Fixing water market data

The retail water market can learn from the mistakes made in Scotland and go about collecting basic, reliable data – starting from the bottom and working up. Charles Vincent writes.

Data issues in the Scottish, and latterly the English, non-domestic water markets have been challenging to rectify and cleanse. Almost a decade of competitive water retail markets, with Scotland opening in 2008, shows that it is very easy to be busy fools with respect to data projects.

With England experiencing all the same (and more) issues it is important that the industry does not again focus on seemingly urgent issues rather than taking a step back and dealing with data issues in a more strategic, collaborative way.

The result of not always doing this in Scotland has been huge amounts of customers’ money (which in the end it all is in a competitive market) being spent on massively inefficient, but not without benefit, data projects. Where market participants have acted strategically and collaboratively, massive and cost-effective improvements have been achieved.

Taking a wider view outside our industry, Maslow’s hierarchy of needs states that until people have dealt with their basic physiological and safety needs (food, water, warmth, security, etc) there is little point worrying about our psychological needs of belongingness, love and self-esteem.

The same is true of data in the water market. Until the sector has dealt with eligibility (should the property be in the market at all?) and identity (are we all talking about the same property?) any focus on things such as meter details, occupancy or customer email addresses is likely to be inefficient because in each case we need to know if the property should be in the market.

After that, the key order questions should be asked in are:

1. Should I worry/is it in the market?
2. Should I bill?
3. What is the bill (amount)?
4. Who should I bill?
5. Do I understand my customer?

An excellent example of this is the huge amounts of effort and money that was spent on establishing occupancy in Scotland by sending people in vans to look at properties to see if they were occupied. While this seems on the surface to be a great idea and in most cases undisputable, the issue was that in many cases properties were duplicates, had inaccurate addresses, needed to be split/merged or had other eligibility related issues. As a result, there was a massive cost to the process of establishing eligibility on an individual basis, rather than in bulk, which the Central Market Agency (CMA) in Scotland with their Utility Week-Award nominated Assessor’s project proved could be done in an extremely efficient and cost-effective manner.

The CMA did three key things right with this project. The first was to work closely with all the involved stakeholders – Scottish Water and retailers being the key ones. This ensured that all had their voices heard, allowing for their ideas to be incorporated into the project and any concerns dealt with early to maximise buy-in to the project.

Second, they spent time (over a year) planning and designing a methodology that used the best knowledge from the market and outside. Finally, they started at the bottom of the hierarchy, seeking to ensure that all the properties that should be in the market were so, and identifying those that shouldn’t, while also flagging other issues such as splits/merges and poor addresses.

The result of this was tens of thousands of data corrections being identified upon which other participants could build, safe in the knowledge that they were building projects on solid foundations and allowing things higher up the hierarchy to be dealt with efficiently. Scotland nine years on still has significant data problems, but things are definitely on the mend as a result of this project.

It does not, however, have to be the market operator who asks. Indeed, any participant in the market could have taken a similar approach, The key is ensuring buy-in, designing a quality methodology, and finally starting at the bottom and working up. This approach can be adopted by wholesalers, retailers or market operators and, indeed, should be. All participants in this market need to make a commitment and investment to data quality.

So how do we take this and apply it to England? Since the English market opened, much of the reporting has involved the fact that a lot of the data in the market is poor and will cause significant issues for all involved.

As a result, many have started running around trying to think of quick fixes, when in fact we have to accept that there is no quick fix. Instead the sector needs to pause, plan and implement, based on the hierarchy, in the knowledge that while it is neither a quick nor easy fix, by doing so the industry will maximise the effectiveness of our focus and spend on data and that in the long run is the best solution for everyone.