How BPOs can support as energy industry awaits Ofgem consumer consultation outcomes – by Rob Sawle

Overview

On 1 June this year, Ofgem concluded its four-week consultation which set out proposals to further improve consumer standards in the retail energy industry.

With confirmed decisions expected in the coming months, if not weeks, the consultation included proposals which would make it easier for vulnerable customers to contact their supplier, and studying the potential for suppliers to offer more tailored support for those who are struggling to pay their bills.

Another pillar the 66-page consultation focused on was the first-time introduction of an overarching consumer standards framework, which essentially would set out a roadmap for driving up industry standards and how those can be tracked and evaluated.

Ofgem’s public proposals are backed in the document by a number of statistics, including one which highlights a 13% rise in the number of people who said they find it more difficult to contact their supplier (based on figures between 2018 and 2022), and another which shows that over half of domestic consumers are dissatisfied with how their complaint has been handled.

The proposals and what they mean for the UK’s energy sector

So, what are the key initiatives and changes being proposed from the regulator? I can pick out four areas from the document:

• The launch of a free phone number for consumers to call, which would be free of charge from both landlines and mobiles. This number would be simple to find on websites and billing.
• Extend contact centre opening hours, potentially from 07:00 to 22:00 from Monday to Sunday.
• Ensure energy providers have the ability to distinguish customers that identify as being vulnerable, as they could be at the risk of issues such as going off supply, running out of credit, or have an affordability issue, and;
• Offer free alternative methods of contact which should include, but not limited to, a dedicated email address and webchats which are fully monitored.

The expectation is that all of the above would be delivered in a fully accessible way.

Whilst those points are just an overview of the consultation’s key aims, it’s clear that any changes would take detailed planning to introduce – especially as Ofgem’s consultation comes at a vital time for the energy industry after three extremely turbulent years, compounded by the energy crisis which saw a rise in the wholesale cost of energy, the pandemic, increase in the cost of living, rising bills, and more complex conversations with customers.

More than anything, these proposals come with many intertwining challenges and that’s where I think the BPO sector can step in and support should they become reality.

Focusing on the detail

Obviously, the vast majority of energy companies have a whole range of water-tight solutions in place that help customers when they make contact. However, a change of strategy and approach would be needed to stay within the new customer regulations.

I’ve undertaken my own research on the key points which has already enabled me to have worthwhile conversations with both existing and prospective clients.

One of those areas has been on the point around energy companies providing an easy access, freephone contact number, together with extended opening hours.

I found that around 50% of companies don’t make a contact number simple to find online or in print, whilst half had a freephone number and the other half used a local rate number. I can see here that Ofgem are suggesting that customers who are on a low income, who perhaps use a pay-as-you-go phone or landline, or pay for local calls, means there is a certain group of customers suffering by not having access to a free telephone number.

However, to change the opening hours will ultimately cost  energy providers more money because if the same number of calls come in over a longer period of time, it simply means more people are required to answer the same number of calls to cover the extended hours.  If work can be blended with, for example, email enquiries, then this may help to improve the efficiency.   

So, that’s just one example where a change in regulations is likely to result in an increased cost. However, what could help mitigate this cost is being able to improve first contact resolution. By doing so, companies will have the ability to stop a second call, thus giving more capacity to answer other calls and drive better outcomes for the customer.

Our expertise and support

We are constantly working with our clients to study the reasons around why customers are calling them and have effective measures and reporting in place regarding first contact resolution, driving right down to agent level which can show who’s performing well, who isn’t and what steps need to be taken.

What we have seen across the industry is call handling times increasing in line with the narrative within Ofgem’s consultation document, and that includes the rise in complex conversations with people who are struggling. Interestingly, we are also seeing clients who previously haven’t asked for support in this area, now looking for advice, with a big topic being how solutions for vulnerable customers can be delivered.

With the consultation document showing that 57% people are dissatisfied with compliant handling, we recognise the difficultly in resolving complex issues and have been discussing with clients about introducing new complaint segmentation processes – making teams who are used to dealing with easier, less difficult complaints handle those, and with more highly skilled teams dealing with the more complex side. With one eye on the future, many are already implementing this way of thinking and organising, but many aren’t.

The other area has been cost, with many energy suppliers worried that if the Ofgem proposals become reality, it will drive down an already shaky bottom line. However, that’s where our offshoring capabilities come in and the low-cost, offshore opportunities offered in South Africa, which can also address the issue around longer opening hours, and in turn, improved first contact resolution. Switching to an offshore service to cover the out of hours could be a cost-effective solution and with many of our teams also being able to support email enquiries, as well as voice, there is a strong case for a blended out of hours team to give you maximum efficiency.

Summing up

Whilst this blog is just a whistlestop tour of the consultation, the issues and the potential solutions, I think it’s vital that more within the energy industry open up about how things might change.

As the regulator, if Ofgem find customer service failings, their enforcement powers can hand down financial penalties well into the seven figures. That’s why I want companies to think differently and see that bringing in a BPO solution and expertise such as Sigma Connected, could ultimately address resource problems and save money.

If nothing is done and energy firms don’t react, then it leaves them open to more problems in the future, along with potential fines and bad press.

Grasping the issue sooner rather than later, having the correct conversations, and being prepared to do things differently, is therefore key.