KEYNOTE SPEECH at the MIT-EI Symposium on Consumer Engagement and the New Utility

Transcription

1 KEYNOTE SPEECH at the MIT-EI Symposium on Consumer Engagement and the New Utility Cambridge, May 16, 2017 Dr. Klaus Grellmann, MD innogy Consulting 1

2 01 Changing Consumers All around the world we experience a dramatic shift in consumer roles and behaviour Consumers have grown their appetite for green solutions and sustainability want new and digital interactions have greater transparency and market power become prosumers 2

3 01 Changing Consumers Digitization drives consumer cost-consciousness, convenience-, and service expectations Digitization in B2C retail Empowerment of the consumer Increased market transparency Omnipresence of services and products Customization of interactions is changing consumer expectations towards... Increased cost consciousness on low- and mid-price levels Increased convenience expectations (availability, time savings, mobility, ease, reliability, holistic solutions) Higher expectation towards service quality (fulfillment of individual needs) Implications for innogy Improve operating efficiency by E2E automation (RPA) Deliver customer experience excellence, effortless across channels and harmonised across markets Secure omni-channel presence Generate lock-in through non-commodities & bundles Personalize commodity and non-commodity offerings 3

4 01 Changing Consumers Instead of single commodity products, consumers are increasingly looking for integrated energy solutions What customers VALUE: Integration of multiple products and services Solutions that combine hardware and software Brand effect of solution (green and sustainable image) Risk-sharing (e.g. through energy-savings contracting) Energy/ Energy+ demands of a hotel (example) Yesterday Commodity contracts power/gas Today Rooftop PV/CHP Sensors and home automation Storage unit & marketing of excess power/ heat Charging infrastructure for e-cars Energy management for entire facility Tomorrow Power for free? Blockcharge? tbd 4

5 01 Changing Consumers A multitude of new players increase competition in the energy market by fulfilling specific consumer needs Suppliers Retailers Intermediates Solar, CHPs, Storage, Electric vehicles, Insulation, Energy Efficiency 2nd brand Cross-border entriesnew entrants/inde- pendet retailers Local websites Local auctions Local communities White label Small Attacker Brands Hardwar e B2C energy incumbents Comparison Energy Insights, Demand Response, IoT, Energy Mgmt. Software Consulting Energy Management Consulting Services Local contractors & External Incumbent s Heating Telco Gasoline 5

6 01 Changing Consumers In Germany, changing consumer behavior and preferences have spurred the Energiewende GERMANY has ambitious targets until % 2 UNTIL % ENERGY CONSUMPTION of transport 80% Share of RENEWABLES on gross electricity consumption 20% 60% RENEWABLE ENERGY as part of total energy consumption ENERGY USAGE MINUS 25% -80 % PRIMARY ENERGY DEMAND of buildings Renewable energy sources Conventional energy sources 0 Nuclear Source: Prognos/EWI/GWS 2014 GROSS ELECTRICITY generation by energy source , in twh 6

7 01 Changing Consumers The disruption of market principals has put extreme pressure on utilities German utilities under pressure (Euro) Market Commodity trap continued pressure on margins Consumer Demanding holistic, more integrated solutions Competition Increasing competition with better proposition and offering INTE RNAL EXTE RNAL CHALLENGES Cost pressure Ambitious targets are hard to implement Delivery Gaps: E+ cross-sell, fast product development, steering clarity, sales channel management & development Capabilities Cross-selling, segment specific know how incl. data analytics competences Source: Xetra 7

8 02 Adapt to changes RWE has embraced disruption as well as changing consumer preferences and decided to spin-off innogy Structure of RWE/ innogy Conventional power generation RWE AG shareholders 100% RWE AG Trading business innogy SE innogy SE shareholders Explanation of actions IPO and listing of innogy in September/ October 2016 Proceeds from IPOrelated capital increase planned to be invested in further growth in markets with good future prospects Additional secondary offering of existing shares held by RWE RWE AG will remain the new company s majority shareholder after the IPO and consolidate it fully Renewables Grid Retail 8

9 02 Adapt to changes Innogy is built around three megatrends for consumers DECENTRALISATION DIGITALISATION DECARBONISATION 9

10 02 Adapt to changes innogy has become a holistic solution provider, delivering integrated products and services Innovation Renewable s Example 1: Residential Management Install block heating station or solar plant in housing units Example 2: emobility Generate energy from renewable resources Grid and Infrastructure Connect units through intelligent grids Build extensive charging network Retail Develop consumer solutions to consume /market energy Provide user friendly offers, e.g. echarge App 10

11 02 Adapt to changes Some example of our new & digital retail start-ups 11

12 03 Personal reflection Lessons learned: the role of the consumer is ever changing, so we need to be agile to adapt We go through the biggest transformation of the industry since market liberalisation in the 90 s the speed of reaction determines survival and success. This requires SENSIVITY ON THE OUSTSIDE To identify and forecast changing consumer roles & preferences we need to Be consumer centric (e.g. constantly inquiring about consumer desires) Scout technology trends (e.g. identify major changes and technology developments that impact customer behaviour) Watch other companies not just within the own industry (e.g. be prepared for moves from the Googles & Co on your industry) AGILITY WITHIN To address and live the changes we constantly redesign our Organisational structure (e.g. by implementing new steering models) Processes (e.g. by running massive lean and E2E programs) Values & behaviour (e.g. via change methods and agility principles) 12