Going from utility company to powerhouse?

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1 tieto.com Austria, Belarus, Canada, China, Czech Republic, Denmark, Estonia, Finland, France, Germany, India, Indonesia, Italy, Latvia, Lithuania, Malaysia, Netherlands, Norway, Poland, Russia, Singapore, Spain, Sweden, Ukraine the United Kingdom, and the USA. Going from utility company to powerhouse? We ll help you grow faster. Tieto Aku Korhosen tie 2 6 P.O. Box 38 FI Helsinki, Finland Rev date: Knowledge. Passion. Results.

2 Empowering your business. In order for utility companies to keep up with the major changes in the energy market, heavy investments in business development, processes and IT are required. You can benefit from our experience and from the fact that we re a forerunner in the market. Take advantage of our knowledge to keep the pace and come out as winner. As an independent supplier of IT and related services, Tieto is actively pursuing the role of market actor; not in the sense of being an utility company, but as an IT supplier. Tieto has a full range of solutions and services to help you lead the next generation of the digital utility arena. To date, we have contributed to the roll-out of over Smart meters and every 3rd customers in the Nordic countries is billed via a Tieto application.

3 Implementing Smart Metering and Advanced Metering Infrastructure (AMI) is the cornerstone for a future electricity infrastructure the Smart Grid. Implementing AMI will change the value chain of the energy industry. Efficient process and work flow management contributes to a lean and efficient organization that uses energy and resources correctly. This helps reduce an energy company s cost and its environmental footprint. Fortum needed to consolidate its range of internal systems in a growing and evolving company and to make its external communications with subcontractors more efficient. To do this, the company required a new and modern system for process support and process improvements in work order administration for operative and maintenance services. One of the driving forces was the meter reform in Sweden that simplified customer billing and provided better feedback for reducing energy consumption. Fortum had to replace 900,000 meters in 18 months. Tieto s solution Since 2003, Fortum has been using Tieto WMS (Workflow Management System) a system now used by several energy companies in the Nordic countries. The roll-out of 900,000 smart meters in Sweden was a major test of strength for WMS, which was essential for managing such a large roll-out in such a short time, according to Fortum. At the same time, the IT support enabled more effective processes, which have saved time and money. WMS has contributed to tangible improvements both in terms of efficiency gains for Fortum s internal processes that improved customer service, and rationalizations that have contributed to savings. Fortum was able to retain ownership of the processes that secured order fulfilment and had the freedom to use internal or external personnel without losing overall control. Fortum defined every step in the meter change process, which allowed it to ensure that errors were found early in the processes instead of during billing. As Fortum was able to follow up each work order and its status, problems were automatically handled in the early stages. Without the joint IT support for both us and our subcontractors, provided by WMS, we would never have been able to handle administration of all work orders. Fortum, Electricity and Distribution Division Results in brief: Operating costs cut by 20 percent Effective processes Higher quality Flexibility Business control Scalability What characterizes a successful AMI rollout? All gain and no pain. Fortum successfully executed a major rollout of 900,000 smart meters in less than three and a half years using Tieto s Workflow Management System (WMS). WMS enabled Fortum to retain full ownership of the process, regardless of the contractor, sub-process, or technical solution.

