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Unless considerable investment is made in restructuring the water industry to create independent distribution businesses and the supporting mechanisms required for a competitive market, successful competition within water is extremely unlikely.
But is there another way? A way in which the benefits of competition can be realised without incurring such heavy costs?
In considering this question it's worth standing back and reviewing the objectives of introducing greater water competition. At the most simplistic level, the aim is to lift the level of service delivered to the customer beyond that dictated by the current, basic “hygiene factor” measures (e.g. water quality, water pressure, etc). The obvious question however is - how far do you go? Within a competitive market service levels tend to find their own balance in much the same way as service choice naturally evolves to address market opportunities. Without competition, how does one ensure that similar levels of service and choice are achieved? And how does one ensure that realistic targets are set that sufficiently address customer expectations - without being excessively onerous on the suppliers?
In March 2008 Ofwat reviewed the overall performance assessment and regulation of service to consumers. An OPA brief was written and published on the Ofwat website which included Customer Value Management methodology developed by SECOR. To view this brief please visit the Ofwat website.
To view the full white paper on this and other related subjects please visit the SECOR Library.
In April 2008 Utility Week published an article called 'The Customer is King'. This was written by Gordon Todd, Head of Customer Experience at Business Stream explaining the importance of resolving customer debt issues quickly and how it has enlisted the help of SECOR in order to monitor and manage overall customer experience. The full article can be viewed here.
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