Bridging the Digital Divide: 5 Obstacles Blocking Utility CX Transformation

In today’s connected world, customers expect their utility to be as responsive and intuitive as their favorite consumer apps. Yet, many utilities lag, challenged by outdated systems, siloed data, and rising customer frustration As rates increase, so do customer digital demands. In fact, 69% of utility customers expect fluid interactions across multiple channels and proactive communication; a figure that underscores the growing reliance on technology for self-management and monitoring [1]. However, only a fraction of utilities are delivering on these expectations.  

What’s holding them back, and how can they leap forward?

1. Legacy Systems & Siloed Data 

Many utilities still operate on aging customer service and billing (CIS), workforce management, and CRM platforms that were never designed for today’s digital-first customer expectations. These legacy systems often require manual workarounds, limiting the ability to deliver real-time updates or support dynamic interactions. As a result, critical customer data usually remains locked in disconnected silos. This affects omnichannel service, delays responses, hinders Artificial Intelligence integration, and renders personalization nearly impossible, ultimately undermining trust and brand perception.  

2. Digital Channel Gaps 

The value of a lost customer requires the acquisition of three new customers to compensate, which confirms the importance of significant Customer Experience (CX). For reference, a telecommunications operator resolved its customers’ pain points by transitioning to more proactive communication and frictionless service, reducing its customer churn rate by 75%. However, many utilities still lack these capabilities. Industry surveys confirm that less than half of utilities provide real-time outage communications or allow customers to manage their accounts fully online. Without robust digital channels, utilities risk diminishing engagement and alienating digitally savvy consumers.     

3. Rising Costs, Shrinking Satisfaction 

As utility rates continue to rise, driven by inflation, infrastructure upgrades, and energy transition efforts, customers are growing more sensitive to the value they receive. When higher bills don’t improve service quality or communication, dissatisfaction rises quickly. This demand is reflected across all markets. For example, Gartner® reveals a clear gap in the perceived quality and trust in new CX technologies. Although companies are investing in GenAI to automate service, only 35% of customers who contacted by phone in their last service interaction are willing to try a GenAI digital assistant if available. This disconnection accentuates the dissatisfaction of customers with lower technology performance. Enhancing digital services, offering proactive communication, and simplifying billing demonstrate value and keep customer sentiment positive. 

4. Talent & Cultural Barriers 

CX transformation requires more than technology; it demands a shift in mindset, structure, and skills. Many utilities struggle to attract or retain digital talent with the experience needed to design and implement modern CX strategies. Additionally, internal resistance to change can be deeply rooted in long-standing operational models. Empowering employees with training, cross-functional collaboration, and clear cx ownership can drive meaningful progress. 

5. Regulatory & Vulnerable Customer Mandates 

Utilities are under increasing pressure to meet regulaUtilities are under increasing pressure to meet regulatory requirements while ensuring equitable service to vulnerable customers. This includes offering flexible payment arrangements, multilingual support, and proactive communication around service interruptions or billing changes. Without the right digital tools and automation, utilities risk falling short of both regulatory standards and customer needs, potentially incurring penalties and damaging public trust. tory requirements while ensuring equitable service to vulnerable customers. This includes offering flexible payment arrangements, multilingual support, and proactive communication around service interruptions or billing changes. Without the right digital tools and automation, utilities risk falling short of both regulatory standards and customer needs, potentially incurring penalties and damaging public trust. 

Bridging the Gap  

To overcome these challenges, utilities must focus on developing a customer-centric vision and a unified, future-ready digital ecosystem that streamlines applications and processes, rather than introducing standalone systems. This CX-focused platform should deliver: