Customer Service Information Technology

Customer Service Information Technology 2015 Benchmarking Insights Conference Park City, UT This material has been optimized for the Insights Conference audience. To get the most of this material and hear a recording of this presentation go to our http://1stquartileconsulting.com/benchmarking/customer_service_b/csdocs.html and find the table for CS Insights, then click on the Information Technology link. 1

Agenda Overview Coverage of the Study for CS IT 2015 Key Findings/ Points of Emphasis Performance Profiles Cost 2015 Benchmarking Results Functional-specific findings Technology Applications Multi-Channel Adoption CIS Integration: Credit, Outage, Field Service Areas of Focus and Opportunity 2

Overview 3

Coverage of the 2015 Customer Service Benchmark Study Customer Contact Contact Center Local Office Self Service Contractors Credit Inbound calls Field Service Change of Account Billing Field Orders (meter investigations) Credit Field Orders Order Management Meter Reading Manual Mobile AMR Fixed Network AMI Back Office Billing Billing Field Policies Payment Processing Revenue Management Credit Office and Outbound calls Credit Field and Inbound Contact Policies Revenue Protection: Office and Field CS Support and CS IT, Training Employees: Safety, Staffing Customer: Customer Satisfaction, First Contact Resolution and Customer Experience, Key Accounts Areas excluded: Energy Audit/Energy Efficiency Group Meter Change- out 4

Functional Cost Model CS IT and CIS costs Our approach to collecting cost, performance and staffing information follows customer transactions through each functional area. CS IT C I S 5

CIS vs. CS IT Costs CS IT (as part of Technology cost) is all the encompassing technology in a broad sense so it includes any non-cis and may include some CIS, but is specific to a functional area for example: ACD, IVR, Work Management, Mobile Data are part of CS IT and belong in their respective functional area (ACD to Contact Center etc.) If there is a DIRECT allocation or charge to a function of CIS charges (such as usage or system utilization), then that goes into the CS IT, otherwise it is part of CIS CIS is the system used to to maintain customer information, generate bills, issue service requests, and help manage customer relationships by providing utility representatives data, information and insight about each customer's accounts, individual needs and preferences. Examples of vendor's products include: Accenture's C/1 (Customer-1), Oracle Utilities Customer Care, SAP For Utilities. CIS costs may be costs allocated to or associated with Customer Service but not to specific functions, such as usage charges, data transfer charges, and/or system maintenance charges. If such charges cannot be allocated to a specific function, they would go into the CIS cost column. Everything else such as the Work Management, Mobile Data, Dispatch, ACD, IVR is Customer Service IT and should be specific to a function 6

Technology Cost Within Function Technology Any technology specifically used for a function such as meter reading devices, mobile data technology, telephone switch or call routing software, call monitoring software etc. Contact Center: IVR (Interactive Voice Response) ACD (Automatic Call Distributor) Scheduling Software Workforce Management (WFM) Multi-channel processing Web, Social Media technology costs VOIP (Voice Over Internet Protocol) Web/email routers Virtual Hold technology costs 3rd party applications (OMS interface etc.) Field: Mobile data (software and hardware) Scheduling GPS (Global Positioning System) Telecommunications Routing software Dispatching software Revenue Protection Tamper plug Data mining software Meter: Handhelds Routing software Telecommunications Remote disconnect MV 90 GPS (Global Positioning System) Bills: Inserters Web/email, bill presentment C/I billing software Payment: Image processer Slitter/sorter Interface w/kiosks Routing software for off-site payments Payment Kiosks Credit: Behavioral scoring Predictive dialer Credit optimization software 7

Performance Profile Cost 8

TOTAL CUSTOMER SERVICE COST (EXCLUDING WRITE- OFFS, P&B, OVERHEADS) PER ACCOUNT * CIS Costs represent $2.43 of the $34.60 Mean Cost, or 7% CIS Costs have been in the range of 5-8% CS costs (ex Write-offs) over the past 3 years FL Page 4 FL5 Mean $34.60 Quartile 1 $31.63 Quartile 2: $33.54 Quartile 3: $40.20 Not reporting CIS costs: 29, 35, and 36 9

