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Recognizing the need for change: Restructuring TNB Retail

Following this analysis, TNB decided to restructure its retail arm (TNB Retail), which would enable the business to focus on better engaging with its customers, develop new digital solutions, become more agile, and support the delivery of its big renewables ambition.

To do so successfully, TNB Retail decided to work with a partner on this transformation journey. TNB Retail began to seek an external partner to not only help it deliver its objectives at speed, but to provide a critical external perspective, and the competences to help the organization enhance its internal capabilities.

Following discussions with the local Malaysian EY team and a visit to meet some EY Power and Utilities clients and professionals based in the UK, TNB Retail chose EY as its transformation partner. As TNB’s Chief Retail Officer, Datuk Ir. Megat Jalaluddin Megat Hassan, explains, “We learned that the EY organization has a strong professional team in the utility sector with experiences in working with the top European utilities. We knew they would understand our challenges since we could speak the same language. We really wanted a partner who would share in-depth insights into developing a practical operating model for the Malaysian market, and work with us to co-create the best solution for TNB Retail, our people and our customers.”

Other factors in the decision included a commitment to bring global capabilities and experience to TNB, including the transfer of people to EY ASEAN to build a dedicated local Power and Utilities team, along with an ability to collaborate with other energy companies in the transformation of the retail business.

As a joint transformation team, TNB Retail and EY focused on three immediate priorities:

• Humans at center: Create a customer-led retail business and structure, while transforming TNB Retail employees into an agile-driven workforce and providing employees the opportunities and skills needed to make the business more customer-centric going forward.
• Innovation at scale: Create a retail business, structure and culture which enabled customers to better understand and manage their energy usage.
• Technology at speed: Establish a solutions business based on data to drive CX-led innovation and new business models in adjacent markets including electric vehicle (EV), solar, and connected homes.

The EY team’s experience in learning and development has helped to develop TNB Retail’s future workforce, through the establishment of The Retail Academy.  The Academy uses a mix of formal and experiential learning through exercises and projects to build employees’ skillsets. This includes skills for roles such as service designers, product owners, data scientists, and front-line workers, with a strong focus on customer experience. The Academy has helped TNB Retail unite its people around a common purpose: to deliver customers a truly world-class experience.

TNB Retail has also embarked on a transformative program to reinvent how its people work together. A “network of teams” model was designed by EY to build on the key principles of customer centricity, accountability and empowerment, all while working as a team.

This new way of working removes a typical top-down management style, enabling employees to deliver faster, better and more effective results for both customers and the business as a whole. As a completely new initiative, this is being piloted across TNB Retail’s customer-facing business in 2021.

Notable achievements of the transformation include:

• The establishment of a new customer-led retail division comprising over 4.5k employees.
• Segmentation of 9.4 million customers, enabling TNB Retail to better meet their needs.
• Delivery of new digital experiences to customers, with over 1 million customers now benefiting from smart meters in their homes, and more than 4.8 million of TNB's customers registered and using myTNB app.
• A growing solutions business, incubating multiple beyond kWh solutions within its innovation hub such as solar, electric vehicles and energy efficiency.
• The establishment of the Retail Academy, where more than 1.3k employees are benefitting from their first learning journey.
• The introduction of a new agile way of working that facilitates quicker responses to ever changing customer needs.

The benefits of TNB Retail’s transformation were immediately evident when COVID-19 hit. As Datuk Megat explains: “The strategies and methodologies proposed by EY proved to be providential when the COVID-19 pandemic reached Malaysia’s shores and impacted our day-to-day business. Valuable customer insights were gained during the height of the pandemic, which influenced our plans to further enhance our processes, systems, structure and people, while ensuring there was no disruption to our daily operations.”

Many customers with smart meters benefited from clearer information on their energy consumption and usage, and others were able to pay their bills easily through the app. Usage of the myTNB app almost tripled during the pandemic, confirming the value customers placed on these digitalization efforts.

Employees also appreciated the special support that was put in place to check on their health and well-being over this challenging time. During the national Movement Control Order in March 2020, EY leveraged its strategic partnership with SAP and Qualtrics to design and implement a health check survey for TNB Retail employees.

“We are very appreciative of EY’s strong collaborative spirit in helping to co-create our retail strategy and operating model,” says Datuk Megat. “The EY project team has promptly responded to our needs and provided practical, yet innovative solutions and options to address any issues raised. We are thankful of the team’s willingness to go the extra mile and assist us on our transformation journey. The co-creation exercise with our employees provided opportunities for everyone to feel that they owned the transformation and raised their commitment and engagement levels throughout the journey. Our TNB staff were also able to expand their capabilities via knowledge-sharing sessions during this project with EY.”

“We work on the basis of action and take a long-term view to support TNB Retail, and in doing so we build trust. It is great to be able to bring capabilities from across the firm and sector knowledge from around the world to positively impact a client’s journey,” says Philip Rao, EY Global Client Service Leader for TNB.

The company is now positioned to help Malaysia tap its abundant renewable energy sources and improve its portfolio of renewable energy and smart energy solutions, which will provide lasting benefits to Malaysians. The EY organization continues to play a crucial part in this ambition by enabling TNB Retail to become a successful, sustainable retail energy provider.