‘War is ninety percent information’, once said Napoleon. This is also true in business, with increasingly vast volumes of data now becoming available.
For energy suppliers, improved access to consumption and behaviour data from smart meters, in-premises sensors and other sources, is already changing the competitive landscape. While a fully-connected future is not yet upon us, some businesses are evolving now to realise insights and drive immediate value.
Key areas where energy suppliers are already benefiting from improved analytics and insight include:
- Customer journeys – building a better understanding of how customers interact with their business and how critical experiences (and points of failure) impact the customer experience. At the leading edge this includes analytics to drive mass personalisation of marketing and product development approaches
- Operational optimisation – driving efficiencies and increasing productivity, with significant opportunities for cost transformation in particular in contact centres, debt collection and field force deployment.
With the increasing need to remain competitive and comply with regulations such as price caps, it can be difficult to judge where to invest your valuable analytical resources. In addition, knowing when to invest in building analytical capability can be a difficult balance between driving leading capability to build market position, the opportunity costs of delay, and the near-term impact on the bottom line.
To help navigate this complex area, we recommend three core principles that should sit at the heart of any data analytics strategy:
- Ask the right questions: easy to say, hard to achieve. Knowing which issue or lever is likely to drive maximum business performance, staying focused on these levers, and tailoring a specific analytics strategy around them is a key driver of success. Conversely, an ambiguous goal will lead to time spent finding solutions that do not address the problem and are of limited value. So before starting:
- Ask what are you trying to resolve?
- Ask why, why and why?
- Lastly, don’t be afraid to pushback and challenge
- Know your data: To understand how much value you can drive from your data it is critical to understand its quality, complexity and availability. Only then, can data be truly maximised and realistic expectations on return be made. Data availability and quality will determine the range of analytics available from descriptive, to prescriptive, to predictive. It will also determine the type of questions you can answer immediately versus what will require further investment
- Build momentum by acting on insight: Proof of concept is a powerful way to obtain initial buy-in from your stakeholders, but it is imperative to plan for success from the beginning by ensuring that the organisational support to scale will be there if the pilot is successful. Without this, many insights will remain at recommendation stage without driving real improvements. A key component of the scale up plan needs to be the right level of connectedness between the analytic capabilities and the wider business and IT structure, to ensure truly embedded data-driven decision-making.
As the future of data becomes increasingly voluminous and interconnected, applying these core principles will help embed a targeted, value driven approach to data led insight that can ultimately unlock business critical and transformational insight from scarce resources.