The 6 key challenges faced by senior leaders in energy and utilities

Harrison Bridge has sought the views of its senior network in energy and utilities to determine what the main challenges are for the year ahead.  Regardless of the organisation type or size, the challenges were many and varied.  The political and regulatory landscape provides little certainty and making a profit is extremely challenging due to cost and competition pressures. This means that a new skill set of talent is required to navigate the challenges ahead.  Lee De Souza explains.

1. RECRUITMENT AND RETENTION

27% of senior leaders reported challenges related to hiring, developing, retaining or upskilling talent.   For one renewable energy business that has a multi-billion turnover, recruiting the best talent is their number one priority after safety.  Talent and diversity in talent is made more difficult in certain areas such as commodity trading as the talent pool appears to be getting smaller.   The current landscape requires individuals to address complex technical and commercial challenges, with few possessing the relevant  required expertise in these areas. Given the current uncertain climate  and market,  finding people with an open and strategic mindset who can think beyond the short term and find practical solutions seems also to be in short supply.

There are several energy supply businesses that that have drastically reduced their headcount or are likely to do so in the future.  Keeping employees motivated in an uncertain market when redundancies have been made, or are going to be made is proving difficult.  One would think that there would be an oversupply of talent in the market, but the skill set that is required for the new world is not easily found.

Some organisations are struggling to retain generation Z whose mindset is to go ‘elsewhere’ if they are not given the opportunities they seek for progression as quickly as they would like.  What is clear is that there is much to learn in both directions across different generations and harnessing the knowledge of younger generations could be key for businesses to plug the gap, particularly in relation to technology.

2. POLITICAL AND REGULATORY LANDSCAPE

The uncertainties that remain concerning a post Brexit UK does little to steady the utilities market.   However, with  a Tory government in situ, some of the outcomes in terms of policy are more certain, particularly versus the Labour manifesto which proposed nationalisation of many companies.

Another main challenge in the eyes of energy and water suppliers is the breadth of regulation, the pace of change and the rise of principles-based regulation. This is a good thing in terms of treating the customer fairly but makes it more difficult to interpret and therefore more onerous on people.

What is the definition of treating a customer fairly and a more affordable payment arrangement?  Whilst technology can automate processes, principles-based regulation requires a different skill set to manage this ambiguity.

3. COMPETITION AND COST PRESSURES

Margins are being squeezed with competition coming from many different types of providers which makes it difficult for businesses to grow sustainably. For energy suppliers, they are competing with third party intermediaries, price comparison sites, alternative providers of energy products and services and oil and gas majors.  Who “owns the customer” in an Electric Vehicle world?  Is it the electricity company or the petrol company of old?   Providers of clean technology need a much deeper relationship with the customer or the technology companies who control the devices.   Investment choices for large energy services companies is critical when the cost pressure from their supply business is so big.

Several businesses have or are about to divest their energy supply businesses.   For those that have acquired businesses, integration and leverage will be key as well as having the right people and skillsets for the future.

4. TRANSFORMATION

Managing costs whilst driving growth at the same time as trying to implement transformation is no easy task.  This is representative of many large energy services businesses who need to do more with less.  I.T is still a key challenge with one of the main difficulties being the transition from legacy systems and processes to new technology with improved efficiency and lower costs that can broaden the customer offering  via digital propositions.

Given that many organisations have multiple external and internal challenges, staying true to strategic objectives in the face of ‘quick wins’ is often forgotten.  This is often down to a lack of focus and chasing too many things at any given time both for small and large organisations.

5. THE CHALLENGES FOR SME SIZED BUSINESSES AND TPIs

A common theme amongst SME sized businesses is cashflow. There are many opportunities to take advantage of, but being able to invest in them requires capital.  In addition, selecting the best opportunity to focus on to deliver the most beneficial impact is made more difficult with market uncertainty.  For those going through funding rounds, this activity is all consuming and the lengthy process means that everything is often put on hold until they have been concluded. Partnering with the wrong investor has many pitfalls.

Many new suppliers are almost completely reliant on third party intermediaries (TPIs) who have grabbed a major share of the market for energy supply.  For suppliers, ensuring they work with TPIs that treat the customer fairly is of utmost importance.   Both the TPI and the supplier want “ownership” of the customer, but will that continue?   From the TPI perspective, they now have a large choice of suppliers they can represent.  Some TPIs struggle to influence the larger suppliers to use new technology, even when the business benefit is clear whereas smaller suppliers appear more agile and open to change.

6. ENERGY SOLUTIONS AND CLEAN TECHNOLOGY

It is felt that the end user is taking more time to take decisions for very larger users of energy.  Purchasing decisions for energy efficiency and clean technology is taking much longer and becomes a CapEx investment decision rather than a revenue one.   The energy user is far more knowledgeable about energy use than in the past and this results in greater due diligence and scrutiny of service level agreements.

The cleantech space is not an easy market with regulatory uncertainty and a challenge to make a profit on projects.  The economics are very challenging and who pays to make it work remains the key issue, which is why many are not just relying on the UK market.

It is felt by some energy professionals that UK consumers are slower to adopt technology in comparison to other international markets which makes market penetration hard.   For those larger energy organisations that have been slower to transition to new energy solutions and new technology, they need to be wary of smaller providers that have been quicker to react and may be more customer focused in some cases.

This article was written by Lee De Souza, Managing Director of Harrison Bridge, executive recruitment experts in energy and utilities. Lee has been the director of three recruitment companies and has recruited entire board and executive teams for energy suppliers, energy consultants and clean tech companies in the UK as well as recruiting globally.

To discuss your hiring needs, please contact  lee.desouza@harrisonbridge.com

 

How to resign and prevent a counter offer

Having helped hundreds of executives successfully resign from their current employer, I have realised it is not an easy thing to do for most. The purpose of this blog is to advise you how to prevent your current employer from making a counter offer thereby putting you in an uncomfortable position and pressurising you to stay. This allows for a more positive exit so you can look forward to working with your new employer.

Coping with self-doubt: Many people feel nervous about resigning; They go through phases of thinking whether they have made the right decision and it’s important to realise that these are just normal feelings. There is always an element of risk in making a move but if you have done your due diligence then nine times out of ten you will be fine.

The key objective is to get your business / boss to accept your resignation: It is vital that your boss accepts your resignation and that you make it clear you are not open to staying. Do tell them you have enjoyed your time working there but at the same time stress your decision to leave is final.

The right use of language: I would recommend using language like ‘This is a fantastic opportunity for me now and in the long term and I am sure you appreciate this is about what is right for me with an organisation I have always wanted to work for’.

It’s not you, it’s me: Be prepared to be asked ‘why are you leaving?’ Again, it is important that you tell them it isn’t about not enjoying working with the business or the role or working for your boss (even though this may be the case). It is about the role and company you are going to.

Stay resolute: They may well be shocked that you are leaving and sometimes bosses (regardless of their level) can react poorly. Make sure you stick to your guns and remain calm.

Discussing your exit: Plan what needs to be done before you hand in your notice. Be clear on what needs to be done before you leave and offer a handover in the coming weeks. Offering to recruit or train your successor may allow you to negotiate an earlier exit.

Counter-offers are about them not you: Counter offers come in many guises with the offer of more money, promotion, ‘big plans’ etc… These big plans rarely materialise, and the stats show that 75% of people that accept counter offers want to move on again within six months. The key question you must ask yourself is – Why are they offering to pay me what I am worth when I decide to leave?  The reason is that replacing you in terms of cost and hassle is significant. A counter offer is more about their interests than yours.

This blog was written by Lee De Souza, the Founder and Managing Director of Harrison Bridge. He has fifteen years executive search and executive interim recruitment experience across several sectors up to board level including nonexecutive appointments.
Lee has delivered over 200+ searches in the UK & Internationally including volume projects and recruiting entire executive teams.

