Friday, February 17, 2017

Branding Update
February 8, 2017

Fake News

It's debatable whether the internet was designed to enable the free flow of truthful and useful information, but it's safe to say that this should be our desire. However, it's very clear that the internet has increased the power of divisive speech, hyperbole, and false information. Debating the internet's benefits and drawbacks will continue for quite some time, maybe for as long as humans exist. So, we won't tackle the broader question here, but we should respond to the rise of "fake news."

The Lure of Fabricated Facts - It's very difficult for well-researched information to compete with fiction, because fiction can always be fabricated to be more eye catching, more polarizing, and more effective in playing on our fears and advancing a specific agenda. And what may even be more disturbing is that some people are applying the term fake news to information simply because it doesn't align with their own beliefs or ideologies. In other words, if I don't agree, it must be false. This behavior is troubling independent of a person's ideological or political leanings.

Utilities Combating Erroneous Information - Utilities have been dealing with inaccurate information for quite some time, often presented by gadflies and opponents during public-policy meetings. Unfortunately, the squeaky wheels affect policy decisions more often than utility managers like to admit. During our work with utilities on branding, we have learned that part of the problem is how difficult it is for utilities to get people's attention and create transparency.

The Transparency Gap - Even though utilities provide quite a bit of information, and utility managers make every effort to ensure their facts are correct, it is still difficult and time consuming for people to evaluate the utility's decisions and accomplishments. This means that most people, including elected officials and influential community leaders, have not formulated an accurate opinion of the utility's performance. This state-of-affairs allows faulty facts and ideologies to gain traction. Furthermore, recent trends related to fake news may embolden those who have no interest in facts and wish only to advance preconceived notions about the effectiveness and efficiency of public agencies.

Creating Unassailable Content - Although branding is often categorized as spin, great brands provide compelling value to their customers. And the branding tactics being advanced by Resource Trends and the Utility Branding Network are designed to reduce confusion and increase transparency. The foundation for these tactics is providing superior customer service, and realizing that customers are also shareholders and investors in the utility's resources and infrastructure. Treating audiences like shareholders involves communicating the utility's standards, producing compelling arguments for investment, and creating content that makes it easy for community leaders to be informed. Although no information is completely indisputable, we undeniably live in world where it makes sense to do a better job of being factual, clear, and compelling.

Tuesday, January 3, 2017

Branding Update
December 15, 2016

Year-End Reflections

At the end of the year it helps to reflect on learning and accomplishments, and 2016 was a banner year for both.

The Central Role of Standards -We continue to witness the power of standards in helping utilities enhance planning, deliver compelling value, and increase transparency. We learned to fully appreciate that the essence of a brand is its standards, which define and operationalize the product's value or service experience. And if you want employees to be empowered and embrace the brand, emphasize standards in your internal dialogue and decision-making processes.

An Unbalanced Dialogue - From the beginning, the utility-branding objective has been to secure appropriate investment in resources and infrastructure. We always understood that investment decisions occur in a political environment. What has become increasingly clear is that most utilities engage in an unbalanced dialogue during the approval process for rate increases or major investments. This is because most community leaders, let alone the public, are not plugged-in to the utility's activities, decisions, and accomplishments. This means that the dialogue about rates and investment occurs between a small group of people, typically the utility's staff, policy makers, and members of the public who choose to be engaged. The people who do show up deserve to be heard, but their interests should not be given undue consideration. Unfortunately, absent more community leaders being involved, the squeaky wheels often influence policy.

Reaching the Influential Public - Several utilities are balancing the dialogue by launching communication programs designed to build relationships with community leaders. These programs make it easy to be informed (requiring only 2-3 minutes per month of their time). The marquee content featured in these information briefs does not attempt to "dumb down" technical information, but treats the audience like investors and shareholders. A great example is the DSRSDtoday program being implemented by Dublin San Ramon Services District.

Compelling Arguments for Investment - The Utility Branding Network tool "Making a Compelling Argument for Investment" continues to be well received. The tool is being used for investment proposals in Board Packets, describing major objectives in strategic plans, and for leading a dialogue with the public about investments in resources and infrastructure. Click here to view the tool.

General Manager Forums and Workshops - Helping utility GM's engage in the branding process has been a long-time goal of the Utility Branding Network, and 2016 was a banner year for progress. We held two GM Forums in Southern California and one in the San Francisco Bay Area. The Branding Network also held its first workshop in the Bay Area for staff and managers, sponsored by Santa Clara Valley Water District (held at their Silicon Valley Water Purification Center).
Thanks to those utilities who are supporting the Utility Branding Network, and thanks again to the National Water Research Institute (NWRI) for sponsoring the Network. I look forward to even greater progress and learning in 2017.

