The problem stems from utilities’ long-standing assumption that the best that can be striven for is invisibility. That’s an argument you still sometimes hear from members of energy network companies and some in the water industry who say: “It’s our responsibility, and customers shouldn’t have to take an interest” – apart from continual messages to “use water wisely”.
That’s wrong for domestic customers, and positively dangerous for companies’ relationships with business customers.
Let’s look at the domestic sector. The argument of water companies that they should remain in “stewardship” of the water cycle would be a strong one – if it included all users. But the excellent work companies have done, for example on catchment management, doesn’t seem to reach most customers who use that water. We’ve been heading into drought for two years, but it has only been in the past few months that Thames has begun its seven regional river campaigns, including “Love the Lee”.
Giving domestic customers details about exactly where their water comes from, and how far it travels, is the start of involving customers in the long term. Local engagement would give the water companies freedom for a bolder response when a threatened drought hits. Instead of vague yet complex hosepipe bans, an active, measurable response – as shown by companies who have asked customers to sign a pledge to save 20 litres a day – is a natural next step if customers have been following the level of their local supply.
As for business customers, incumbents should be very afraid of their response to this year’s drought.
Water companies should have been in every large customer’s premises over the past year, talking about the approach of drought, offering water audits and working with them to cut their usage. By now they should be ready to extend that message and that help right down to small businesses.
But what we hear from Ofwat’s business customer forum is a tale of poor engagement and unsatisfactory service. It’s an astounding response when you think that over the same period, water companies have been watching the approach of retail competition.
If I were a water services company, or a competitive supplier in the Scottish market, I’d spend this year knocking on the doors of English customers. I’d offer audits, water storage and non-potable water supply options, plug leaks on site and offer to get them in good shape for the rest of the drought.
Smart new entrants can use the drought to get into position for when competition rolls in. The too little, too late approach of water companies is the perfect opportunity to steal their business customers.