4 The Nordic and European utility markets have undergone major changes over the last few years, with deregulations, requirements for more frequent meter reading, and increased customer engagement when prices have increased. Do you find it difficult to manage your AMI? We ll save you the energy. In 2003, the Swedish authorities passed a bill that required all utilities to establish automatic meter readings for all private households by July 1, Instead of establishing a large in-house organization, E.ON opted for a managed service approach. Tieto s solution In 2005, Tieto and E.ON Sweden signed a deal for AMI Managed Services for 143,000 end customers. The project was split into a roll-out project and a subsequent service delivery operation. The scope was a complete transformation; from manually read meters to the establishment of an automated meter reading infrastructure, delivery of a broader portfolio of smart metering services, and a close cooperation between two professional and capable service delivery organizations. Tieto managed the roll-out project and set up a full BPO (business process outsourcing) service operation. Tieto now runs the service operation from the AMI Service Centre in Lillehammer, Norway. The service center delivers meter reading services, outage information, field services and other smart metering services. E.ON had a smooth introduction and operation of smart metering services. The SLA (service level agreement) for monthly readings is consistently above 99.5 percent after 24 hours. There is a large customer benefit in good meter value handling. Because of this, it is very important for E.ON that this is fully functional. Results in brief: SLA above 99.5 percent Bengt-Tore Sondh, responsible for meter data acquisition in E.ON Elnät, Sweden. Smooth introduction and operation Lower cost through more efficient services Lower risk and less investment Outsourcing the management and operation of smart meters reduces risk and increases efficiency for the utility. These benefits applied to E.ON, which rolled out 145,000 successful smart meters in a project with Tieto as the prime contractor. Tieto handled the AMI roll-out and is now operating the AMI managed service to a sustained SLA above 99.5 percent. For E.ON, this means it can focus more on its core business while remaining in control of the whole process.

5 In a deregulated market, customers can freely choose their supplier. In order to be competitive, companies must provide tailored offerings in a cost-efficient and process-oriented manner. When customers are evasive, it is important to treat them as individuals. Fortum needed a new and modern customer management and billing system to improve its customer service and streamline billing routines, while still meeting performance demands for automatic reading of energy consumption. Internet ( My Account ), which is accessible around the clock. Customer service is becoming increasingly cost-effective. Through efficiency measures, costs for customer service have fallen by more than 25 percent. Do you offer the same level of customer service you would like to receive? Fortum does that, at a 25 percent lower cost. Tieto s solution Since 2006, Fortum in Sweden has been using Tieto CAB (Customer and Billing) a customer management and billing service that is used by more than 20 other Nordic energy companies. Integrated with business process, CAB is highly automated and scalable to build and manage customer relations, which enables Fortum to attract and retain customers on its terms. At Fortum, CAB has contributed to tangible and measurable improvements with increasing numbers of satisfied customers and efficiency gains. Customer service is constantly improving. More than 90 percent of the approximately one million telephone queries per year are now resolved during the first call. Customer service is becoming increasingly automated. More and more customers are choosing self-service by phone (automated response) or the The entire energy market is facing major challenges that require IT support, experiences from other branches such as banks and telecom branch, and Nordic collaboration. Results in brief: High performance Cost-efficiency Flexibility Business control Scalability Peter Strannegård, Head of Customer Services, IT and Process Development Fortum, Electricity and Distribution Division Fortum s costs for customer service have fallen by more than 25 percent and first-call resolution is up to a record high of 90 percent. In addition, more and more customers are choosing self-service by phone or Internet. Fortum chose Tieto Customer and Billing to meet its existing and new customer service demands.

