By L. Dennis Smith
The Costs and Benefits of Customer Care
Forget all the marketing and sales hoopla. What utility companies want from their customer information systems is functionality that improves customer service and streamlines operations.
This is the reality for many energy providers that for years have relied on mainframe customer information system (CIS) applications. Utilities now realize their legacy systems may not be up to par when it comes to providing services customers expect, and they are eyeing investments in new technologies that improve on traditional CIS capabilities. Tapping the CIS to improve marketing and sales initiatives seems to have taken a back seat to improving on more traditional utility functions.
These are among recent conclusions drawn from a survey of customer care and IT professionals at 100 utilities as part of an annual study conducted by Chartwell Inc. The majority of surveyed utilities are either currently upgrading their customer systems (25 percent of respondents) or plan to upgrade in the next several years (40 percent of respondents). They continue to look at investing in new customer management systems-albeit at a slower pace than most vendors would prefer-or modernizing their existing CIS.
Integration with geographic information systems, call center technologies and providing more billing options topped the shopping list for utilities looking to improve their CIS capabilities (see Figure). Utility executives want to arm their front-line troops with the tools necessary to, among other things: inform customers of a pending work-order status, let customers know when the lights will be back on in real time, offer summary billing, better manage workflow, and tell consumers their account status.
Conversely, customer management functionality surrounding sales and marketing efforts were lower priorities.
Motivations for making improvements to the utility CIS have clearly changed in recent years. One factor remains a constant, however-the customer. When retail competition for energy sales was on the fast track a few short years ago, utilities looked at ancillary retail markets to hook customers. The potential for customer switching and the exchange of information with energy marketers was also on the horizon. Old legacy systems couldn’t handle it.
A subsequent backlash against customer choice in several states further confused an already uncertain industry. Utilities have in the past two years, for the most part, retrenched and renewed their focus on energy delivery and products that complement that service offering. Still, the customer remains. And those customers are becoming more demanding.
But for many utilities, customer service is still a cost rather than a value proposition. Right or wrong, most traditional utilities don’t view the customer contact center as a revenue generator. Therefore, utility decision makers faced with the need to invest in more customer-centric systems will expect a solid return on investment. Utilities want, on average, about a five-year payback before investing in a CIS upgrade or a software package to improve customer service, Chartwell’s study found.
Indeed, new customer management systems must improve workflow among customer service reps and streamline operations, while improving customer service capabilities. Once utilities upgrade their systems and get those customer service functions in order, the need for marketing and sales functionality will no doubt follow.
Dennis Smith is editorial and research director with Atlanta-based Chartwell Inc. For more information on The Chartwell CIS Report 2002, please call (404) 237-9099, or visit www.chartwellinc.com.