Page 5: Implementing a strategic vision
ScottishPower has gone a long way towards implementing its strategic vision. This case study has shown how ScottishPower has moved into a diversity of utilities - most recently by acquiring Southern Water so that it has added water supply and sewerage services to its portfolio.
The popularity of offering multi-utility services is already in practice. For example, one of ScottishPower’s largest industrial customers, in addition to taking electricity supplies, now uses the telecommunications, technology services, contracting services, energy management and power quality management services. Because the organisation has an excellent cash flow position, it is able to plough extensive sums of money into improving and developing the services that it offers. For example, this is how ScottishPower will be able to meet the significant capital investment programme required by Southern Water in the medium to long-term period.
Working from a strong existing base, ScottishPower is able to develop new business interests, turn them into successes and generate an even stronger business base. The multi-utility strategy is based on economies of scale, customer orientation and sound business sense. ScottishPower now has five million customers across England, Wales and Scotland.
1998 and beyond
The multi-utility strategy is a forward-looking strategy, which should gain further impetus when the gas and electricity markets are liberalised in 1998. ScottishPower aims ultimately to expand internationally when the opportunities arise.
ScottishPower believes that after liberalisation of the domestic power market in 1998, only the most competitive companies are likely to prosper. Those which have benefitted from cutting costs wherever possible (without compromising service) will be able to gain. The savings gained from centralising, where possible, administration and customer service functions through the multi-utility operation, will keep ScottishPower among the most competitive. The quality of the ScottishPower brand name enables the organisation to be successful in a variety of new utility areas so that considerable synergy is achieved by operating on a grand scale. The emphasis is always on providing value for money and on building a strong personal relationship with customers.
ScottishPower believes that there are many overlaps in running a utility business and therefore some skills are cross-transferable, such as dealing with industry regulators, managing assets and a large customer base. Other operational benefits include:
- Increased purchasing power
- Single wayleave and record system
- Single design, cost and tender resource.