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PA IN THE MEDIA

Customer 4.0: Welcome to the Next Gen customer experience

This article first appeared in Electric Light & Power.

Picture this…

While leaving work to go out to dinner on a hot evening, Jane receives a personalized text message on her smartphone from her utility, offering a rebate to cut back her air conditioning five degrees for two hours, because at this time, energy usage is high and clean energy cannot be secured. After accepting the offer, Jane receives a second message, asking if she would be interested in a plan to regularly reduce her energy usage. After clicking yes, she selects a restaurant using a reservation app and then uses her ride share app to arrange transportation.

Jane feels great about the situation. In this anytime-anywhere digital world, she seamlessly achieves cost savings, which she can use to pay for dinner, and she also has the opportunity to participate in an environmentally friendly demand reduction program.

This experience is representative of the kind of digital interaction Jane is likely to have with her Next Generation Energy company in the future, as utilities are in the midst of trying to put themselves in the center of the customers’ universe and help them meet their goals and aspirations. At PA Consulting Group, we refer to this effort as Customer 4.0.

Evolution to Customer 4.0 world

According to PA’s 2017 Utility Customer Experience Insights Study, which surveyed utilities across the US, collectively serving more than 28 million customers, we found that Jane’s experience could become common in the not-so-distant future.

Our study assessed the current and expected future level of maturity across the entire customer journey, as well as the strategic roadmap and foundational capabilities such as data and human skills required to deliver the desired experience. Companies like Amazon, Uber and Netflix have redefined the customer journey, raising the bar significantly, and utilities have taken notice.

While utilities currently provide an experience that spans the 2.0 and 3.0 stages on the Customer Experience Maturity scale, on average, many plan to evolve towards the 4.0 level within as few as three years. Today’s 2.5 experience is largely defined by the level of satisfaction a customer has with using basic self-service options delivered through a phone voice response system and/or largely unintegrated website, and new products and services introduced mainly in response to regulatory requirements. If basic metrics like minimal call answer times and abandonment rates are met, service is typically deemed to be “good.”

However, the study found that the expected 4.0 experience will be achieved by customers achieving their individual ambitions. Service will become omni-channel – seamlessly integrated and measured across all virtual and human contact points – to offer customers a full suite of energy management solutions.

Omni-channel service is precisely what helped Jane achieve her ambitions:

  • Rebate program for web-enabled thermostats: Jane’s recent application for a third-party partner’s rebate provided intelligence her air-conditioning could be remotely managed.
  • Smart meter: Recently installed AMI allowed energy usage in Jane’s home to be tracked real time providing an indication no one might be home.
  • Social media monitoring: Artificial intelligence picked up Jane’s potential interest in renewable energy resources by linking her email address to a recently joined chat room on rooftop solar programs.

Customer 4.0 in practice

Through our study, we learned that utilities striving to provide the full Customer 4.0 experience are pursuing the following seven initiatives:

  • Customer Experience Strategy: focus on the customer’s individual goals. This can be done, for example, by using creative two-way, crowd-sourced interaction.
  • Meter to Cash: root cause based revenue assurance is engrained in the corporate ethos with mass-customized options and near zero error rates.
  • Customer Service: anywhere and anytime available service delivered through multiple, integrated self-service channels provides low effort interactions for both the utility and its customers.
  • Field Operations: next generation information technology facilitated by data analytics, artificial intelligence and machine learning empowers a collaborative and de-centralized team.
  • Data and Analytics: multiple data sources routinely capture and provide high integrity information throughout the organization in real time.
  • New Products and Services: agile development and delivery of innovative and customized new products is engrained in the business model.
  • Foundational Capabilities: the customer experience is administered through cloud based CRM and fluid talent management focused on managing the total cost of customer ownership.

As part of our work with a large west coast multi-service utility to redesign the customer experience, we helped the utility to create a new, interactive text message outage notification process. This project is part of the utility’s customer experience transformation program designed to drive inquiries to the optimal channel.  Customers can receive a notice of current outages with estimated restoration times in real time, and also interact via text or the web to provide information to the utility during storms. Other utilities are planning similar initiatives.

So how can other utilities deliver such an experience? By thinking big, starting small, and scaling fast.

Recognizing customers are at the center of their own universe, not yours, is key to delivering a 4.0 experience. Helping customers navigate their own lives to achieve self-defined outcomes will keep utilities relevant.

Implementation begins with several small-focused initiatives that are often conducted in tandem to drive early and measureable success. As the utility’s ability to absorb change matures, larger initiatives can be rapidly deployed to ultimately redefine the target operating model based on the Customer 4.0 experience. Using this model, the utility can constantly make adjustments and improvements based on real-time measurement and insights into the customer journey.

Customer 4.0 in action

We understand this change will not be easy, but by applying a think big, start small and scale fast approach, this five step approach can help guide the transformation.

  1. Develop customer solutions: provide customer defined solutions to meet individual ambitions.
  2. Deploy mobile friendly technology: customers interact anywhere and anytime.
  3. Integrate service channels into a seamless experience: the web, mobile app and contact center is seen by customers as a single platform.
  4. Leverage data analytics to drive intelligence: information from the utility channels, social media and other sources is fully integrated and leveraged in real time.
  5. Customer centric target operating model: the organization’s operating model is redefined to deliver service defined by the seven attributes of a Customer 4.0 world.

Throughout this year, we will explore the five step approach to a Customer 4.0 experience in more detail, focusing on helping utilities achieve the experience.

 Wayne Lafferty is an energy and utilities expert at PA Consulting Group

Contact the author

  • Wayne Lafferty

    Wayne Lafferty

    PA energy and utilities expert

    Wayne is a utility regulatory, tariffs and rates expert with broad experience evaluating, designing and implementing water and electric service rates and other regulatory programs.

    Insights by Wayne Lafferty

Contact the energy and utilities team

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