Detection
1%
Contact Center Analytics:
Propensity to Call, Call
Drivers, Handle Time
16%
Marketing: Marketing
Effectiveness,
Propensity to Participate
8%
Load Forecasting
16%
(Source: Navigant Research)
Program management was the second greatest priority among survey respondents,
followed by contact center analytics (propensity to call, handle time) and load forecasting.
“We are using analytics to drive Conservation and DSM [CDM programs] messaging
and customer care messaging, smart inserts and smart emails, etc. For us, it would
continue to be the priority…”
Others interviewed indicated a desire for analytics for targeted marketing and website
personalization. Cleansing and integrating data sources is also a big challenge for utilities:
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Bridging the Divide: Utilities and the Customer Capabilities Gap
“In customer experience, we’ll hire a similar platform provider that will give us an
integrated data analytics capacity. In addition to that, the idea is to create a
‘sandbox’ that will allow data scientists to do customized analytics. The problem
today is that we just don’t have good access to our sources of data. We have these
highly trained data scientists, but they can’t get their hands on data. So part of this
business intelligence data analytics strategy is to create a platform they can use to
do customized analytics.”
The biggest pain point was deployment. More than 50% of respondents stated their biggest
pain was deployment, which was twice the number for data integration and data discovery.
Chart 2.8 Related to Customer Engagement Analytics, What is Your Biggest Pain Point?
Deployment Internal DecisionMaking
22%
Deployment Application to
Customer Programs
30%
Cleansing &
Integrating Data
Sources
23%
Data Discovery/ Data
Science
25%
(Source: Navigant Research)
2.5
Industry Disruption Coming from Many Directions
Survey respondents and interview participants were asked about what they see as being
most disruptive to their business over the next 5 years. More than 30% of survey
respondents cited increased regulatory requirements as the greatest disruptor. Importantly,
20% of survey respondents felt that customer expectations will present the greatest
disruption in the industry over the next 5 years. And, without exception, the executives
interviewed emphasized the importance of their CE strategies in remaining competitive and
relevant as the industry evolves:
“The utility of the future is absolutely not going to look like it does today. Even from a
customer service point of view. So we’re looking at customer service components,
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Bridging the Divide: Utilities and the Customer Capabilities Gap
and stickiness, how loyal are our customers? If there are other providers out there,
would they choose us as their #1 choice? We need to position ourselves to be there,
such that we are their #1 choice.”
"We need to move into much more designed-focused approach stuff, spend much
more time on human-centered design, learn really how our customers live, so we’re
much more able to design a power system that is responsive to what they’re trying
to do."
Chart 2.9
Which of the Following Will Cause the Greatest Disruption to Your Utility Over the Next
5 Years? (Based on a Survey of 96 Utility Executives)
35%
Most
Disruptive
30.5%
30%
25%
20%
20.0%
15%
11.6%
10.5%
10%
8.4%
8.4%
Increased regulatory requirements
30.5%
Customer expectations
20.0%
Pressure on traditional utility
business model
11.6%
Growing solar penetration
10.5%
Increasing use of Time of use (TOU)
or dynamic rates
8.4%
Declining demand
8.4%
Widespread adoption of EVs
6.3%
Competition
4.2%
6.3%
4.2%
5%
0%
(Source: Navigant Research)
Executives interviewed understand that third-party competitors—solar, electric vehicles,
etc.—can all be viewed as both threats and opportunities. Several mentioned that price
parity with solar is only a few years away, and that they are evaluating or moving into
utility-scale solar as a result. Others have embraced a proactive strategy with relation to
electric vehicle charging networks so as to preempt third parties from owning those
customers.
2.6
Concluding Remarks
Providing a positive customer experience journey—and acquiring and integrating the
accompanying technology necessary to do so—represents one of the greatest challenges
facing utilities today. Industry participants are seeking cost-effective and flexible solutions
that they can manage with agility in a rapidly changing operating environment. Over the
next 5 years, considerable investment will be made in a multitude of CE capabilities where
technology gaps exist today. These will include a more holistic, 360-degree view of
customer interactions, greater self-service capabilities on the web, and analytics solutions
to protect revenue and more effectively direct call center personnel and marketing
programs.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
In response to these increased needs for flexible, agile, and state-of-the-art technology
solutions, utilities will increasingly be willing to use cloud-based or SaaS offerings. Utility
leaders and regulators are (slowly) coming to understand that total cost of ownership may
not be the most important investment driver in the long run.
