When selling a commodity in an intensely competitive market, the companies that engage with, listen to and act on what their customers tell them will be the winners, says Sean Farrington.

With a recent history of privatisations, acquisitions, mergers and regulatory interventions, the big six UK utilities have found themselves at the sharp end of the political, customer and competitor experience. They still provide gas and electricity to more than 50 million people in Britain, or more than 90 per cent of domestic customers, but between 2009 and 2014 they suffered a collective 7 per cent drop in market share.

All the larger players are increasingly under attack from smaller, independent suppliers. Some offer innovative products, such as Co-op Energy’s community renewable projects. Others such as Ovo score on customer service, attracting accolades from Which?, which put it first in an energy customer survey, with a score of 82 per cent. What they have in common is a focus on the customer – building services, products and systems around them.

When selling a commodity, only your price and service can set you apart, and in an intensely competitive commercial climate, the companies that engage with, listen to and act on what their customers tell them, will adapt.

Rich customer insight

EDP, one of Portugal’s biggest companies, is the largest generator, distributor and supplier of electricity in Portugal and the third-largest electricity generation company in the Iberian peninsula. It has a long heritage and is active in 14 countries, with 9.8 million electricity customers, 1.5 million gas customers and 12,000 employees around the world. Just like the UK big six, EDP faced issues of market liberalisation and the need to be competitive with new players by maintaining affordable costs.

EDP is no ordinary utility, however. It ran Portugal for one day entirely on renewable energy. The design of its offices is breathtaking, and the company designed and built its own museum dedicated to modern art. “Energy as the New Art” is its strapline.

In its public documentation, EDP lists its values as “initiative, trust, excellence, ­sustainability and innovation”. Its annual report highlights “a strong customer relationship” with a desire to “place itself in the clients’ shoes whenever a decision has to be made, to listen to clients in a clear and ­simple manner and to surprise them by anticipating their needs”.

EDP’s interim report also puts solid metrics alongside its corporate goal of “developing our people and reinforcing trust”, with a customer satisfaction score of 76 per cent and an employee engagement score of 74 per cent. It highlights the company’s victory at the European Excellence Awards in HR 2017 for implementing strategies and practices in response to modern challenges in people management.

Just over a year ago, EDP signed up Medallia to innovate a customer experience (CX) programme around its unique corporate culture, in a sector not traditionally known for the quality of its customer outreach. Recently, the company held a one year party for its employees, to celebrate the results of its programme, its tangible return on investment and the involvement it had inspired among EDP’s employees.

Success in 90 days

In the intervening months, EDP reported a seven-point improvement in its net promoter score. Data started to flow from the operational to the strategic level and management took a keen interest in customer-facing issues. Closed loops were created to spotlight customers at risk of leaving and the company innovated 35 separate practices in Portugal and Spain aimed at boosting the customer experience. Videos that championed customer centricity were created and play in the company HQ’s lifts. The first signs of success came only 90 days into the programme, after a period of intensive employee engagement.

EDP adopted a structured approach to guarantee robust levels of customer centricity:

1.    Mapping customer journeys and determining the moments of truth around which to structure a robust voice of the customer programme;

2.    Attracting more than 400,000 feedback responses in 18 months from customers across all segments and channels;

3.    Implementing Medallia and integrating the data with operational data across the commercial areas involved in the ­programme and Medallia;

4.    Providing access to the feedback to ­hundreds of employees across channels;

5.    Closing the loop with customers on a systematic basis, with more than 30,000 customer cases closed over the last 18 months – a complex process due to volume and capacity. EDP developed standardised approaches to the problem and trained a centralised team;

6.    A continual distribution of internal marketing communications around the programme designed to maintain momentum and ensure high user engagement;

7.    Reiterating the importance of CX across the organisation by diffusing videos and recordings of management successfully closing the loop;

8.    Organising an anniversary event to ­celebrate successes and share plans for the next stage in the transformation;

9.    Analysing the feedback received during huddles and identifying opportunities that boost CX.

To elevate energy generation into an art form, EDP has made a work of art of its CX management. EDP puts its customers first by creating a culture that thrives on actively monitoring how management practices align with customer-centric values and priorities –and acting on lessons learnt.

It does this by aligning its customer engagement initiatives hand in hand with its employees, ensuring they are customer-­facing by communicating best practice, sharing results and celebrating achievements. EDP shows how robust employee engagement is good business, driving innovation and dramatically improving the customer experience. In a cycle of dependency, the employee is the strongest link with which to maintain customer trust and connectivity. You can’t have one without the other.

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