During the early part of 2012, the company continued to evolve its structure and operating model while seeking to influence the RWE Group debate relating to wider group strategy and structure.
The challenges faced at a group level resulted in a fundamental change in approach for the company, which ultimately led to the generation business being steered at a European level and the retail business reorganising to a business segment model. The functional activities continued to be provided to both businesses pending further development of a group-wide approach in this area.
Although the changes to the generation and retail businesses did not take effect until 1 January 2013, a significant amount of work was undertaken during the second half of 2012 to ensure that the new structure would be in place by that time.
Within retail, a key focus of 2012 has been the transformational change necessary to achieve our ambition to be number one in customer experience by 2015. This has involved creating a business strategy and change priorities which can enable the delivery of this in the next two to three years. The transformation programme focuses on putting the voice of the customer at the heart of our business, reviewing and improving our end-to-end customer journeys, driving operating excellence and the introduction of ‘npower ways of working’ at all levels of the business.
During this programme of large-scale change, we have remained committed to building the business capabilities and core skills which will enable us to deliver our objectives and investment plans. We have highlighted change leadership as a key capability to work on in 2013 and have started work on this in 2012, including a leadership capability review.
We have also developed and piloted new performance management and accompanying reward systems to help create a high-performing, customer-orientated culture and will be looking to roll-out these systems during 2013 to enable further the overall programme of change.
Large Combustion Plant Directive impact
We have continued to engage with our employees at our four ‘opted-out’ power station sites, which are due to close by 2015 in response to the European Union’s Large Combustion Plant Directive. In March 2013, two of those stations ceased generation and formally closed, following an extensive period of retraining and outplacement support for staff, to assist them with being redeployed both within the industry and the local community.
The remaining two stations will close by 2015 and we continue to work with those employees affected to help them plan for their future. We have set out in broad terms the severance terms and training and redeployment opportunities which will be made available.
The total impact of these closures could result in the possible loss of about 700 employees through to 2015.
Employee motivation and retention
Given the challenges outlined above and the continuing economic, political and regulatory climate, 2012 was another challenging time for our people. Throughout this period, however, the company has sought to ensure that it treats its employees with respect and that they have all the information they need to enable them to evaluate options and make the most of opportunities available.
It remains critical that as a company, we retain the core skills which are required to deliver our objectives and future investment plans in this challenging environment. The company therefore continues to evaluate its systems and processes to ensure that there is a direct link between the performance of the business and the rewards offered to employees.
As a result of the Pulse survey in 2012, our people told us that we needed to continue to focus on four key areas that we call Leading Indicators of Change – Leadership, People Development, Communications and Customer Focus.
We are also focusing on ways to increase the visibility of our leadership team while they articulate the strategy and provide role-modelling of the Critical Behaviours.
In terms of performance management, our people are keen to ensure we have a fair and consistent approach and offer a wide range of development options to support succession and talent management. Change capability is also key to the success of large-scale transformational activity.
When it comes to communication, our people are keen to improve their understanding of their role in delivering the strategy and in communicating more effectively across the wider organisation using numerous channels.
Finally, customer focus is at the heart of the business, with our customer transformation programme ensuring we put the customer at the heart of everything we do.