Not too long ago, the Energy Ombudsman published its 2025 figures. Of over 80,000 cases accepted by the Ombudsman (a 14% decrease on last year), almost 50% were signposted when issues remained unresolved.
Each Ombudsman referral is a missed opportunity to improve an end-to-end customer outcome and is a source of cash leaking from the business. This challenge represents a significant opportunity for suppliers to mitigate Ombudsman referrals by improving their operational performance.
To address this operational performance challenge, an important consideration is whether or not the time is right to re-evaluate your operating model as complaints rarely sit in isolation. Behind challenges such as this we typically find:
- Broken handoffs between teams
- Unclear accountability
- Poor visibility of performance issues
- Systems creating friction instead of flow
- Processes optimised in silos rather than around customer outcomes
- Transformation initiatives struggling to land sustainably
At the same time the questions asked change from “which process do we fix?” to “is our operating model helping or hurting our performance?”
With an average Ombudsman referral rate of 50%, the improvement opportunity is significant; but how do you know if an operating model change is the right step?
Operating model vs process change
A process initiative usually targets a specific issue or workflow.
An operating model change looks wider. It determines how effectively the organisation is set-up to deliver the customer, colleague and commercial outcomes it intends to, covering areas such as:
- Strategy & vision – which may cause challenges if it’s vague, overambitious, or if teams cannot understand how their work connects to the strategy
- Service Delivery – challenges are indicated if there are excessive hand-offs that create delays, or if getting partners to deliver the outcomes you expect feels tougher than it should
- Organisational design – May be a source of challenge if teams focus on tasks over outcome, or if you observe an ‘us and them’ mentality
- People – will be inhibiting performance if leaders are working on tasks rather than driving performance, or if there’s a gap in key capabilities
- Systems – Will be causing a challenge if expected data is unavailable or if processing work items requires significant manual effort or workarounds
- Governance – Will be a driver of operational challenge the organisation is focusing on strict control over improvement, or if key decisions take a long-time to reach
While targeted process fixes can resolve specific issues, broader performance is shaped by how these areas operate together. To inform decision making on whether it’s time to look at your operating model, you could consider the following questions:
- Where are you seeing issues appear across the organisation, are they concentrated, or do they show up across teams?
- How clear is ownership, do people know who is accountable?
- Do you know how much of leaders' time is spent firefighting versus driving longer-term improvement?
- When improvement initiatives are implemented, how well do the changes sustain and embed?
- How consistent are customer outcomes? Do you continue to see variation, even after process changes have been made?
If the problem is confined, owned and links to a specific cause, a process fix is usually enough.
However, if issues are spread across multiple areas, ownership is unclear and improvement efforts are not effective, the problem is likely structural pointing to the operating model. This is true whether the challenge is:
- System migrations and digital change
- AI and automation adoption
- Growth and scaling pressure
- Mergers and integrations
- Changing customer expectations
- Cost reduction and efficiency programmes
Ultimately your operating model is what determines whether change succeeds or stalls.
How can we help?
At BFY, we support utility companies in building pragmatic operating models considering both organisational reality and top-level strategic direction, and bringing these to fruition. We work alongside your teams to develop tailored operating models that bridge the gap between high-level strategy and daily execution.
Specifically, our team has extensive and recent experience transforming and working on operating models in major UK energy retailers.
If you’d like to explore how BFY can support you in identifying areas of focus and driving better an operating model transformation contact Josh or James.
