From siloed to streamlined:

How Southern Water transformed their regulatory reporting process to deliver agility and trust

Water and waste processing company covering Kent...

4,000,000 Customers

4,000 People

Southern Water is a water collection, treatment and supply company. They called on us to systemize and streamline the huge task of building regulatory reports for PR24.

Following our work together, Southern has an agile, streamlined setup that allowed them to produce a PR24 report they could stand behind.

PR24 Reporting

Regulator-supplied 150-tab spreadsheet with over 400,000 unique formulae. Over 30 years of data to model, forecast, scenario test, and reconcile.

BEFORE

AFTER

BEFORE

AFTER

BEFORE

AFTER

CHALLENGE

Southern Water is the water collection, treatment and supply company for Kent, Hampshire, the Isle of Wight, East and West Sussex. Like every UK water company, they are answerable to the regulator, Ofwat. The Price Review (PR) is Ofwat’s five-year assessment tool that keeps companies on track to deliver new initiatives and upgrades that make customers’ lives better.

As part of this review, Ofwat gathers a ton of data to benchmark companies against each other and their own past performance. From capital and operational expenditure to the impact of new projects on things like biodiversity, reducing leaks or avoiding pollution events. The data set spans the previous and the upcoming 5 years, as well as forecasting through to 2050. Any sign of incomplete reporting, inaccurate evidence, inefficient projects or duplicate plans could lead to price challenges or worse, a public enquiry. So it’s in Southern’s best interest to be as thorough and as accurate as possible.

Ofwat gathers this mass of data via spreadsheet, emailing a 150-tab document with 415,000 unique formulae to each water company. This is a mammoth task because:

The tabs are grouped but don’t share any data and there’s no built-in reconciliation.

Ofwat’s requirements change frequently to reflect the latest government guidelines, and local or world developments such as climate change, population migration and unplanned events.

For the team at Southern, the challenges didn’t stop there. They faced completing this sprawling report using:

Hundreds of heavily siloed and insufficiently integrated systems operated by almost 4000 team members across full time, contractors and partners.

Data that was hard to verify and virtually impossible to compare because of the myriad ways it had been benchmarked, filtered, amended and adjusted.

Data that lacked a clear origin. Tracing where a figure had come from was a time-consuming journey through layers of spreadsheets, reports, data extracts and emails…only to find the person producing it was sat a few desks away.

A setup that struggled to keep pace with the necessary data verification, back and forth, external consultation and moving parts involved in producing the final figures.

The stakes are sky-high to get this done thoroughly, accurately and on-time. If not, the company might lose funding for a crucial project or in the worst-case scenario, face a public enquiry.

VISION

The team at Southern wanted to:

Confidently submit an accurate PR24 report, securing support for much-needed network improvements to guarantee happy customers for years to come.

Streamline the report submission process, avoid repeating work and eliminate the risk of delivering conflicting or confusing numbers.

Make amendments and reprocessing quick and easy, with a system that tracks every change.

WHY NOW?

Despite months of work and significant investment in the process, Southern still had 2 databases that crashed constantly, took at least 6 hours to refresh, delivered numbers that didn’t add up and had no transparency or visibility. And the PowerBI dashboards developed for the programme were useless as they were reporting on flawed data.

With the first of many internal deadlines looming, Southern asked us to get the PR24 project back on track. The team needed a simple, lightweight system that would be easy to work with. A setup to help them navigate the many deadlines, sign-offs, moving parts and back and forth that pave the way for delivering the final figures on time and with confidence.

HOW WE DID IT

STEP ONE Risk-based review

We did a risk-based implementation review, helping to hold existing suppliers to account and reveal the extent of rework and remediation needed to get the project moving again.

STEP TWO Simplified data collection strategy

Working with Southern’s subject matter experts, we simplified the data collection process. We created a single, consistent format for business units to submit their data in. This streamlined approach meant the team could now keep up with the volume of data coming in. They now have the tools to review and replay figures from each business unit with ease.

STEP THREE Clarifying our goals

We called on the expertise of Mark Whitehorn, professor of analytics at Dundee University. He broke down the PR24 spreadsheet and consolidated the information it was asking for. It turns out many of those separate tabs needed the exact same data, just at a different level of aggregation or broken down by a different set of groupings.

We now had a more meaningful (and much smaller) data set to aim for. We reshaped how the data was organized to make it compatible with these requirements, while leaving space for those daily shifts and changes.

STEP FOUR Streamlining systems

With the output need firmly in our sights, we also considered the operational need of the new, streamlined approach.

By going from three systems to just one, we created a straightforward process where every number can be reconciled. The team can see every calculation, every step and every transformation applied. They can interact with the data: answering questions, resolving issues and demonstrating the impact of any change right away. Thanks to the system’s transparency, they can spot rule and reporting errors and correct them.

RESULT

The team at Southern gained confidence in and control of the numbers. Everyone can agree on and deliver figures that are comparable, transparent and visible at every level. Now, Southern Water are:

Rigorous Delivering a PR24 report the team can stand behind and that stands up to scrutiny. They can respond to questions from the regulator and give reasons for the numbers they’re presenting.

Agile Reprocessing data within an hour (not days) with no crashing. The teams can easily action changes and adjustments, while the system logs every step.

Transparent Relying on simple, traceable logic to find issues or spot differences and track them back to their origin. A process which used to take days.

Now, Southern Water can look forward to PR29 with confidence.

Outlier is a trusted partner because I know the team will get things over the line every time without fuss.

We approached Outlier for the PR24 systemisation because they’ve delivered to a high standard on other projects for us. As a trusted partner, we knew they could give us unbiased insights on what was needed to deliver PR24.

As expected, the team’s work was methodical, risk-based and impartial. Theygathered the right team of experts and genuinely partnered with our internal teams to weed through countless layers of data and systems to streamline our processes.

Ultimately, they delivered something straightforward and functional that the team could actually work with.

For me, knowing that I had Outlier on the case gave me one less thing to worry about in a sea of high-priority projects. I know that David and the team will get things over the line every time without fail. They’re a safe pair of hands whom I trust absolutely to deliver with no fuss.”