Rob Stait, Head
of Business
Development and
Marketing, Echo
Managed Services
Walsall, U.K. --- (METERING.COM) --- February 1, 2011 - The U.K.’s water companies will need to look at new ways of procuring technology and the functionality and innovations they need, such as cloud computing and software as a service, according to a new study from Echo Managed Services.

The reason is that half of the systems that manage the billing and customer care needs of the U.K.’s water companies will not be ready to meet the requirements of the next five years. Further, uncertainty from Ofwat and the government, coupled with a challenging price determination, is preventing water companies from investing in new technology.

The research found that of most immediate concern, customer billing systems are not up to the job when it comes to the new customer satisfaction reporting requirements (known as SIM), with 70 percent needing changes. However, despite recognizing the limitations of their systems, only three of the 14 companies interviewed were looking to change systems during the next five-year investment cycle.

Echo’s head of business development and marketing, Rob Stait, believes there are several reasons for this, of which the main one is cost.

“What we’ve also seen in the responses is that there’s a lot of uncertainty around the direction the government will take in expanding the scope of commercial competition and what the final requirements for SIM will be. Compounding this uncertainty is government’s review of Ofwat itself and the likelihood of a new national Water Bill and all the changes that this is likely to bring. As a result, water companies have more cause to hesitate, delaying investments in system improvements and enhancements.”

To address the functional gaps, most water companies are looking to make investment in their existing systems, the study found.

The study also found a wide disparity of approaches to areas such as metering technology. In Ofwat’s final determination of prices for the next cycle it put pressure on water companies to deliver more efficient service operations, but several companies believe it has stopped short of allowing funds for the technology innovations which they believe could potentially deliver such efficiencies.

AMR and smart metering are areas highlighted by the research where the level of funding is particularly contentious, with a difference between the approaches of the small and the large water companies. While the larger companies have been able to protect investment in exploration of the more advanced smart metering technology, smaller companies, with more limited resources, are having to prioritise their investment differently and limit funding to the more basic advances in metering. In some cases, the smaller companies are dismissing any opportunity to invest in innovation, preferring instead to rely on manual processes.

As the U.K. water industry navigates the customer service challenges, uncertainty and lack of resources could lead to some companies being left behind. Echo believes that one solution to tackling these challenges could be to explore alternative procurement models such as SaaS and cloud computing.

Many of the new requirements are increasingly lending themselves to web based additions to existing systems that do not necessarily need to be integrated and installed as part of the central solution. Over the next couple of years even core functionality, such as billing calculations or debt recovery, may be available online and on a transactional basis.