CIS COST PER ACCOUNT * COMMODITY Mean of $2.43 per Account * Commodity represents a decline of 7% over 2014 s mean Mean $2.43 Quartile 1 $1.47 Quartile 2: $2.13 Quartile 3: $3.00 2014 Mean was $2.64 Several companies report few/no CIS costs Companies within the same holding company structure should be able to discuss and explain variability in costs IT Page 3 FL5 Not reporting CIS costs: 29, 35, and 36 10

Benchmarking Results Functional-specific findings Technology Applications Multi-Channel Adoption CIS Integration: Credit, Outage, Field Service 11

Technology Application Profile: Changes and Recent Upgrades CIS Systems Installed (IT5) upgrades are continuing Companies in our Community have moved away from mainframe-based systems of the 90 s and early 2000 s toward much more flexible systems, allowing for more data capture and use Mean age of install or upgrade= 2006 Newer systems are generally split between SAP and Oracle; Recent implementations or upgrades are Companies 27, 35, 26 and 31 Contact Handling and Management (IT5) most companies now have IVRs that have been implemented in the past 2-3 years. Other contact handling and management systems (ACD, WFM, QM), are also new 2/3 of our companies have installed new IVRs or major upgrades since 2012; 8 of 13 companies reporting have installed new Automated Call Distribution (ACD) since 2012 6 of 10 companies reporting have installed new Work Force Management (WFM) and Quality Monitoring/ Management systems since 2012 5 companies have new Meter Data Management systems since 2013 Multi-channel technology applications (IT10) 6 companies have implemented new text messaging/sms systems since 2013 Numerous changes in mobile, web, and multi-channel management are also coming for at least 7 companies in the next 2 years (see next slides) Report: CS IT Pages 8 through 20 IT5, IT10 12

CUSTOMER INFORMATION SYSTEM: YEAR INSTALLED Or Major Upgrade Oracle SAP Accenture C-1 In-House Cayenta (Harris) IT Page 5 and 6 IT 5 The average year of install/upgrade of the CIS in our Community is 2006 Migration and transition time periods are 2-3 years how are companies leveraging? Impact of systems on companies ability to mine and capture data, have flexible reporting and integrate with new applications should be noted 13

Interactive Voice Response (IVR): YEAR INSTALLED Or Major Upgrade Centurion Siemens Avaya TFCC Nuance In-House West IT Page 9 and 10 IT 5 The average year of install/upgrade of the IVR in our Community is 2011 50% of the companies have installed new IVRs since in the last 2 years What cost and live call reduction benefits have been derived? What are we understanding about our self-service calls? 14

MAJOR UPGRADE OR REPLACEMENT IN NEXT 2 YEARS For those remaining companies that have not upgraded, CIS and IVR changes along with mobile web applications are occurring in the next 2 year window. How to best leverage the technology change? Total Respondents 12 Primary CIS 25% IVR Interactive Voice Response 50% Mobile Application 41.67% Mobile Website 58.33% Legends 22 24 25 26 27 28 31 33 34 35 36 38 Primary CIS ACD Automatic Call Distributor IVR Interactive Voice Response CMS Call Management System Scheduling WFM Software Quality Monitoring and Reporting Software MultiChannel management software Training E~learning software Mobile Application Mobile Website SMS Messaging Other BL Page 50 BL115 15

INTEGRATIVE TECHNOLOGIES RECENTLY EMPLOYED TO REDUCE HANDLE TIMES AND OVERALL TIME SPENT PROCESSING LIVE CONTACTS This year, companies are reporting a greater focus on aids to help agents and improved messaging to get customers to the right channel Legends 21 22 23 24 25 26 27 28 31 33 34 35 36 37 38 None Improved screen pops with customer information prepopulated Provide information on paths customers have taken to get to the agent IVR Enhanced data mining to allow most appropriate agent to handle call based on skill customer history Improved messaging to move customers to most appropriate channel self service Enhanced agents ability to see status of service orders or other pending customer work Enhanced intranet capability to allow agents to see quick tips or content specific areas Other IT Page 38 IT45 16

