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Creating The CX-Centric Utility

Matthew Guarini
Vice President, Research Director
April 26, 2018

Outage management is a defining moment for utilities and thus provides a great way to reimagine the relationship between utilities and their customers. Absent an outage, most consumers don’t give a whole lot of thought to their utility company — flip a switch, and the expected happens.

The outage — especially prolonged outages — changes everything.

No electricity stokes negative emotions. However, little things create positive ones. Truck sightings become exciting; field workers are seen as conquering heroes; and the utility can win (or lose) hearts and minds by the quality and accuracy of information and the fix.

But the utilities of today have more and bigger challenges to drive customer affinity: They want to change the engagement model to reduce costs, provide new solutions to counter nonregulated solutions, alter consumption behavior to drive energy efficiency, position for smart home services, and use customer advocacy as a lever for favorable treatment by regulators.

Changes in consumer behavior have reshaped the cable market, fueling the fate of over-the-top (OTT) providers like Netflix and Hulu. These same changes are also creating a dangerous level of churn in insurance, threatening the human advisor in wealth management — and creating risk that banks will become obsolete to a new fleet of fintech providers. They are, in a word, disruptive. This is the background for why customer experience (CX) is now a centerpiece of utility strategies but, more to the point, how CX will play a critical role to win, serve, and retain customers.

This disruption is starting to impact the utility market as consumers seek more energy options and greater energy efficiency, demand far better engagement (especially during outages), and begin to explore smart home solutions and other energy-related technologies. These changes are challenges on one hand and opportunities on the other. Utility leaders will use these opportunities to reframe their relationship with the customer, leveraging the principles of customer experience and, in turn, will change their key processes and operations to deliver the CX-centric utility.

As other industries struggle with adapting to digitally insatiable and empowered customers who are willing to switch allegiances based on a single, poor experience or one fabulously valuable one, utilities find themselves in a challenging position. Technology is enabling new entrants, and utilities need to better deliver experiences that customers value and regulators reward. The cost of delay or failure is a steady decline in customer base. This is not the time to sit back and apply a passive CX strategy — this is the time to place your company’s full energy behind CX.

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