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Market Focus: Energy/Utilities -- Speaking Truth to Power (Companies)
Analytics are increasingly leveraged for insight into customer behavior.
For the rest of the December 2007 issue of CRM magazine please click here
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CRM takes on special meaning for utility and energy companies, which often operate under tightly regulated monopolies and cater to clients who have very limited options in terms of providers. Still, utility companies have long made CRM part of their business strategies, and technology has recently advanced to the point where they can power up customer relations through analytics and tighter integration between infrastructure systems and customer data. "CRM has become critical because it's the underlying premise of the new delivery model that utility companies are taking," says Bob Zabors, a founding partner at consultancy Bridge Strategy Group. "Vendors are recognizing this more-integrated approach and have optimized their product based on the core processes of utility companies. It's allowing utility companies to address best practices versus the technology." Many utility companies are looking at back-end database integration solutions that link collected data with customer information and work requests. "If you look at the number of devices and the amount of data these companies are taking in -- both from a technical and customer side of things, such as electric meters, transformers, and customer data from a CRM system -- this is a huge asset that utility companies haven't done a good job leveraging to get the big picture," Zabors says. Utilities are increasingly leveraging analytics to dig deeper into customer behavior and to segment residents based on their consumption of resources and their propensity to switch providers. The analytics push is a result of the highly regulated environment that utility companies typically operate in. "It's not like utility companies can go out and change their products," Zabors says. "Many of these companies have come to realize that customer service is the only way to differentiate themselves." Leading power and utility companies are segmenting customers for collections, service calls, and infrastructure monitoring to predict potential power failures. Green Mountain Power, for example, an investor-owned energy services company that supplies electricity to 87,000 customers in Vermont, was looking to cut IT costs while improving its ability to detect trouble spots and speeding the dispatch of work crews, says Todd Julius, chief technology and customer solution manager. To integrate Green Mountain's systems, Julius selected Oracle Real Application Cluster (RAC).
Using RAC, Green Mountain consolidated the databases and servers it uses for its infrastructure and for its customer information. Green Mountain has reduced staff by nearly 50 percent, resulting in an annual savings of $100,000, while still improving customer service. In addition, the utility company avoided more than $2 million in software costs by consolidating its systems. "With Oracle databases hooked up with our phone system and powered by HP, we are able to automatically mark where outages are and have them show up on road maps," Julius says. "By using GPS locators, truck locations appear on our maps, so one person can manage the outage effectively until the rest of the crews come in. Instead of spending millions of dollars on software, we spend less and make better use of our existing software." The implementation of Oracle RAC also set the stage for later improvements involving further integration of the company's databases. Green Mountain plans to add automated meter-reading to its IT portfolio, allowing meters to be read remotely every 15 minutes. The utility is also developing mobile capabilities via laptops installed in service trucks, allowing workers to schedule work, enter completed jobs, and have access to remote locator technology that will allow them to track power outages. "I can't think of anything with more ability to radically change utility practices than this," Julius says. "The benefits will cascade through the organization to reduce operating costs and positively impact customer service, load management, system reliability, and storm resolution." Top 3 Vendors in Energy/Utilities: Source: Gartner
  • SAP
  • Siebel Systems
  • Oracle
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