Have a Happy Holiday Season!

John Ruetten - Resource Trends, Inc.

Monday, September 26, 2016

Branding Update
September 26, 2016 

Supply Reliability Standards 

Water-supply reliability is essential for a strong economy and quality of life. Consequently, our tolerance for sustained water shortages should be extremely low. Framing reliability in terms of risk tolerance helps us reinforce that water-supply planning is a risk-management problem. There are several important topics to consider when communicating about reliability. These topics include defining clear standards, the role that climate change plays in the dialogue, and in some regions whether we are reaching "drought fatigue" with the public. This Branding Update addresses supply-reliability standards.

Adopting a Very Specific Standard - If we are going to have a meaningful discussion about reliability, and increase our chances of securing appropriate investment in water resources, then we need to describe reliability. One way to do this is to adopt a specific reliability standard, for example water restrictions occurring in no more than one in ten years. In this context, we are defining restrictions as requiring the customer to go beyond water efficiency. Being this explicit does not imply that we can precisely calculate what is required to meet this standard. However, it can enhance our thinking about the efficacy of a standard, needed investments, and compliance. For example, we can argue that the public would view allowing water restrictions every 3-5 years as substandard, whereas restrictions occurring in one out of every 20 years is overkill (and too costly). Hence, we can almost intuitively hone in on the ten-year standard. 

The Value of Being Clear - Having a specific standard in place enhances our ability to evaluate potential investments, and assess the probability that we will succeed or fail. For example, a utility's recommended supply investments might be very different if the standard allowed restrictions every third year, instead of every tenth year. And given a ten-year standard, we can unambiguously state that restrictions occurring every 4 or 5 years is a failure. It's hard to ascertain today what water utilities consider to be a reliability failure. Are we already experiencing failure? Are we actually leading a public dialogue that defines success and addresses the risks in a meaningful way? And how long will we be able to blame drought for what appears to be increasing water restrictions?

The Power of Standards - As we have discussed in previous Branding Updates, communicating specific standards is a powerful way to describe value, state a problem, and increase our chances of securing needed investment.

Thursday, July 14, 2016

Branding Update
July 14. 2016 

Utility Branding Network

Hope you all had a great 4th of July holiday. Many of you may know that several years ago we formed the Utility Branding Network (UBN). The purpose of the UBN is to advance best practices in utility branding, provide a vehicle for member utilities to share progress and case studies, and ultimately increase investment in water resources and infrastructure. The Utility Branding Network is sponsored by the National Water Research Institute (NWRI). 

General Manager Forums - In addition to our bi-annual workshops for staff and managers, we recently held our first official GM Forum. These meetings allow water and wastewater GM's to come together and discuss progress on utility branding, and topics of their own choosing. GM's from 7 leading utilities in Southern California attended this inaugural meeting, and discussion topics included rate-increase communications, the influence of customers on policy decisions, how policy makers perceive their roles in representing the public, and the benefits of a formal strategic plan.

Upcoming Events - Our next GM forum will be held in the San Francisco bay area on August 2, and the next Branding Network Workshop will be held at Orange County Water District on August 22.

Making a Compelling Argument for Investment - This recently released UBN tool outlines the structure for making a compelling argument for investment, and explains the logic behind this structure. To receive a copy of the tool, or learn more about the Branding Network, contact John Ruetten.

Wednesday, April 13, 2016

Branding Update
April 13, 2016

The Power of Standards

They Define the Brand - In previous Branding Updates, we have discussed the role of standards in defining and communicating value, being transparent, and building a strong brand. In fact, standards are the essence of a brand, whether they specify product features or aspects of the service experience. However, it is easy to overlook the benefits that focusing on standards can bring to an organization. 

They Affect Culture - Standards affect culture if they are used to articulate desired employee behaviors, for example caring about the customer, being collaborative, or proactively solving problems.

They Empower and Unify Employees - When standards are clear and widely communicated, employees are empowered to make good decisions on their own. In this vein, standards of reliability and quality can be a unifying force for employees, providing the foundation for every conversation about future plans, activities, and decisions. Whenever there is confusion or a debate, reviewing the relevant standards is always clarifying. Employees should be proud of the standards that govern the quality of service delivered to customers.

