I don’t think there is ever a good time to stop innovating – in fact I believe it is a core value to drive innovation on a daily basis for all successful businesses.
So I was amazed to see that E.ON – one of the UK’s leading energy suppliers – is to close its innovation arm.
Energy brands are often viewed as a commodity service and consumers are encouraged to switch suppliers based on the latest price deals – especially true when their prices are regularly increased as they are at the moment.
This is exactly when innovation needs to play it’s part by adding new value to customers.
Surely there are lots of opportunities for E.ON to help us change our consumer behaviour and usage of energy. Not just in providing innovations such as renewable energies and services that make our energy usage more efficient but also in amazing general customer service and marketing initiatives that create more valued & loyal customer relationships.
I’m sure that E.ON will say something like ‘innovation is core in our business and doesn’t need a separate business unit’ but from my experience a company as large and important as E.ON this is not enough to deliver the big changes that are possible.
At at time when there are a number of small businesses developing interesting new energy propositions such as the Nest learning thermostat in the US the big energy suppliers – like the big telcos before them – run the risk of becoming even more like a ‘price led commodity’ than ever before.
Still, all the time energy suppliers are able to set and follow their competitor prices in a ‘near-cartel’ fashion maybe they are content not to take the risk and effort to invest in innovation and simply suck-up the almost guaranteed profits that the sector provides.
I hope this is not about the lack of value of innovation to energy companies but perhaps more to do with their ability to harness and execute it properly in the business.