Friday, 19 October 2012

"Charge The Least" - How to put David Cameron's idea into action

A wish by the UK Government that energy companies should be forced to charge customers the lowest price has been in the news lately.

However, HMG seems to be rowing back, possibly motivated by the fear that energy companies will simply raise prices, as some have apparently threatened.

So things are going all blurry.

The latest I've heard is that energy price plans will get labelled with some kind of 'APR' style tag. This sounds complicated, and indeed silly. The problem is that competition isn't working - so the answer is either to accept that energy competition is lackluster and patch up an answer, or to provoke competition.

I have two simple suggestions.

1. Just do it! Bill the lowest price plan.

By comparison with your mobile phone operator, energy suppliers have a very easy job billing you. In go meter readings (real or estimated, manual or automatic). They go through the logic of your price plan (for instance, this fixed fee and that price per unit). And there's your bill. Hey presto!

Speaking from direct and personal experience, I can tell you categorically (i) that every leading billing system out there has the ability to run billing data through as many plans as you like, for comparison or to apply 'best price' logic; (ii) every legacy system I've met can have this feature added quickly and cheaply, with the only appreciable long-term cost being the additional microseconds it will take to calculate each bill.

So the simple aspiration, "Charge the least," can be achieved technically, cheaply and quickly.

But there are two objections.

a) "But we'll just have to raise our prices."

It's trivially the case that if energy suppliers had to charge the lowest price, and that most of us are on the wrong price plan, then their revenues will be hit. 

But neither the government nor consumers need to care about this. There's no suggestion that new, lower prices should be introduced, only that the existing plans should be applied to the benefit of consumers. In other words, the complexity of pricing, lacklustre competition between increasingly vertically integrated energy companies, and consumer inertia have produced surplus profits.

An energy company can raise its prices to make good this shortfall. If the market is competitive, other players can choose not to follow suit - and gain a competitive advantage. And if all industry players act in the same way, the regulator and, if necessary, the Competition Commission can take action against such apparent oligopilistic behaviour.

b) You can't compare apples and oranges.

It is true that, while the basics of energy billing are simple, there are potentially important differences. The two main differences are: how do you pay (e.g. with or without a direct debit); and how long do you commit (e.g. the contract is for a minimum one month, one year or two years - the kind of thing we have to decide for instance when we sign up for broadband services or pay TV).

Yes, this means that it's not 100% achievable for every consumer to pay the least every time. But no, this doesn't kill the idea.

In this and other industries, direct debit is viewed as a benefit to the supplier, that can be rewarded by (say) a £5 reduction. So it's perfectly easy (a) to calculate the best deal with and without DD and display both, (b) to apply the relevant offer based on the customer's choice to pay by DD or not.

Contract periods are similar, but the reward is often a little more complicated - a price plan with a monthly commitment may be quite different from an annual one. And in regulated industries, there's always a concern that powerful players will artificially inflate the difference, which creates huge barriers to entry for a competitor (think what it's like trying to change your mobile phone operator six months in to an 18 month contract - you're locked in, and competitors are locked out).

So an answer in this case seems to me to be:
  1. Make the 'best price' logic apply within the customer's chosen contract period rather than to all price plans
  2. Display the best prices under different contract terms
  3. Require that any customer changing contract term with their supplier has a 30 day right to cancel and sign up with another supplier
  4. Give customers a similar 30 day right to terminate a contract early and without penalty following any price increase by a supplier

2. "Green Button" Innovation

In the USA, President Obama introduced a voluntary (for the industry) scheme, motivated by the desire to help customers reduce their energy consumption. 

The idea is that your supplier gives you access to your customer information (present and past energy usage) in a simple, standard way online.  Which doesn't sound so revolutionary. The magic is the next step.

It's not just your right to access your data, but your right to let an app do the job for you. So instead of relying on the energy companies, for instance, to display the information to you in graphical form, to help you compare your energy usage to statistics for other similar households and so on - third parties can do that, at no cost to the utility.