6 Solutions for a sustainable energy industry Tieto Utility Solutions provide full support for network and power companies. Focusing on the business processes of sales and distribution with innovative solutions for CRM, billing and cash management can help you stay ahead of the competition. Offer positive energy With Tieto Customer and Billing (CAB) A functional customer management and billing system is a basic requirement for any business, but utility companies that grow through acquisitions may find themselves with a range of different systems. The result is often costly manual handling and lower customer care, which can result in dissatisfied customers and lost business. Tieto Customer and Billing system supports a high degree of automation and is specially designed for Nordic energy companies. It is currently used by over 20 energy companies in the Nordic region, serving over 3 million end users. In partnership with Tieto, the customer is influencing product development through strategic forums. The end result is a flexible and scalable customer and billing system that can be adapted to fit and improve your business. Never again will you need to constrain your business model to the limitations of a system. Get the best possible AMI roll-out With our Workflow Management System (WMS) There is no doubt that Advanced Metering Infrastructure will change the value chain of the entire energy industry. But the roll-out process is probably a new experience and possibly a daunting challenge for any utility company. The process is lined with a number of important decisions, such as the choice of vendor and planning the roll-out as effectively as possible while minimizing end-user interference. Tieto Workflow Management System will manage the roll-out and operation phase from a distribution perspective. So far, we have successfully deployed over smart meters in Europe with the proven ability to lower operational costs by up to 20 %. This means you can worry about other things, like customer satisfaction. Control your customer service With Tieto Unified Desktop Today, most customer service is still handelled through call center or branch offices. However, self-service channels are rapidly gaining ground and the number of back-end systems has increased. The requirements on customer service are also changing. No matter how, when, or where customers choose to contact the vendor company, they should be met with the best and most advanced customer service. Increase efficiency and decrease operational costs with Tieto Energy Contact Manager. One single access point to all customer data ensure that you can always deliver quick and accurate responses. It will enable you to offer consistent and high-quality customer service in a multichannel environment. This will increase the customer satisfaction and give you a competitive advantage. Offer better service for your customers With Tieto Online Today, consumers are challenging energy utility companies traditional customer services models. Fast, high-quality service, regardless of the service channel, is required and considered a vital but basic service. It is important for a utility company that the high service and corporate image is consistent throughout the various service channels. Tieto Energy Online is an effective platform, both for customer self-service and for additional sales. It will bring down costs and open the door for additional revenue streams. You will be able to offer a better service experience for your customers with an increased self-service level. At the same time, your operational efficiency will increase in combination with new business potential. Boost your network value With our Network Asset Management System (NAM) With the deregulation of the electricity market and evolution of Smart Grids, distribution network utilities are facing a new reality. Network life-cycle management needs to be more efficient, more analysis is required, allocation of investments need to be smarter, and authorities need more reports. Also, end customers expect an uninterrupted supply of electricity. There is clearly room for improvement. Our Network Asset Management system lets you control the condition of a network, the allocation of investments and the life cycle of the entire network. And when you have all these things under control, you can minimize costs and increase productivity by correctly allocating and scheduling the investments. Master your AMI With Tieto s tailored AMI Managed Service When Advanced Metering Infrastructure has entered your IT environment, you may ask yourself how all this will be managed in the best possible manner. You could either invest in more IT and educate your staff or opt for a more sustainable alternative and let us take care of managing your AMI. That way you can spend time on your core business. Take advantage of our complete AMI suite of components, which handles meter communication, high-speed data validation and storage, business process automation and field operations. We tailor the service according to your requirements of cost, availability and performance so you can stay on top of things. The end result is that you will enjoy a quick implementation without hassle or risky transition projects. Plan for the future With our Business Consulting services Deregulation, requirements on more frequent meter reading, increased prices and customer engagement... the Nordic and European utility markets have really undergone huge changes over the past decade and we are facing even more changes. For instance, outcome of hourly measured meters will be new opportunities and demands, supported by a common Nordic retail market and a supplier centric model. Take advantage of our deep industry knowledge and crossindustry expertise. We combine our skills in different competence areas with an unique understanding of utility industries. Benefit from our position as a market leader in other industries, such as telecom and banking, and make use of our experience in the development of customer behavior and IT solutions. Make use of our knowledge and passion to boost your results.

7 The competition in the energy sector is intense. In order to improve customer service and cost-effectiveness simultaneously, energy companies must develop new online self-service solutions. Vattenfall, which aims to become Europe s leading energy company, identified the need for better online service to reduce the need for manual intervention. Although Vattenfall had ways of contacting customer services through Internet channels, some elements of customer service still involved manual work, such as s from customers. Invoicing, meter reading, consumption reporting, and other functions are well suited for being handled over the Internet. As automatic meter reading (that is, remotely read meters) becomes more common, it will be possible to make reporting and monitoring more efficient. The amount of metering data will increase by a factor of one Would you consider doubling your service rate a win? It could be a win-win. Tieto s Solution In partnership with Tieto, online services were seamlessly integrated into Vattenfall s customer management system. The next stage in Vattenfall s plans is to standardize the technical solution and appearance of the Internet service. These areas should be identical in all of the countries in which Vattenfall is involved, in the entire value chain for electricity and heat, from production to distribution. The rate of active utilization of Vattenfall s online service has increased, and service improvement has led to high customer satisfaction. Vattenfall has increased, and its cost-effectiveness, while Internet services have developed as a sales channel. At the same time, the Internet will grow as a sales channel for Vattenfall, just as it is already a channel for communication and customer service. From Vattenfall s point of view, the benefits of online service will lead to cost-effectiveness, but also to satisfied customers. Vattenfall gives its customers the freedom to manage their energy transactions whenever and however they want. We give customers the freedom to manage their energy transactions whenever they want and however they want. The requirements of customers are more important than cost-effectiveness; ideally, we can combine the interests of customers and those of the company. Results in brief: Satisfied customers Better customer service Operational efficiency New sales channel Ilkka Salonen, Managing Director at Vattenfall Sähkönmyynti Oy The active utilization of Vattenfall s online self-service has doubled each year, and the reason is clear: when it comes to deciding what customers want, there is no better authority than the customers themselves. The result is increased cost effectiveness and higher customer satisfaction and increased sales will soon follow. Internet-based self services are adding the role of a sales channel and the future integration of automated meter reading will further increase satisfaction.

