January 7, 2002—Frost & Sullivan released survey results indicating a general disillusionment among large industrial water customers in the UK with several aspects of their service suppliers’ performance.
Uncertainty over the future structure of the market landscape and a lack of understanding of the likely impact of competition on the market are the hallmarks of the water industry in England and Wales coming to a crucial crossroads. However, with the majority of suppliers adopting a ‘wait and see’ attitude towards the future direction of the market, customers are crying out for the more proactive players to take the initiative and embrace competition by offering innovative solutions to meet their needs.
The company questioned a sample of industrial customers across England and Wales. John Raspin, Research Manager at Frost & Sullivan, reports: “The disillusionment customers expressed with the level of supplier performance serves as a stark reminder for water companies that, despite their virtual monopoly in the water and sewerage industry, customers increasingly exercise the power to switch suppliers or seek out alternative ways of obtaining a suitable water supply or wastewater treatment solution.”
Customer satisfaction is based on a blend of the core elements of the water service (water quality and security of supply) and the more value-added elements, such as customer service and added services. However, the performance of individual companies varies dramatically across each factor. While some companies are developing a competitive advantage, other incumbent suppliers need to rapidly address critical issues to build customer loyalty.
While there is a generally high level of satisfaction with the water quality and security of supply, Frost & Sullivan’s most poignant observation underlines the low level of satisfaction with prices, customer service and added services.
Frost & Sullivan’s analysis of the water only companies’ performance shows that—considering the importance attached by customers to the issue of customer service—the overall supply base needs to prioritize customer service as a key area to improve. Customer service is a very important driver or restraint of customer satisfaction and will subsequently be a strong determinant of suppliers’ success rates in a competitive market.