We could do that too. 

Now, guess what? A mandatory green button scheme in the UK would also allow people to create apps to compare prices - what you could have paid with any and every alternative supplier now and back through previous bills - and into the future, based on projected use.

So if the UK Government decides to back away from relying on energy suppliers to optimise pricing for consumers, the Green Button option might be even more powerful - because it would give consumers ownership of their own data, which we could then all use both for green reasons (cutting down usage) and to help us access a competitive market, with a simplicity and confidence that would overcome the confusion and inertia that leaves most of us out of pocket.

A Call to Action

These aren't the only options. There's a host of possible regulatory changes, some of which may be more potent in the long term.

But I do like simplicity. So how to choose between these two? Don't choose! Leave the choice to the suppliers!

Why not challenge every supplier to implement either automatic bill optimisation, or Green Button data access, or both by (say) April 2013? And require all operators to indicate in a standard way whether they have signed up to one, both or neither scheme in all advertising and on every customer bill. 

Do you know what? I think this cunning plan might just work!

Wednesday, 23 May 2012

It's good to fail... fast

A little under a month ago, some friends and I announced an offer to launch a free service - free to set up, free to use, free to leave, free of advertising. The service is a way of getting up and running with a modern, social web site - that's the technology - and a community of willing helpers collaborating to get better results for everyone.

It was for a specific niche - UK churches. It was to address a specific, known problem - that (according to a recent study) the vast majority of UK churches don't have a current, active website at all. And of those that do, a small proportion are interactive as well as active - that is, most church websites are brochures to read rather than communities meeting and welcoming others.

We had direct experience (independently of one another) of some of the underlying issues. Many churches struggle making decisions involving expenditure more complicated than buying another box of tea bags. People with relevant skills often feel put upon, expected to do for free what they are normally hired to do, and faced with unrealistic expectations ("you do websites, don't you?" = "I don't care if you're a back end developer, a front-end developer, a designer or an account manager, just make my problem go away, now!"). And the "norm of niceness" that infects so many churches means that everyone knows what they don't want, few will be willing to turn their vague thoughts into definite ideas, and a dominant voice will effectively dictate the outcome.

We didn't think we wanted to tackle those issues - there are plenty of companies selling outdated, proprietary CMS-driven websites to churches, driven by their ability to navigate the particular buying and implementation processes. Good luck to them! Most are well-intentioned, at least, and a few are quite good.

Instead, we saw an opportunity. We're people who know how the technology works and how costs build up, and so we were able to define a technical solution that would cost a few hundred pounds up-front to create, a few tens of pounds a month to run, plus time and goodwill. We decided to build on WordPress, because (a) it works, (b) it has a vast resource base, (c) the software is free to take, use and adapt. We identified multiple ways to create the service, and looked at take-on (making it easy to get people from nothing to something nice-looking and actually usable) and push-off (making it easy to get people off our platform and onto their own or someone else's). And we did technical validation - yes, it works in practice as well as in theory.

So we got to the 'ready enough' point. We knew we could create the service, and we knew our way around the detailed options we would be choosing between. So we knew we could build a real, live service to meet the promise with a few more hours of work up-front, and a reasonable enough workload in terms of hours per week post launch.

So we launched. Sort of.

Specifically, we said we'd launch the live service if 50 UK churches wanted a website for free. To signal this, they had to tweet a hashtag, like a facebook page or fill in an online form. All of these things required a small amount of effort, and we didn't work hard on promotion.

We got into double figures, but nowhere near the 50. So we won't launch. (I predicted we wouldn't!)

We failed. We failed fast. It's good to fail fast.

You can't fail unless you try. Most people talk a lot about things they want to do, very few try to do them.

Until you fail, it's hard to learn. Most projects exist in a kind of twilight world, where the expectations and effort have gone down, but there's still a dream. By saying "we've failed - and we're moving on," you get to look at things objectively.

