CFO World

How Momentum Energy has transformed its entire business to be customer-led

Managing director and GM of marketing and sales for the Tasmanian-owned energy provider share the massive technology-led transformation program that's paying big customer dividends

An ambition to bring simplicity and transparency to the way customers engage with their energy supplier has triggered a technology-led transformation at Momentum Energy that’s shaking up its cultural and organisational foundations. 

The 14-year old utilities supplier is owned by Hydro Tasmania, which in turn is owned by the Tasmanian Government. Momentum Energy retails electricity and gas outside the island state, however, with primary markets including Victoria, New South Wales, South Australia, Queensland, the ACT, and the Bass Strait Islands and a customer base stretching from consumer and residential to SME and large commercial and industrial organisations.

Managing director of the tier-two challenger, Paul Geason, said its differentiator is pricing and offering services in a simplistic and transparent way. Which is why, in 2015, the group kicked off an extensive transformation program aimed at making customer service and experience its competitive advantage.

Historically, Momentum Energy operated a light touch model with systems and processes. “We essentially didn’t have a CRM, had a basic billing system, and some telco routing on top of that,” Geason explained.

“We saw the opportunity to accelerate and potentially leapfrog the competition in terms of the way technology was deployed. But we needed a CRM, omni-channel approach and the ability to get a single view of our customers.

“The imperative for us always is the customer experience and this ambition we have to become the best provider of customer service. Energy is it’s an essential service. Customers can’t exit the energy market; you need energy to fuel your lifestyle and your business. But it’s a commodity to the extent that the electrons coming out of your port are the same no matter where you get them.

“For us, the only long lasting sustainable differentiation will come from the experience we can provide our customers.”

Geason described the opportunity in two ways. The first was using automation to grow Momentum Energy’s customer base and the value of the business from a customer revenue generation perspective.

“We also saw extraordinary opportunity for optimisation of processes and improvement in operational efficiencies. Those things weigh up about the same in terms of the business case and ROI we were after,” he said.  

Starting on the CX journey

Momentum Energy’s transformation kicked off in early 2015 with an information seeking exercise aimed at understanding what technology could help improve customer interactions and improve internal efficiency. This led to a formal procurement process and the appointment of Accenture as consultancy and integration lead in September 2015. A blueprinting phase was then followed by business case development.  

During this time and all the way through the program, board and shareholder support was vital, Geason said. But this didn’t stop the driest Tasmanian Spring and Summer on record, followed by a break in Basslink, delaying the transformation project. Things were back on track at the end of 2016, and the technology rollout commenced in first six months of 2017, going live in July.

Momentum Energy embarked on a substantial technology transformation, rolling out a suite of Salesforce solutions including Service Cloud, Marketing Cloud, Sales Cloud and Community Cloud. It has built an integration layer with Mulesoft, and linked platforms to a billing engine from Orion Software, its credit collections tool, credAgility, and CloudSense’s configure, price and quote solution. Momentum Energy also adopted Smartcomm for document management.

While the focus needed to be on technology, it’s critical to keep an eye on business as usual, Geason said.

“If you are distracted and not delivering on existing commitments during the transformation journey, other things happen that aren’t meant to happen and can potentially prevent you from being successful,” he said. “At some points, we had 50 per cent of our people working in and around the project. It was incredibly fatiguing and somewhat overwhelming at times, but in the end it was very rewarding.

“Because so many people were involved, we started getting a very strong pull effect for change. People had insight into how the new world would look and were excited about it.”

That led to the third dimension of any transformation program: Culture.

“Having the mindset of the organisation in the right place at the time you go live is absolutely fundamental,” Geason said. “We were not perfect in this regard, but we did a lot of work on what this new world would look like in terms of capability. It’s not about the technology – the technology enables us to do new and different things – we needed the right mindset.”

That mindset comes back to the brand’s ambition to make things better for its customers.

“In parallel, we’ve been through a journey to ensure we hit the ground running with a focus on learning much more about our customers,” Geason continued. Data, analytics and unlocking the value of the platform through that insight were key ingredients in this mix.

“We’re working on a culture where our people are very engaged in understanding the insights about our customers, our competitive landscape and external environment,” he continued. “But it’s very important our organisation is empowered around the platform, too.

“Through customer-led design approaches, we’re really changing the way we operate as a business, and it’s all designed around only doing things that make things better for our customers.”

Switching on new skillsets

Part and parcel of this is building new skills and ways of working.

“We talk about making energy human… and the first two key attributes of that are simplicity and transparency. That’s for both our staff and our customers,” Geason said. “We’re getting this nice match between the concepts of culture and how people think, and now what they can actually do.”  

One major element that brought cohesion and clear accountability to the program was executive-level sponsorship. Geason himself took the business champion mantle, supported by a broad-based steering committee and governance structure.

“I have a very tight relationship with our CIO, and we ran the program management and delivery in combination with business and technical resources,” he explained. “It wasn’t about pushing a technology solution; the business dragged it and got more and more excited about it.”