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19
Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 3
UTILITIES AND THE CUSTOMER CAPABILITIES GAP:
STUDY METHODOLOGY
3.1
Overview
In February and March of 2016, Navigant Research (Navigant) undertook an in-depth
study designed to assess the status of CE capabilities and associated technology trends
with electric utilities. In particular, the study included a targeted online survey of utility
executives in strategic planning, customer service, or IT roles, as well as in-depth
interviews of more than a dozen high-level utility customer care executives. The goals of
the study were to gain a deeper understanding of the following:
3.2

The CE capabilities that utilities believe are most important to engaging their
customers

The technologies, systems, and processes that utilities currently have (or do not have)
in place to drive CE

The key trends in utility CE investments

The disruptive change coming to the utility industry as identified by study participants,
and how CE investments are being made in anticipation of those changes
Survey Methodology
Nearly 100 qualified utility executives responded to the online survey. Their functional roles
were split between the IT, marketing, management, operations, and customer service
departments, with approximately 87% involved in either IT or direct customer service roles.
Respondents were located throughout the United States and divided relatively evenly
between regions.
Survey respondents were asked to rank the importance of 15 specific CE capabilities and
then asked to evaluate how well their utility presently delivers those capabilities. These
capabilities are defined in Table 3.1.
Depending upon functional role, additional questions were asked related to company
strategy for web presence, IT and analytics investments, outbound communications
capabilities, and strategies, as well as to identify what they perceive to be the most
disruptive industry trends on the horizon. Respondents were also polled as to the energy
usage insights that they presently make available to their customers.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Table 3.1
CE Capabilities Defined
CE Capability
Advanced CSR Tools
Contact Center Next Best Action
360 Degree View of Customer
Preference Management
Loyalty & Rewards Programs
Targeted Web Marketing
Campaign Management
Digital Marketplace
Social Media Management
Proactive Alerts & Notifications
Mobile Applications
Digital Transactions
Segmentation & Personalized
Content
Customer Analytics/BI
Cross-channel Consistency
Definition
Single CSR view of customer, including predictive
analytics, usage and bill analytics, high bill analytics in
order to decrease average handle time and increase
first call resolution.
The ability to surface for reps a recommended 'next
best action' tailored based on what is known about that
customer.
All customer information in one place and accessible
to a business user for analytics and customer
research.
Managing opt in/opt out and channel preference
across all communications, and giving customers the
ability to update their preferences.
Rewards programs to incentivize customer behavior.
Ability to surface different offers or promotions on web
tailored to different segments of customers.
Managing outbound campaigns for marketing,
program engagement, etc.
An online marketplace where customers can compare
the energy ratings of products and/or purchase them.
Monitoring social media; engaging via social media for
customer service or marketing.
The ability to send alerts based on triggers, such as a
peak day event or upcoming high bill or outage.
Mobile apps available for download (not mobileresponsive web).
Online/mobile payment, autopay, online/mobile
start/stop service.
Ability to send outbound communications with
personalized insights to different customer segments.
Analytics applications that support CE efforts.
Consistency of message across channels: web,
outbound, CSR, etc.
(Source: Navigant Research)
3.3
Executive Interviews
For a deeper view into the current state of utility CE initiatives and investments, and in
order to understand the more qualitative factors behind utility priorities and technology
choices, Navigant spoke with 14 high-level customer care executives.
In this white paper, the statistical survey results have been analyzed alongside the in-depth
interview findings in order to provide a comprehensive assessment of the existing utility
customer experience journey, including the current state of power utility CE capabilities
and where technology gaps may lie.
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 4
TABLE OF CONTENTS
Section 1 ...................................................................................................................................................... 1
Executive Summary .................................................................................................................................... 1
1.1
Introduction.................................................................................................................................... 1
1.2
Study Overview and the Capabilities Gap .................................................................................... 2
Section 2 ...................................................................................................................................................... 5
Key Study Findings ..................................................................................................................................... 5
2.1
The Customer Engagement Capabilities Gap Is Wide ................................................................. 5
2.2
Interest in Cloud/SaaS on the Rise ............................................................................................... 9
2.3
Evolution of CE Platform in an Effort to Increase Customer Satisfaction While Keeping Costs
Low
11
2.3.1
Voice of the Customer Drives Process and Technology Improvements ............................... 13
2.4
Analytics Critical to Improving the Customer Journey ................................................................ 15
2.5
Industry Disruption Coming from Many Directions ...................................................................... 16
2.6
Concluding Remarks ................................................................................................................... 17
Section 3 .................................................................................................................................................... 19
Utilities and the Customer Capabilities Gap: Study Methodology ..................................................... 19
3.1
Overview ..................................................................................................................................... 19
3.2
Survey Methodology ................................................................................................................... 19
3.3
Executive Interviews ................................................................................................................... 20
Section 4 .................................................................................................................................................... 21
Table of Contents ...................................................................................................................................... 21
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 5 .................................................................................................................................................... 23
Table of Charts and Figures..................................................................................................................... 23
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Section 5
TABLE OF CHARTS AND FIGURES
Chart 1.1
Top Customer Service Business Goals (Based on a Survey of 96 Utility Executives) ........... 2
Chart 1.2
High Confidence in CE Capabilities (Based on a Survey of 96 Utility Executives) ................. 3
Chart 1.3
Confidence Gap across Top 5 Most Important CE Capabilities .............................................. 4
Chart 2.1
Where Capability Considered “Very” or “Of Utmost Importance,” Percent That Were “Very
Confident” in Their Current Ability (Based on a Survey of 96 Utility Executives) .................... 5
Chart 2.2
Percent of Respondents That Were “Very Confident” in CE Capabilities (Based on a Survey
of 96 Utility Executives) ........................................................................................................... 6
Chart 2.3
Does Your Organization Favor Building or Buying IT Solutions? ........................................... 7
Chart 2.4
How Interested Is Your Utility in Using Cloud-Based or SaaS Solutions? (Based on a Survey
of 49 Utility IT Executives) ....................................................................................................... 9
Chart 2.5
Top Customer Service Business Goals (Based on a Survey of 96 Utility Executives) ......... 11
Chart 2.6
Greatest CE Investment Over the Next 3 Years (Based on a Survey of 96 Utility
"Executives) ........................................................................................................................... 13
Chart 2.7
Highest Priority in Analytics Solutions ................................................................................... 15
Chart 2.8
Related to Customer Engagement Analytics, What is Your Biggest Pain Point? ................. 16
Chart 2.9
Which of the Following Will Cause the Greatest Disruption to Your Utility Over the Next 5
Years? (Based on a Survey of 96 Utility Executives) ............................................................ 17
Table 3.1
CE Capabilities Defined......................................................................................................... 20
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Bridging the Divide: Utilities and the Customer Capabilities Gap
Published 2Q 2016
©2016 Navigant Consulting, Inc.
1320 Pearl Street, Suite 300
Boulder, CO 80302 USA
Tel: +1.303.997.7609
http://www.navigantresearch.com
Navigant Consulting, Inc. (Navigant) has provided the information in this publication for informational
purposes only. The information has been obtained from sources believed to be reliable; however,
Navigant does not make any express or implied warranty or representation concerning such information.
Any market forecasts or predictions contained in the publication reflect Navigant’s current expectations
based on market data and trend analysis. Market predictions and expectations are inherently uncertain
and actual results may differ materially from those contained in the publication. Navigant and its
subsidiaries and affiliates hereby disclaim liability for any loss or damage caused by errors or omissions in
this publication.
Any reference to a specific commercial product, process, or service by trade name, trademark,
manufacturer, or otherwise, does not constitute or imply an endorsement, recommendation, or favoring by
Navigant.
This publication is intended for the sole and exclusive use of the original purchaser. No part of this
publication may be reproduced, stored in a retrieval system, distributed or transmitted in any form or by
any means, electronic or otherwise, including use in any public or private offering, without the prior written
permission of Navigant Consulting, Inc., Chicago, Illinois, USA.
Government data and other data obtained from public sources found in this report are not protected by
copyright or intellectual property claims.
Note: Editing of this report was closed on May 12, 2016.
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in whole or in part, without the express written permission of Navigant Consulting, Inc.
25