Try this Exercise: Think of a brand that you like and then try defining the features of the product, or characteristics of the service, that make you a loyal customer. You will find that you are describing standards. And then ask yourself how important it would be for employees to be very aware of these standards and how they affect the brand's success.

Tuesday, March 8, 2016

Branding Update
March 8, 2016

Transparency in Salaries and Compensation

Utility managers often grapple with being transparent about salaries and compensation. Transparency in public agencies is mandatory because they are typically monopolies and chartered with protecting the public interest. But crafting a successful approach to transparency in the area of compensation requires a clear understanding of what influences people’s thinking about utilities and public-employees.

The Relevant Issues

Customer Choice and Competition – In most cases, utility customers cannot choose another service provider, so they clearly deserve to know whether the utility is well run and the public interest is being served. This no-choice circumstance is married to the idea that utilities have “no competitors,” which for some means that they are less efficient. Whether competition actually leads to greater efficiency is debatable, but it probably doesn’t matter. The inefficient government bias is actively reinforced in politics and the media.

The Brand of Public Employees – Lack of competition and the inefficiency brand can lead to perceptions that public employees are less qualified, less motivated, or underperform those who work in the private sector. This undeniably affects opinions about compensation.

The Efficiency Enigma and Investment – Despite the need for utilities to be efficient and build a reputation for efficiency, the efficiency issue is actually a red herring when contemplating the need to invest in water resources and infrastructure. The potential to increase efficiency, even in an “inefficient” organization, may only be a 10% opportunity. The real question is whether inefficiency is used as an excuse to oppose rate increases, leading to under-investment. Since reliable water services are essential for a strong economy and quality of life, system failures or resource shortages can cost the community many times more than the entire operating budget of the utility. This means that policy makers should be less focused on efficiency and more concerned about the liabilities that arise from under-investment. The people of Flint Michigan are experiencing these liabilities today.

Appropriate Investment Begins with the Employees – In order to adequately serve the public interest, utilities must invest in a management team and employees that are highly qualified and well trained, especially in the areas of planning, technology, and finances. People may believe that a utility general manager making $250,000 per year is overpaid. However, even skeptics might think differently when they realize that the performance of the utility affects the viability of hundreds of companies which employ thousands of people.  Clearly, dollars invested in water utilities are highly leveraged dollars.

A Strategy

Be Very Transparent – Utilities should make it very easy for people to get access to information on salaries and compensation. But this transparency should be enhanced by providing a meaningful context for evaluating this compensation.

Create a Compensation Strategy Brief – An ongoing effort to build a strong brand with policy makers and the influential public certainly helps to alleviate concerns about employee compensation. More specifically, the utility can create a brief that outlines the thinking behind the utility’s compensation strategy. This brief should highlight the utility’s fundamental role in maintaining the local environment, quality of life, and economy. It should also communicate key workforce standards, the commitment to sound planning and efficient operations, and the need for compensation that will attract and retain quality employees.

Don’t Be Apologetic – Utilities need strong leaders who are committed to protecting the public interest, securing investment, and delivering high standards of service. If challenged, emphasize your workforce standards and stand behind your compensation strategy. 

Tuesday, February 9, 2016

Branding Update
February 9, 2016

Actually Connecting with Key Audiences

Previous Branding Updates have proposed that the objective of utility branding is to protect the public's interest by securing appropriate investment in resources and infrastructure. No one wants to endure the consequences of low trust and under-investment, namely reduced reliability and degraded service. The primary audiences for ensuring that appropriate investment occurs are policy makers and those in a position to influence policy decisions. We have referred to this latter group as the influential public, and also discussed the high-quality information required to attract and keep their attention.

Delivering Marquee Content, Building Relationships - A great example of making it easy for the influential public to have their "finger on the pulse" of the utility is being implemented by Dublin San Ramon Services District (DSRSD), located in Dublin, California. Their DSRSD Today program delivers very brief articles, 3-4 times per month, to their Board of Directors, elected officials, and other community leaders. These stories meet specific content and formatting standards. For example, they take less than a minute to read, and headlines typically connect an action or investment with a beneficial result. In general, DSRSD Today installments focus on return-on-investment, efficiency, financial management, and important policy decisions. These topics are relevant to customers and the community, and effective in building a strong utility brand.

Recent installments of DSRSD Today are posted at

Increasing Transparency - By spending less than 5 minutes per month reading DSRSD Today articles, community leaders find out what they need to know about the utility's activities, decisions, and performance. Furthermore, policy makers know who is paying attention and what information they have received. These efforts significantly increase transparency, which is not only appropriate, but in itself a great way to build trust and a strong brand.