Momentum Energy GM of sales and marketing, Amy Childs, agreed the cross-functional approach was vital. “When ‘Switzerland’ – that is, your MD – supports it, it just makes the whole thing so streamlined,” she said. “You’re very aligned when the boss is in charge of something. And no one division drives its own agenda.”  

Low hanging fruit

Already change is bearing fruit in marketing and sales. A first step was replacing a manual process to enter customer data with an end-to-end, automated approach.

“Say you’re moving home, and an exception comes up on our system because we haven’t got your drivers’ licence down correctly,” Childs said. “If you’re moving the next day, we’d be calling you to update that information because we can’t do the credit check. As a result, you’d miss that deadline for the move and wind up without energy services. It was horrendous in terms of customer experience, for the sales staff, and led to frustration on all sides.”

Today, the entire process takes just 11 minutes, end-to-end. “The minute you hit submit on the sales, regardless of which channel you sign up on, you are in the process, provisioned, running and set up in the billing engine,” Childs said.

“That is a huge step forward in experience. It also sends you a welcome email, and once you click on that, you can see your own account, set up in our customer account portal, and you’re away. That is a great example of how we’ve been able to transform things.”

The digital experience has also been rejigged. A basic portal system that only allowed a customer to pay and look at their account has been replaced with self-service capability including information around usage, an ability to move or add properties, update personal details and set up payment methods.

Childs said online single sign-up for portal access has grown threefold in three months. “People are self-servicing and it’s taking demand off our call centre,” she said.  

In addition, Momentum Energy has introduced a cost estimator tool, allowing prospects to upload a bill from major competitors and compare costings in real-time.

“We can apply that into Marketing Cloud, prospect out to market on it or advertise it through social,” Childs said. “Customers are getting that cost estimate and it makes us transparent. If you’re not better off with us, we don’t remarket you. But if you are better off, you can click straight into the funnel. We scrape all that bill data for you, present it in an online sign-up tool, and you click to join.

“That brings elegance to the digital experience but also real measurement. Historically, I haven’t been able to talk about how much media money is going into which channel and what channel people are converting in. We’re now getting transparency we haven’t had before and we can monitor individuals from prospect through to customer.

“Energy should be able to be bought online. It’s a basic, simple service. That’s what we’re striving to do. We don’t want to hide behind regulation or complexity, which I think the industry has typically tried to do.”

Just one month after going live, Momentum Energy reported its biggest sales month in its history.

“We were able to process all of that selling in an efficient and effective way,” Geason said. “We have reduced average handling times, wait times, sales talk time and sales service online and we’re seeing more online sales. All of those things are important to us both in terms of generating revenue and margin outcomes as much as delivering productivity.”

Childs said data visibility is opening up top-line customer segments, helping teams understand the types of people attracted to the business and where they’re coming from.

“We are doing lots of work around customer segments and designing new products we can market that will appear to people who are actually like our customers who’ve been with us for a long time,” she said.  

“The other thing is how we start to think about rewarding loyalty and tenure in a way that’s meaningful.”  

Up next: How Momentum tackled skills and training, plus lessons in building capability

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Skills and training

It’s a big skills shift, too. In advance, Childs recruited professionals with Salesforce experience, and existing staff were given training.  But the most important decision was to put staff knee deep into the transformation program itself, she said.

“We made big sacrifices in our day jobs for six months,” she said. “But it paid dividends because once we went live, people knew what to do. You can’t go and learn this in a classroom in a week.”  

Momentum Energy also introduced an initiative recognising Salesforce experts, ensuring these people were spread across divisions. These individuals wear caps, run workshops and help staff around any issues.

But Geason agreed there is a higher level issue all organisations going through significant transformation program must confront around structure. A big skills gap is arguably around data and insight.

“We don’t have all the right skills and capability either technical or leadership level of getting the Ferrari out of first gear and that’s very confronting,” he said. “If we were to test the forward compatibility of our leadership in being truly capable of optimising and leveraging this technology, it’d be challenged. It’s not because we need them to be deep technologists, but because they’re now the critical link between the potential and reconciling it with what customers actually want. We are challenging historically norms.”

For Geason, the only limitation on Momentum Energy realising its ambitions is an inability to be creative and innovative when using the new platforms.

“The thing that stifles that is fear and people not feeling comfortable about challenging the way we do things,” he said. “You always have to believe there is a better way of doing something and constantly challenging yourself. 

“Hopefully, people are seeing a deep and extensive focus on sharing and facilitating knowledge in and across the business around customer insight. We’re also ferocious in our curiosity and insight around what our competitors are up to. For us, it’s about understanding the external environment and combining that in a customer-led design manner so we can have a series of initiatives, actions and investments that are all aligned and that make things better for our customers.”

- Nadia Cameron travelled to Dreamforce in San Francisco as a guest of Salesforce.

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