SAP : For South American Utility Companies, Digital Transformation Starts with Culture

For utility companies Abastible and Edenor, improving customer experience starts with employees.

Abastible has been providing energy to its customers in Chile since 1956. As a subsidiary of the Chilean Petroleum Company (COPEC), it is one of the country's three main utility providers and was recently recognized as the leader in corporate reputation for the third year running.

But to keep its good standing with customers, Abastible knew it needed to innovate, which included a pivot toward renewable energy sources. Paulina Toro, Human Resources (HR) manager at Abastible, says, 'Our management decided that gas-powered electricity was not enough in this world. We needed to create clean energy alternatives as well.'

The company also know it needed to deliver great customer experiences by creating offerings that made people's lives easier and more efficient. Management viewed digital transformation as the key to innovation.

Toro explains that adopting digital technologies would also help create new business models to spur growth and gain new customers. 'For us, digital transformation is about survival and continuing to gain customers,' she says.

If Abastible kept the same business model, the company feared it would inhibit growth. With the expansion across South America to Colombia, Peru, and Ecuador, Abastible had prioritized innovation to help compete for both B2B and B2C consumers in these markets.

Abastible Nurtures an Innovative Mindset

One example of Abastible's customer-focused innovation is an app that allows people to order propane gas, measure how much is left in their cylinder (in Latin America gas is delivered to homes and businesses in cylinders), or check their account at any time. Previously, these activities required a phone call to customer service during regular business hours.

But Toro points out that Abastible's efforts to become more customer-focused and think digitally about innovation required a culture shift using cloud-based SAP SuccessFactors solutions for human capital management (HCM) to help build a more innovative mindset.

'[SAP] SuccessFactors helps us to be much closer to people. It also supports our employees' effort to have more agility in all the operations,' says Toro, whose team previously used a manual system to engage with employees. Now they have education and self-service tools - all available on mobile devices. 'People see us differently, more available to help people.'

But more important, she says that since the system went live late last year, 'the perception is that SAP SuccessFactors is helping employees to think digitally. Because we've moved to self-service digital HR processes, it's helped build a digital mentality amongst employees.'

In the future, Toro hopes that SAP solutions will help management to understand what employees think and feel about various corporate initiatives.

Abastible also uses SAP software for its enterprise resource planning (ERP). The Colombian subsidiary has deployed SAP S/4HANA, the latest version of the flagship ERP suite.

Edenor Recognizes the Importance of Cultural Change

In Argentina, Edenor is the biggest power company, with 3 million customers in Buenos Aires city and the northern area of the country, and 5,000 employees. The company has used SAP software since 1997 for core business functions, including field operations and powerline maintenance. SAP solutions also form the IT backbone that supports all back-office and administrative activities.

Like Abastible, Edenor is undergoing a digital transformation and, similarly, cultural change is critically important. Chief Information Officer Luis Lenkiewicz says, 'The company is changing its internal culture. Before, we were oriented to the field, not the client. Now we're more focused on our customers.'

Lenkiewicz explains that the company has had to adapt to new government regulations for utilities in Argentina. Since the economic crisis of 2001, the government had subsidized and set energy tariffs. 'But two years ago, the new government deregulated our industry and we were able to set prices. So now we need to focus on the client experience. This has really impacted our process, culture, and technology.'

Industry experts also see a corporate trend toward becoming more customer-focused across Latin American. 'In Latin America, 37 percent of businesses mentioned that their digital transformation goals are aligned at the enterprise level to near-term strategy - and include digital customer product and experience initiatives,' said Juan Pablo Seminara, program manager for Consumer and Enterprise Research in Latin American at IDC.

Lenkiewicz explains: 'We're trying to become a customer-focused company so it's really important to have the technology to support those processes.'

SAP SuccessFactors offerings and cloud-based collaboration tool SAP Jam Collaboration have helped the company align employees toward its new mission and encouraged them to work together, breaking down silos across departments.

In one example of early success, Edenor has optimized its supply chain. Now, with a more efficient way to predict and procure the materials required to create power, the company can provide better customer service and respond to problems more efficiently. For example, if a blackout occurs, the team has the resources it needs to restore power more quickly.

Moving forward, the Edenor team is working with partner Edison to map out a digital footprint for all its business processes. This will help improve and simplify workflows, allowing Edenor to increase agility and provide a better experience for customers.

Read more:Digital Innovation Fuels Growth for Utilities from the UK to Brazil