Nordic Marketing is one of the largest independent, non-utility electricity providers to retail customers in Michigan. Nordic supplies power to more than 1,700 large commercial and industrial (C&I) customers, including Ameritech, Johnson Controls and Marathon Ashland Petroleum.
Nordic started out in the Michigan “Consumer’s Energy Direct Access” pilot program of 1997 using a combination of stand-alone billing and accounting software packages to manage its customer accounts.
“In the early days of the pilot program, our C&I customer accounts were large in size but few in number,” said Richard Polich, Nordic Marketing’s vice president of operations. “Each customer had only one point of supply in the pilot program so we billed for one premise per account-nice and simple. This simplicity meant we could manage customer billing and credit information using assorted software tools and spreadsheets.”
But the system Polich described was only a short-term solution to get through the pilot stage. Nordic planned to upgrade and scale its customer information and billing technologies to cost-effectively manage large numbers of complex C&I customer accounts when the Michigan electric market effectively opened to all customer groups in September 2000.
Nordic early on recognized that multi-premise C&I customers would seek the convenience of consolidated and customized bills from their electric retailer of choice when official deregulation unfolded. Nordic sought to deploy an advanced customer management system that would deliver this competitive edge.
The new system also needed to scale to support multiple, complex rate structures as part of Nordic’s competitive pricing strategy. Nordic offers its customers the flexibility to negotiate individual rate plans suited to their specific business needs, resulting in customer cost savings, greater customer satisfaction and improved margins for Nordic.
Record Time Implementation
In July 2000, Nordic made the decision to implement Peace Software’s Energy suite for C&I customer management. This marked the start of an intense 10-week implementation project to deliver complex C&I billing capabilities ahead of the official opening of the Michigan electric market.
The new system installation worked as a catalyst to refine and formalize Nordic’s business processes. Nordic prides itself on its ability to offer competitive, flexible pricing plans tailored to individual customer needs. Consequently, billing was a top challenge and priority for the Peace implementation team.
The team focused on analyzing and setting up complex tariff structures to support Nordic’s competitive pricing strategy. Nordic customers can pay under separate contracts with Nordic and their distribution company, or negotiate a single contract with Nordic for payment of both distribution and retail charges. For customers that opt for a single contract, they can choose to pay their old utility rate at a discount or establish a customized rate.
“In addition to capturing monthly meter readings, we had to aggregate meter data for multiple premises spread across different UDCs (utility distribution companies) and bill according to each individual client contract,” said Celia Young, Peace Software project manager. “This was no easy task-one customer had in excess of 1,100 premises with a number of premises having multiple meters.”
Young continued, “To add to the challenge, we had 10 weeks to customize, install and load the new system.
Ultimately, Nordic Marketing and the Peace implementation team were up to the challenge. And Energy was up and running within the 10-week time frame.
Nordic’s Complex Billing Advantage
In just three months using Energy, Nordic scaled to handle 1,500 new customer accounts.
According to Bruce Schlansker, Nordic’s vice president of marketing, Energy lets Nordic grow and diversify its C&I customer base. “Whereas our competitors face hefty overhead costs in managing complicated customer accounts, we can efficiently and profitability service all C&I customer types, whether they be large or small volume, multiple or single premise,” Schlansker said.
Energy’s flexible billing engine allows Nordic to set up and manage customized rate contracts, bill presentations and payment dates. Nordic now has the ability to offer its customers the convenience of single consolidated bills for their multiple premises and meters. This reduces the customer’s accounts payable workload and saves Nordic money in transaction costs.
Nordic can produce invoices that meet their customers’ needs and negotiate different payment cycles to suit their customers’ internal business processes. For example, one large customer prefers a consolidated invoice in electronic spreadsheet format for its 1,000 premises, which the customer automatically downloads into an accounts payable system to pay in one lump sum. Prior to signing with Nordic, this same customer received 1,000 separate invoices with disparate payment dates.
Nordic plans to take on 1,500 new customers by year-end and another 1,500 customers next year. Energy is highly scalable to support Nordic’s ever-increasing customer numbers and grid volume.