Involving consumers of public services - lessons from the water industry
Customers are the life blood of any business and should be the focus for every public service. However, in regulated sectors and in public services there is a danger that the customer voice is less strongly heard and it is easy to think of customers as passive receivers of utility services. This is particularly the case in the water industry - a far cry from 60 years ago when my father celebrated the fact that we would no longer have to get water from the well !
This is why Ofwat, as the regulator for the water industry has set its vision “ to put current and future customers at the heart of the way companies run their businesses.” Since 2013 Ofwat has required each water company to set up an independent Customer Challenge Group (CCG) as a key means of delivering this vision. Since February I have been chairing Dwr Cymru Welsh Water’s Customer challenge group, taking on the mantle from Diane McCrea who now chairs Natural Resources Wales.
The CCG is not a representative structure and also should not be confused with the statutory role of the Consumer Council for Water . It is though an independent group, bringing together a range of expertise and networks that can work alongside the company to ensure that the company’s business plan meets the needs of all customers. It has a particular responsibility to reflect the needs of vulnerable customers, who find it most difficult for their voice to be heard and those future generations of customers who do not yet have a voice, but whose needs will be met by decisions the company takes today.
Today we are seeing huge changes as technology empowers consumers making them smarter, better informed and more demanding than ever. Despite our largely passive relationship with waste water and supply, the water industry is not exempt from these changes as can be seen from the responses when things go wrong and the greatly increased flow of social media traffic Our key role as a Customer Challenge Group is to ensure that the customers are involved in business planning and that their views drive decision making .
Dwr Cymru Welsh Water is rightly proud of its distinctive not for profit model which means there is already a different relationship with customers than the other water companies in England and Wales – although well under 50% of customers currently realise their water company is not for profit. This gives customers the added role of helping to decide how the company should reinvest its profits, with over 12000 customers being involved in the recent consultation on how the company should spend its millions of pounds of potential profit.
Over the next 2 years we will be ensuring that the company reflects customer interests in the business plan proposals that will form the submission to Ofwat’s 2019 Price Review. This will involve overseeing detailed customer research, drawing from the range of customer day to day interactions with the company and ensuring that we draw on best practice from other companies and sectors.
The independent CCG brings a range of relevant expertise and reference points to ensure the company is both challenged and supported to ensure that customers at the heart of how the company operates. There are important lessons for all providers of services – public , private or mutual – as today’s active consumers are an asset for innovation and encouraging them to participate in co creation has the potential to deliver far better solutions that businesses or public bodies can achieve alone.