14 Oct Technology and the Future of the Retail Energy Industry
By: Monica Bellino
I am sure we can all agree that innovation often goes hand in hand with technology. Keeping this in mind when we consider the current state of our industry, it should be fairly evident that we could all be utilizing technology in more efficient and innovative ways. For many retailers the ability to be proactive, instead of reactive can mean the difference between success or failure. We as an industry need to challenge the current status quo of how we operate, the technology we use and the way we interact with our customers.
To put all of this into a more tangible and practical perspective, let’s look at a real-life example. 15 years ago, a small commercial and industrial retailer started their business using almost exclusively excel and employees running the organization with all manual processes. As they grew the business, their inventory of disconnected and un-auditable spreadsheets grew, as did their headcount. It takes a decent amount of manpower to run a business on nothing but spreadsheets and be able to issue accurate invoices, correct nominations, or process LDC transactions in a timely manner. Once they hit about 125 meters and 8 FTEs, they knew they had to change the way they managed their business if they wanted to continue to grow and scale their book in a profitable manner.
This is a crossroads that most retailers hit once they have moved past the initial startup phase. They have great ideas and strategies laid out, but when it comes to putting these strategies into action, the limitations of their operations and IT infrastructure rears its ugly head. I am sure we have all seen this a few times over in the industry – companies hitting the wall between knowing what they want to achieve, but recognizing their limitations in actually getting the job done. This company had hit that inevitable point and they chose to evolve and improve the way they did business.
The operations group particularly, was an advocate of the concept that growth and cost reduction could only come with a change in operational practices and the tools being used. So, they sought a software solution that would fit their needs: the ability to maintain their business from wholesale all the way to the burner tip. After quite a search they found a solution that fit their needs, it had been built fit for purpose and required very little custom development as almost everything was configurable. It also provided them the flexibility and data accuracy they needed, as the solution was built on one code base with one central data repository.
The outcome post implementation was significant. This end-to-end solution enabled them consistency in their processes and for their labor force, eliminating fire drills and improving overall productivity. 15 years later they are still using the same system and it has been a large part of their success. Today they have over 1100 large commercial & industrial meters, are in over 20 states and over 60 utilities and while their book size is a success story of its own, their current headcount is what really stands out. 15 years ago, while operating on spreadsheets, they needed 8-10 FTEs to run their book of about 125 meters, after implementing the software solution they currently only need roughly 15 FTEs to manage a book of over 1100 meters.
This company’s use of technology enabled them to thrive and succeed, where many others have failed. They chose to move out of their comfort zone and utilize a unique solution to create competitive advantage. With the right innovation, our industry has a bright future, but we have to challenge ourselves to take a fresh look at how technology plays a role in that future. Will the technologies we have always used will be able to successfully carry us into that bright future?
Monica Bellino is the Head of Customer Success at nGenue