8 In a deregulated market, electricity production and sales are open to competition, while the distribution of electricity is strictly regulated and monitored by national authorities. This places two-fold demand on a company such as Fortum. On one hand, IT support should help ensure electricity distribution to consumers and make work processes more efficient to save time and money, which strengthens the company s competitiveness. On the other hand, IT support should provide national authorities with continually updated status reports on the distribution network, thereby contributing to open and neutral monitoring of the electricity market. With a total distribution network of 140,000 km, with 500 large and 50,000 small distribution stations, Fortum distributes secure electricity with percent reliability to 1.5 million customers in Sweden and Finland. Deregulation has meant that Fortum and other companies are facing a new situation they are required to provide more efficient network life cycle management, analysis, and allocation of investments, as well as the requirement to submit various types of reports with public authorities. Tieto s solution Tieto NAM (Network Asset Management) was specifically developed for the new deregulated market. It includes tools for all the essential tasks of a network company, ranging from planning documentation to contact management, network calculation, and reporting all in a single system. NAM is a modular system with open architecture that is based on SmallWorld GIS, a robust and global platform from General Electric that Tieto complements with add-in modules adapted to European conditions. Tieto NAM gives Fortum control over its most important asset the distribution network. Fortum has used NAM since 2006 in both Finland and Sweden. Replacing several systems with one common system has caused IT costs to decline. NAM is a robust system that manages many users with retained performance Fortum has nearly 250 users every day in Finland and Sweden. The system can also receive and handle very large volumes of information with high quality. We ve gained the IT support we wanted an open and cost-effective system that is good both for the companies and the authorities that monitor us. Results in brief: Mikael Mickelsson, process development and operative IT support at Fortum Making the most of investments and resources Official reports with a single click Assistance in planning for the future Guidance in decision-making Is managing your distribution network hard work? Fortum makes it easy through teamwork. Fortum user groups make smarter use of their resources through improved business processes, and IT costs have declined. Network Asset Management from Tieto maintains control over operations, maintenance, and installations, setting a new standard for distribution network management and control.

9 Tieto in numbers: #1 For outsourcing in the Nordic region. In Customer Information Systems in the Nordic countries. 26 Operating countries. 33% Every 3rd customer in the Nordic countries is billed via a Tieto application IT experts We have contributed to the roll-out of more than 1 million Smart Meters Utility EDI transaction messages delivered per year.

10 The leading provider of customer information and billing solutions Tieto is the leading IT service company in Northern Europe providing IT and product engineering services. Our highly specialized IT solutions and services, complemented by a strong technology platform, create tangible business benefits for our local and global customers. As a trusted transformation partner, we are close to our customers and understand their unique needs. With about experts, we aim to become a leading service integrator creating the best service experience in IT. We are the leading provider of customer information and billing solutions to energy utility companies in the Nordic countries. Paving the way for the Smart Grid and AMI, we have facilitated projects implementing more than smart meters. We are also a leading supplier of large-scale automatic metering services in Scandinavia. Tieto has a unique position for the smart metering implementation. Every 3rd customer in the Nordics is billed via a Tieto application.

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