B2B Bussiness transformation and turnarround

Context

One of the leading global renewable utility company owned a loss making B2B business consisting of five (5) energy retail businesses in UK, DK, SE, GE and NL, Energy consultancy, EasS and City light.
In total 1B€+ revenue, 350+ employees, 600K+ customers, 85GW Energy. Despite earlier changes the retail profit have been under pressure and the new started energy solution business, for 2 years, unsuccessful. The CEO requested an overall improvement plan and strategic recommendation(s) aligned with the company strategy.

Approach

The first step was to build a small core team with existing B2B business leaders and external consultants. The seven-step process was particular focused on;

• Market analysis for energy retail and EasS, Voice of the Customer (60 interviews) and competition analysis
• Benchmark operational models for retail businesses (Energy, Telecom)
• People engagement and motivation
• Develop a strategic and go to market plan with recommendations for the various B2B businesses

Key findings

1. MARKET; The energy B2B market is challenged by flat volumes (1.5TWh) largely driven by companies optimizing their energy consumption. Switching rates have increased due to digital solutions and new entrants. The energy solution market (50B€ in 2025) has emerged with more attractive outlooks (~8% CAGR) than the traditional commodity markets. Manufacturing, Chemicals, Food & Beverage are attractive segments due to high consumption and the cost factor of energy related to their production cost.

2. CUSTOMERS; From extensive customer research we saw unfulfilled customer needs related to energy in four (4) areas. i) Continues drive energy and cost efficiencies, ii) Ability to improve risk profiles, iii) Enhance green profile, iv) Partnership engagement for a single-entry partner to collaborate with on identifying, generating and sharing benefits of energy improvement.

3. PEOPLE, ORGANISATION; A siloed Country by Country operating model with individual strategies, operations and functions are in place without leveraging synergies. Cost to Serve (CtS) is 60% above the market benchmark. Talented employees and Hi potentials are identified however mainly skilled in Energy retail and limited on consultative selling and delivering complex solutions. Go to market approach is not consistent for EasS and energy retail across Europe. Employee engagement scores are below company standards. Employee survey results showed need for regular communication, clear mission & purpose and change rationale.

4. COMPANY STRATEGY; Overall company strategy is evolving and focused on expending the renewable energy generation global footprint. Merchant risk mitigation become critical due to fading away of subsidy schemes to support renewable build out. Selling and delivery of large volume of green energy to large consumers is essential in the future.

Solution

NEW OPERATION MODEL – A new functional Operation Model with one customer facing commercial front end and competence centres for energy retail and EasS with focus on large C&I consumers. Commercial front end focused on industry verticals (e.g. Food & Beverage, Manufacturing) and named accounts (500). Develop excellence in solution selling, C-level relationship management, market & customer intelligence and digital marketing. Carve out non “large C&I businesses” (e.g. City light, Energy consultancy, SME) into a separate unit with aim of divesting

ENERGY RETAIL CoE – Digitalisation and consolidation of individual country operating systems and organisations into one efficient support team and cloud-based system. Maintain customer satisfaction levels but reduce OPEX with 22%. Rationalised product portfolio focusing on merchant risk mitigation and enabling EasS offerings. Carve out SME retail businesses in a separate business unit with the aim of divesting.

ENERGY as a SERVICE CoE – Shift from “everything to everyone” approach to modularised solution portfolio with clearly articulated value propositions and tangible benefits for C&I customers. Target specific industry verticals with revised EasS product catalogue enhanced with other energy solutions such as green hydrogen, solar and waste to energy.

PEOPLE DEVELOPMENT, COMMUNICATION – Restructuring of workforce (16%) due to new operating model. Implementation of a communication plan including i) monthly update calls and Q/A, ii)Start Chats iii)Breakfast chats with engagement of the entire leadership team. Establish development plans for Hi potentials and establishment of cross-country teams to solve challenges and develop new solutions.

Board approval & Implementation

Analysis, strategic recommendations, planning and action plan was developed in 3 months. After board approval and green light from the working counsel the new operating model have been implemented in one go in order to create a Day 1 organisation. Fine tuning of the model took place in the following 2 months. In parallel the CoE for retail started the digitalisation effort using agile working methodology. Step by step, in a period of 2,5 months, the retail customer journey was digitalised and new OPEX level reached. The modularised approach for EasS was operationalised in 2 months continued by regular account plan reviews to increase hit rates.

Results

The vision and strategy implemented through the change plan delivered 12% profitable growth. The previous unsuccessful EasS business closed 4 contracts in year one with 8 LOI to be closed in year two. Despite all changes the customer satisfaction levels remain high and employee engagement increased with 13%. CEO commented:” it was the first time in 6 years that we have a profitable B2B business and a sustainable B2B strategy aligned with the overall company direction”