Utilities Tech Outlook Weekly Brief
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Utilities are now leveraging data analytics to strike a balance between absorbing customer arrears and chasing down payments.
FREMONT, CA: Developing smart and focussed debt collection tactics to help lessen costs, save time, and maximize resources is essential. A report revealed that 1.4 million people in the UK have utility bill debts, of which only 11 percent have contacted their supplier. 16 percent of consumers thought their provider had been very unsympathetic. Another 15 percent said they were made to feel under pressure to repay the arrears. To avoid such instances in the future, suppliers are providing personalized treatment that customers expect, particularly around such a sensitive subject. A unified approach driven by analytics to debt collection has become a need of the hour.
E&U companies look to balance the requirements for proactive identification and management of high-risk clients on one hand and heightened customer experience on the other, with the help of smart data analytics. As the utility industry emerges, there seems to be a progressive understanding of this opportunity with industry leaders who acknowledge that there is a way to recover profit from zero-valued assets.
Regulators are meticulously regulating E&U corporations from turning away clients defaulting on bill payment. Organizations should devise innovative methods to eradicate negative fallouts arising from wrong actions. Identifying and prognosticating payment conditions and ensuing customer behaviors thus becomes critical. Internal data from organizations' systems and external data from social media are expensive inputs for risk-based evaluation of client accounts. And predictive analytics can append muscle to optimize lousy debt collections. The right segmentation of clients, predictive analytics can provide precise insights into customers' intent and ability to pay.
Regulators across the world are training their sights on varied aspects of consumer collections. A business's most worthy asset is the data it possesses. By using this data, utilities can advise customers to agree to a re-payment plan by launching personalized and targeted campaigns via letter, email, or other digital channels such as text messages. There is no silver bullet to counter the growing pile of debt as it is a crucial step to recover aging debt and ensure that suppliers do not miss out on revenue.
Industry factors are likely to make processes more efficient in the long run. It will take more sweeping changes within the suppliers for the dividends to be realized in short to medium term. When handling customer debt, internal methods can be challenging for utility businesses. To counter this, suppliers have generally created specific sub-teams focused on managing maturing debt, or outsourced debt collection to third-party service providers. These problems have been magnified by increasing levels of price competition and customer churn, as suppliers take on financially high-risk customers to boost market share. Utilities are increasingly modernizing their infrastructure and embracing more technology-driven initiatives.
Having the appropriate data and systems to access, understand, connect and manage huge volumes are the keys to boost debt management. This demands the accurate talent, tools, reliable insights and the experience to execute timely actions. The data value chain is impeccable only when insights are modified into effective business processes for multi-channel customer engagement that determines advanced analytical use cases.