10 Interview Tips For Executives

1) Practice delivering your CV.  In my experience of organising thousands of interviews, the interviewer often asks the interviewee to give an overview of their CV. If you’re an executive with over 25+ years experience and have worked in ten – fifteen separate roles, you do not want to be talking about every single role as you will bore the pants of the interviewer. This overview is effectively a presentation on you!

Therefore, you need to rehearse this pitch and hit the interviewer with concise, punchy information that includes tangible evidence, facts and figures as well key achievements that relate to the job you have applied for. Keep this overview to within 10 minutes. I once remember an MD talking for an hour through his CV for an interview that was an hour long. Needless to say he didn’t get the job.

2) Understand the interview format.  Most interview questions have an element of competency about them. Therefore, most of the time you can prepare for them as the requirements are in the person and job spec. I always advise candidates to use the STAR methodology. i.e. giving a response that includes the situation you were in, the task, the action you took and the result.

3) Be concise.  Every senior role that I recruit for requires people that are strong, concise communicators. Wafflers do not go down well. Know when to stop talking (this relates to answering interview questions and talking through your CV).

4) Look at your CV from a point of weakness.  It is important that you can explain gaps or any roles that may have resulted in backward trajectory. Many executives I speak that have had 20 to 30-year careers have had a blip on their CV and it is important that this is a communicated in a positive way and how you have come back or learnt from those challenges.

In relation to lacking some of the desired skills or knowledge, it is rare that someone ticks all the requirements of a position, but you will need to think about how you can evidence your ability to learn any new skills to fulfil the role.

5) Do your due diligence on the company and the interviewers.  This is as much about being informed for the interview as well as whether you want to join the company. I was recently approached by a candidate who has joined a new company and discovered they are on the verge of administration. Make sure you know what you are letting yourself in for (good and bad).

6) Demonstrate enthusiasm throughout the interview.  I have had senior candidates who have been headhunted for a role look disinterested because they were approached for the role. When they realised it was a good opportunity, they got more interested, but the company was put off by their arrogance. Interviewers are passionate about their business and they are looking for people that share that passion. Give yourself the opportunity of turning the role down if it is not the right fit.

7) Always ask questions at the end of the interview.  Asking questions demonstrates interest in the company. If you don’t ask any, the interviewer will be inclined to think you are not interested.  Some of your questions will be answered during the process and there is nothing worse than having nothing to say at the end. I recommend having ten pre-prepared questions (but don’t ask them all and remember to check their availability for time).

8) How to handle the ‘what are your remuneration expectations?’  You don’t want to sell yourself short and you don’t want to go in too high and put them off. If asked, make sure you list your full benefits as this will influence the salary. I recommend saying something like ‘Obviously the package is important to me. My main motivations are X, Y and Z and I am sure if you think I am the right person for the job, you will offer me the right package’. This allows you to side-line the question, which is often uncomfortable to answer and allows the prospective employer to make you the offer which you can then negotiate if required. If forced for an answer, have a realistic figure in your head as well as a ‘bottom line’ figure where you will walk away if not offered.

9) Uncover any concerns the interviewer(s) might have.  Quite often, an interviewer may be inexperienced, time poor and may have not prepared for the interview. This can result in the interviewer forgetting to ask you questions pertinent to the job and you might miss out on the role through no fault of your own. Therefore, I always recommend asking at the end of the interview ‘is there anything you need me to evidence more of in relation to my ability to do this job?’. This gives you one last chance to uncover any nagging doubts they have about you.

10) Close the interview with a positive statement.  Very few people say they want the job at the end of the interview. Some candidates believe this may make them come across as desperate. I don’t. I believe it sends a positive buying signal to the interviewer and it can be the difference between you and another candidate who doesn’t close – particularly if you are a Sales Director!

Remember, interviews are a two-way process and they are as much about the interviewee as the interviewer. I always think that a candidate’s gut feel says a lot about whether the role is right or not. Does your immediate instinct make you want to jump with excitement or does it not quite feel right? Listen to what your gut tells you!

Lee De Souza is the Managing Director of Harrison Bridge, an executive talent partner that helps companies connects talent and strategy. Contact Lee De Souza at: lee.desouza@harrisonbridge.com 0121 2894293