INITIATIVES UNDERTAKEN TO BETTER MANAGE THE HANDLING OF CUSTOMER INFORMATION NEEDED TO ENABLE MULTICHANNEL ADOPTION Companies are focusing on communication, verification and informational aspects in their initiatives Email receipts for transactions provide customers with validation of transaction completion in echannels. Customer contacts and transaction receipts with epay and ebill enhancements to both the desktop and mobile sites. (34) Customers can add additional phone numbers in IVR so we can better ANI match and know who the customer is. Allow customers to store their banking and credit card information on the website so customers can easily pay their bill online (22) Phone and email validation (27) Customers have the option of updating their 'profile' information. Also, on all contacts with a customer, CSRs are required to verify all customer information to ensure its accuracy and customer account phone numbers on every contact. (36) Implemented SMS messaging for outages and a new mobile application.(25) Added or enhanced notifications across Billing, Programs, Account, Service and Payments. Added additional mediums including SMS and Push (38) Implemented proactive outage notifications in 1Q, 2015. Consistency across self-serve and serve channels. Executed auto opt-in for all customers two payment notifications in Feb, 2015 Rollout of Communications Training to Call Center to increase use of Contact/Preference Screens. (38) Mobile compatibility for payments, meter reading and bill payment (37, 21) IT Page 36 IT35 17

RESULTS OF MULTI-CHANNEL [E-MAIL, IVR, WEB] IMPROVEMENTS Companies are reporting more customer options, better communications, and reduction in call volume (8 of 12 reporting) Can measurement can ensure these types of results? How many are effectively measuring the outcomes? IT Page 35 IT30 18

OUTAGE SERVICE APPLICATIONS/SERVICES RECENTLY ADOPTED TO BETTER INTEGRATE AND RESPOND TO CUSTOMER OUTAGE/INTERUPTION As was the case last year, companies are reporting added adoption of enhanced outage reporting (web and mobile), and better integration of OMS/GIS data for customer reporting Total Respondents 14 Mobile Outage Reporting 78.57% Enhanced integration with OMS SCADA or GIS applications for outage 64.29% management field and or customer reporting Outage update 57.14% Enhanced outage map reporting or updated on the web 71.43% Legends 21 22 23 24 25 26 27 28 31 33 34 35 37 38 None we have made no change to our outage response applications or service in the past 2 years Mutual Assistance Routing HVCA High Volume Call Answering Mobile Outage Reporting Enhanced integration with OMS SCADA or GIS applications for outage management field and or customer reporting Outage update Enhanced outage map reporting or updated on the web Other IT Page 39 IT50 19

Channels for Outage Tracking and Reporting 100% of companies now have web reporting, 71% have mobile apps (an increase from less than 50% last year). In addition, at least 5 are utilizing text/sms messaging for notification (either to or from customers) Total Respondents 14 Website 100% Mobile App 71.43% Other 42.86% Legends 21 23 24 25 26 27 28 31 33 34 35 36 37 38 Website Mobile App Other ID Response 34 Text messaging, Social Media (Facebook) 27 TXT, MAIL, IVR notifications from OMS - For enrolled Customers 28 Planning underway and is anticipated to include website and map updates and restoration information 23 Report an outage by text via the customer's smartphone and receive status updates including estimated time of restoration. 25 SMS Messaging 38 Status updates are available via the IVR 31 IVR System 20

Example from Self Service: What is being Texted to/from Customers? Largest year-on-year increases in text functionality have come in bill pay/make payment and outage reporting by customers Total Respondents 9 Bill notification 33.33% Bill pay make payment 66.67% Customer move inout 22.22% Outage information (receive including updates) 44.44% Outage information (customer reported) 44.44% Smart Meter information 11.11% Other 33.33% Legends 21 25 26 27 31 34 36 37 38 Bill notification Bill pay make payment Customer move inout Outage information (receive including updates) Outage information (customer reports) Smart Meter information Other 21

FIELD SERVICE OR METERING APPLICATIONS/SERVICES RECENTLY ADOPTED TO BETTER INTEGRATE AND RESPOND TO CUSTOMER Needs The integration of AMI data availability to support customers is the main area of reported enhancement this year 6 companies are reporting some capability Total Respondents 13 None we have made no change to our field service 38.46% Realtime appointment scheduling for services 15.38% Automated appointment confirmation for scheduled 7.69% AMR or AMI data availability on a realtime basis 38.46% AMR or AMI data availability on a realtime basis for customers 38.46% Realtime service order status on day of service 0% Other 7.69% Legends 21 22 24 25 26 27 31 33 34 35 36 37 38 None we have made no change to our field service Realtime appointment scheduling for services Automated appointment confirmation for scheduled AMR or AMI data availability on a realtime basis AMR or AMI data availability on a realtime basis for customers Realtime service order status on day of service Other IT Page 41 IT55 22

CREDIT AND COLLECTIONS APPLICATIONS/SERVICES RECENTLY ADOPTED TO BETTER MANAGE CUSTOMER CREDIT One or the largest reported changes has been the increase in company s using remote disconnect for non-pay (from 2 to 5 companies year-onyear) Total Respondents 12 Use of remote disconnect capability for nonpay disconnects 41.67% Enhanced realtime updates of credit related activity in the CIS 33.33% Creation or enhancement of self service portals specifically for credit 25% Legends 21 22 24 25 26 27 28 31 33 36 37 38 Integration of smart meter data 25% Use of remote disconnect capability for Improved integration and use of data from 3rd parties 41.67% nonpay disconnects Better None we integrated have made or improved no change rulemaking to our to calculate internal credit 25% scores credit applications Enhanced realtime updates of credit related activity in the CIS Creation or enhancement of self service portals specifically for credit Integration of smart meter data Improved integration and use of data from 3rd parties Applied data mining or new CIS capabilities Better integrated or improved rulemaking to calculate internal credit scores Integrated new credit contact technology Other IT Page 43 IT60 23

areas of Focus and opportunity 24

areas of Focus and Opportunity Volume Is the upgrade/ replacement of your CIS allowing you to support customer contacts more effectively and efficiently Is the development and use of self service (Web, IVR, Mobile etc.) helping your company reduce the volume of live transactions/ work? Are you able to measure the volume changes, where and why they are happening? Are you able to measure customer satisfaction (and importantly dissatisfaction and fixes) with new applications? Cost CIS spending (FL5) can you quantify it and what are getting for your spend in this area? Service Are your customers getting the level of service in your IVR and Web without having to call twice/ transfer/ use alternate live contacts? Are you measuring to understand if you are attaining the benefits promised in business cases/ justification for CIS/ IT investment? 25

Thank you for your Input and Participation! Your Presenters Ken Buckstaff Ken.Buckstaff@1QConsulting.com 310-922-0783 Gene Dimitrov Gene.Dimitrov@1QConsulting.com 301-535-0590 Rob Earle Rob.Earle@1QConsulting.com 315-944-7610 Debi Cook Debi.Cook@1QConsulting.com 760-272-7277 About 1QC First Quartile Consulting is a utility-focused consultancy providing a full range of consulting services including continuous process improvement, change management, benchmarking and more. You can count on a proven process that assesses and optimizes your resources, processes, leadership management and technology to align your business needs with your customer s needs. Visit us at www.1stquartileconsulting.com Follow our updates on LinkedIn Corporate Office 400 Continental Blvd. Suite 600 El Segundo, CA 90245 (310) 426-2790 Satellite Offices Maryland Montana New York Texas Wisconsin 26

1QC Community Key Success Factors Information Technology and CIS Effectively communicate plans and changes internally Leverage regulatory support in making changes service and customer friendly; incorporate a regulatory strategy as part of implementations (AMI or CIS) Maintain process consistency and improvement as a driver of change and preparation for systems implementations Link initiatives to better provide service, data management and information flow to and from customers don t confuse your customers Develop internal expertise to parallel and augment the use of external vendors in implementations Manage expectations and targets to allow for assimilation of technology (people - learning, project burnout, work load; process- application and testing, quality) 27

xxxxsample The bill is the evidence that you took care of the issue. Calls, orders and more exceptions are the result if not completed. Total Respondents 15 First in 53.33% Last in 0% Priority based upon amount 6.67% Priority based upon customer type 0% Based upon billing cycle 66.67% Other 26.67% Legends 21 22 23 24 25 26 27 30 31 32 33 34 36 37 38 First in Last in Priority based upon amount Priority based upon customer type Based upon billing cycle Other BL Page 50 BL115 28