The utility company is stemming the loss of customers with price cuts and a new focus on service and patriotism

It is a meeting that promises to mark a turning point in the future and fortunes of British Gas. On one side will be the board of Centrica, British Gas’s parent company; on the other Phil Bentley, the new managing director of Britain’s biggest energy supplier. In the background, perhaps, a faint, distant roar of disgruntled customers, jamming the phone lines with their complaints.

On the table next month will be Mr Bentley’s four-point plan for a transformation of British Gas in terms of customer service, pricing, culture and its standing in the industry. Not so much a statement of intent as a battle plan, backed up by some clear, unequivocal fighting talk.

“I’ll be going to the board saying here’s my team, this is the journey we will be on, judge us on these terms,” Mr Bentley says. “This is how we are going to go for market share, run our pricing, run our costs and organise ourselves differently.

“If we do a crap job, then OK, get rid of us, but let us get on and run British Gas along these lines.”

These lines include more staff on the “front line”, raids on his rivals’ regional strongholds in the battle for gas and electricity customers and the British Gas name replacing Centrica’s own on wind farms, storage tanks and North Sea platforms as the company plays the patriotic card against its foreign-owned competitors.

Mr Bentley has already been dubbed “whirlwind” by colleagues in Centrica’s plush Windsor headquarters. Once sitting down for this interview, the 48-year-old Yorkshireman expresses his every thought on the business and the competition and readily admits the areas in which British Gas has let down some of its 17 million customers. When it is over, his next audience is already waiting outside, ready for instructions.

Every hour Mr Bentley gets an update on his BlackBerry, detailing the average response times in British Gas call centres around the country. If the figures are not what he wants to hear, he says, “I’ll be on the phone wanting to know why”.

Part of his enthusiasm can be explained by the six-month wait that he had between the announcement of his appointment and the date that he took up the post. Centrica revealed that Mark Clare, his predecessor, was off to run Barratt Developments, the FTSE 250 housebuilder, in July last year. Mr Bentley was named as his replacement in September, but he had to continue to run the group corporate finance function until his own successor was ready to take over in March.

His first eight weeks have been a baptism of fire. After sparking a price war with the first cuts to gas and electricity bills in the industry for six years, Mr Bentley learnt just how much of the change he implements at British Gas will be carried out in the public eye.

Figures last month from Energywatch, the consumer watchdog, revealed that the number of complaints about British Gas had more than trebled to a record 21,427 in the past year. It made front-page news and the unsuspecting Mr Bentley was called on to the Today programme and hauled in front the cameras at Sky and the BBC to explain why so many customers were either getting inaccurate bills or nothing at all.

He admitted that a new £400 million billing system introduced last summer had suffered “teething problems”.

His suspicion of the media deepened last week when the scandal surrounding his former boss, Lord Browne of Madingley, first broke. Mr Bentley spent 15 years at BP up until 1997 and knows Tony Hayward, the new chief executive, well enough to have sent him a good luck message.

“I think it’s a tragedy for John Browne,” he says. “He delivered so much value for so many years and has been second to none as a leader. He took BP to the premier league. For him to be judged on what happened is a shame on the British press.”

However, Mr Bentley is wise enough to know that he will need them on his side as he tries to improve British Gas’s image.

Nearly three million customers left British Gas between 2004 and 2007 as soaring wholesale gas prices pushed energy bills to record highs. Before prices started to come down in March, the average British Gas dual-fuel customer was paying £1,120 a year to heat their home and cook – the most in the UK.

The new billing system was introduced just before British Gas waved through its second price rise of 2006 in September.

Mr Bentley puts the slew of problems since down to the huge job of loading up data from a host of ageing technologies that dated back to the days before British Gas was privatised under Margaret Thatcher with the memorable “Tell Sid” campaign.

“Picture data whistling down a pipeline,” Mr Bentley says. “If it’s not a perfect fit, it rattles around and gets chucked out.

“It’s exceptions like this that can cause customers not to get a bill or not get a cheque when they’re due to get a refund. But when these happen we fix it and gradually these kinks are being ironed out.

“We have to give great customer service. We have fallen from top to the bottom in the past 15 to 16 months and my top priority is getting us back to No 1.”

Other issues have been more cultural, such as customer service staff “handing off” callers to other departments because they were not trained for specific tasks. They were also set targets to deal with customers in as short a space of time as possible. They are now fully trained and are told to wait on a call until they solve the problem.

Mr Bentley says: “The culture here was command and control, slightly old-fashioned.

We need to empower staff, give them accountability.”

One advantage that the new system gives British Gas is the ability to implement new prices as quickly as a week, as opposed to three months. This was evident with two price cuts this year, which have resulted in British Gas’s average bill coming down by more than £200 and put intense pressure on its rivals to follow suit.

Suddenly the economics of the market are moving in the company’s favour. Its power stations are gas-fired so that, as the wholesale price has come down, so has its costs.

Mr Bentley argues that as prices for the coal burnt at power stations run by rivals such as npower, EDF and Powergen have remained stable, the price difference they have enjoyed is being eroded. He says: “They have been making out like bandits for the past two years. But we are leading the market down now and, if wholesale prices continue to soften, we will be out of the traps and passing that reduction to customers again.”

The first signs of the recovery that Mr Bentley wants came last week when the company enjoyed its first two consecutive months of customer additions for four years.

“One swallow doesn’t make a summer, but we are stemming the losses,” he says. “We are starting to grow again.

Sources: http://business.timesonline.co.uk

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