British Gas chief information officer David Bickerton tells Steve Hobson how the company has recovered from the billing chaos arising from Project Jupiter.

Billing has long been the bête noir of energy retailing. The legacy systems inherited by the privatised industry from the old regional electricity companies often struggle to cope with the demands of competitive markets, customer switching and dual fuel offers. One solution is to rip out the old billing engine and replace it with a modern billing and customer relationship management (CRM) system.

A good CRM system can provide automated, reliable and accurate billing and cope with high levels of customer switching and multiple service offerings. This is what British Gas set out to do with Project Jupiter in 2001, when it commissioned Accenture to install a new £317 million SAP billing system. Unfortunately, the well-documented problems with Jupiter resulted in a spike in customer complaints, loss of market share and a £182 million legal battle between British Gas and Accenture that looks set to rumble on for several years.

The man charged with putting the system right is David Bickerton, who was appointed chief information officer at British Gas in October 2006 after two years with the company. One important goal for Jupiter was to merge British Gas's 18 million gas and electricity customer accounts into a single platform capable of handling 250,000 meter readings and 200,000 bills a day. But it generated a high level of exceptions or errors that required manual intervention.

"The objective was to get all our electricity and gas billing on to one system," says Bickerton. "As a consequence of migrating to the billing system, we ended up with millions of exceptions, which from our perspective were the result of fundamental design issues in the system."

British Gas set about resolving the problems. The result has been a dramatic fall in customer complaints and, coupled with competitive pricing and a strong online offer, a halt in the exodus of customers. At the end of 2008, British Gas had 15.6 million customer accounts, including 2.5 million on prepayment, and the annual volume of incoming calls was down 22 per cent. British Gas's share of complaints to the energy ombudsman also fell to 25 per cent, lower than its residential energy market share of 33 per cent.

"A big part of the progress we have made is that we made the decision to insource our applications capability and re-establish control of what we are doing with our core systems, and not be reliant on a systems integrator," says Bickerton. "There was a real scarcity in the market of people with SAP utility skills and we have built those skills over the past couple of years. We also built a very effective working relationship with SAP and they are an important part of what we do as we move forward."

British Gas started to correct the problems arising from merging its gas and electricity accounts on to the unified system.

"We spent 2007 and 2008 removing the errors from the system, and in 2008 could start to focus on improving the service we offer the customer," says Bickerton. "We have re-engineered our prepayment offer, which we now call Pay As You Go Energy, and those process improvements will go live this summer. We are now in the midst of credit process re-engineering and those changes will be delivered through 2009 and into 2010.

"Another core process that we are in the midst of simplifying is Home Moves, and towards the end of this year customers and our agents will see a significant improvement."

Single view

The goal of a single customer view for gas and electricity customers has now been realised, via a Siebel CRM system that was installed alongside the SAP billing engine. British Gas's parent, Centrica, recently announced plans to unite its retail services under the banner One British Gas. This will bring together domestic and business energy retail, boiler installation and maintenance, energy efficiency services and, in coming years, smart metering. This goal, which had been part of the original Jupiter vision, will see eight million British Gas Services customers migrate to SAP.

"We have one energy customer view through Siebel and then we have other systems that have a view of individual products. At the moment it is too fragmented and is not as integrated as we would like it to be. Part of what we will do in the next two to three years is modernise our CRM platform, and our aspiration is to get to a much simpler data set across all our customers," he says.

The company is some way from realising the ultimate dream of having a customer contact agent able to call up a single screen of information relating to a particular customer when they call. Key decisions are also still to be made about how to manage the large - and growing - British Gas field force.

"We are right in the middle of considering what is the right way forward and we haven't decided how much we deploy SAP technology or the alternatives," says Bickerton. "We will take a look at our requirements and go for best of breed where we can. It makes sense to exploit SAP where we can, but we wouldn't do that just for the sake of simplicity."

Smart metering

On smart metering, British Gas strongly favours an approach where each supplier retains responsibility for installing smart meters for its own customer base, although communications between the meters and retailers will be centralised for the whole industry.

"We have been looking for the past 18 months at what we do in terms of metering integration. Today we already have millions of meters and we are looking at simplifying the integration of existing dumb meters," says Bickerton. "Because the UK energy supply market is so complicated, that is a big driver of errors. We are already well down the road to improving meter integration and have also built the kind of architecture we want to have in place for smart metering. While the smart metering landscape is still far from complete, our intention is to be a position to begin large-scale deployment in 2010."

While the Jupiter project was initially intended to enable multiple product offers to a single customer database rather than in readiness for smart metering, Bickerton says the latest SAP billing system will be smart-ready.

"From the investment SAP is making, and the investment we have made with SAP, the technology aligns with smart metering," he says. "Earlier this year we completed the upgrade to the latest version of SAP, which means we can take advantage of the enhancements that are coming. The use of SAP for smart metering is going to be key."

Developing the back office systems will be made far easier because British Gas now has its own 270-strong in-house IS team, which includes 80 SAP applications specialists, sitting with the business managers at the company's Staines campus. Bickerton says: "We will never hand over a core system to a third party again, though we do have good relationships with two or three organisations that support our IT and coms infrastructure, and that model has worked well."

Letter:
Dear Utility Week

Your article "One Planet" (24 July 2009) could leave your readers with the misimpression that the billing system Accenture developed with Centrica up to March 2006 is responsible for Centrica's poor customer satisfaction levels and a loss of market share during 2006 and 2007.

Whether any issues with the billing system were the responsibility of Accenture is, of course, one of the questions that the High Court will consider at trial in 2010 or 2011. While Accenture will not discuss or debate the merits of the case in the news media, your report omitted facts that your readers need to make a fair and accurate evaluation of the situation.
1) The system first went live in August 2005 with a 50,000 customer pilot, and the first volume migration to the system took place in December 2005, with 1.3 million customers migrated onto the system.

2) By the end of March 2006, there were over 4.5 million customers on the billing system, which was operating without excessive exceptions and handling call volumes better than anticipated.

3) At that time, Centrica decided to undertake the rest of the migration itself, and to take the maintenance of the system back in-house. Accenture did not have day-to-day involvement with the system from that time onwards.

4) Centrica itself admits that it didn't become concerned about the level of exceptions experienced until the second half of 2006, months after it took sole responsibility for the billing system.
Accenture does not accept Centrica's allegations that there were issues with the system design. As will be apparent to your readers from the above facts, contrary to what is suggested in your article, problems only started to arise after Centrica took the business decision to take the implementation of the system back in-house.
It is Accenture's position, that these problems were caused by Centrica's lack of readiness to take responsibility for the system from March 2006 onwards, business decisions it then took that affected system performance, and how it chose to implement the system, including how it undertook the migration of the remaining accounts.
We are confident, based on the facts of the situation that Centrica's claim is without merit. That is why Accenture will continue to vigorously defend the High Court proceedings which Centrica commenced.
Yours faithfully
Mark Radvanyi
Head of Accenture Media Relations, UK & Ireland

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