And when you fail fast, there aren't so many loose ends to tie up. There's no long, painful running uphill, draining your practical and emotional resources to the dregs. So the learning you achieved, you can apply. Or you can choose another venture. Either way, you start with a positive attitude and a bit of momentum, released by being prepared to say, "That's it. We failed. Now, what shall we do?" Well, almost every meaningful success has come off the back of one, several, many failures. The trick is to welcome failure, and fail fast.

Or, as Samuel Beckett said, "Ever tried. Ever failed. No matter. Try Again. Fail again. Fail better."

Thursday, 26 April 2012

Churches, the web, social media, all that

Why did books take off? You know books - those things where you make flat sheets of paper, bind them together - those things. Why did they take off? Well, at least one of the reasons was that they were a very good way to get to the Bible and its constituent bits - way more convenient than scrolls. And when printing made its way to Europe, what rolled off the presses? You guessed it!

Books weren't the only way the Bible moved round the world, but they were pretty important. And the Bible wasn't the only text that became widely distributed in book form, but it was a biggie.

So why are churches so far behind the times when it comes to the web, facebook, twitter, tumblr, even email? Er, good question.

And as far as I can tell, five of the leading answers are:
  1. We don't want to commit to anything too new: we already have an OHP, a church noticeboard and a hearing aid loop, and that'll do for now
  2. Printed books are cool, especially when they have rainbows on them, but the Internet is Satan's sock-drawer, full of ne'er-do-wells and general naughtiness
  3. We don't know how to do this, and all we hear are horror-stories of aged websites that make us look really, really stupid
  4. We already have a website: here! (I wonder who uses it...?)
  5. Haven't you seen our online presence? We have a search engine optimised website, all our rotas are online, our facebook page is humming. Behind? 
(In the interests of disclosure, I'm an ordained minister in the Church of England, so you could say I have a professional interest. I would welcome any contradictory views on anything I say here.)

If you're in category 1, I suggest you go and ask half a dozen under 30 whether it's too early to risk this. If they all say 'no' then well done, you can bide your time.

If you're in category 2, then ask yourself, if Jesus rocked up to your town, would he be hanging out at the church bookstall, and if not, where, and who with? (For those of you reading this paragraph who are now going, tsk, this guy doesn't even know it's "with whom," I give up!)

If you're in category 3, then I have good news and bad news. It's simple... But it's not easy.

And if you're in category 4, then I have bad news and good news. You need to start again. But at least you have an idea, now, of what's good and what's bad.

Finally, if you're in category 5, then congratulations! Now, you have some work to do: help another church get (at least some of the way) to where you are.

Now, some friends and I are trying to do just that. Here's how.
  • We won't spend very much money - we haven't got much to spend if we wanted to
  • We're building the whole system using WordPress (which apparently powers 8.5% of the whole Internet), so the skills people will need to have or develop are widespread, as are learning materials
  • We're making it easy for people to get started - our assumption is that everyone needs things to be super-easy
  • Our objective is to meet everyone's needs in getting off the ground - and we'll be happy when people outgrow the service
  • We'll make it easy for people to migrate away from our service
  • If 50 churches sign up for the private invitation, we will launch; if they don't, we won't
  • The cost to sign up is £0, the monthly cost is £0, the cost to take your site somewhere else is £0
  • We won't inject adverts into your website - it would be lovely if some people donate towards the running costs, but if they don't, we'll manage
  • If anyone wants to help, that's good too - we'll run non-profit, so your reward won't be ££££s
Privately, I don't think we'll get 50 takers. Why not? Just a hunch. I can hear the scepticism already. "Nothing's free. There's a catch. Who are these people?" 

(Why only 50? We know we can support 50 churches without having to buy anything we don't already have, we're confident that we can support 500 next phase, and we need to learn how to do this for 50,000 if we have to!)

So if you want to get involved, what do you do?

You could like the Facebook page at (UK only, sorry!)
You could tweet using the hash tag #jdapYes (start at!/jdap/status/195479387192311810)

That will work whether you want to help or be helped.


You can now also let us know you want to take part by going to: