When you lead one of the world’s largest electric utilities, you deal with a rather interesting set of challenges. For example:
A large percentage of your workforce is nearing retirement, yet your industry does not seem to hold the attractiveness of the dynamic technology companies you must compete with for young talent.
You manage stakeholders who often have opposing interests, which means whatever you do to satisfy one risks alienating another.
After decades of stability and uniformity, your customers’ expectations for service, choice, and customization have dramatically transformed and diverged.
Your industry is exposed to changes in public policies that are under continual debate — at the local, national, and global level.
And while nature is literally the source of your power, it can also be your most vicious enemy, especially when huge swaths of your customers live in hurricane zones like the Carolinas and Florida.
Meet Lynn J. Good, chairman, president, and CEO of Charlotte, North Carolina-based Duke Energy Corp. Good, whose calm and upbeat demeanor belies the very long set of complex tensions she faces every day, met with MIT Sloan Management Review editor in chief Paul Michelman at Duke’s headquarters in Charlotte, with further exchanges via email. What follows is a condensed and edited version of their conversation about leadership, strategy, and an industry undergoing dramatic transformation.
MIT Sloan Management Review: The first topic I’d like to cover is industry transformation and the nature of competition. You wrote recently that the transformational change the electric industry is undergoing “is surprisingly intense.” What are the key drivers of this surprisingly intense transformation?
Good: I point to three things: customer expectations, technology, and public policy. What’s surprising is that all three of them are changing at the same time. To have rapid advancement on three distinct dimensions simultaneously makes for an extraordinary transformation.
Let’s look at how our customer relationships have evolved. And to do that, we have to look at where our industry has come from. We are engineers who built big networks. We manage assets. We maintain the reliability of those assets. Our traditional focus was on the network, not the customer.