Florida Power and Light

Summary The deregulation of the energy industry has offered Florida Power and Light the opportunity to adjust its internal structure in an effort to provide better products and services to consumers. The adjustments and creation of different management programs have aided in guiding FPL from being a local utility company to a national energy services enterprise.

Analysis The energy industry is maybe one of the most stable industries in the market. Much like any other industry it has its strengths and weaknesses, but in terms of consumer demand it’s safe to say that the energy industry will be around for quite some time. If we look at technicalities it is also safe to say that energy resource refinement and utilization has been around since the beginning of time. The energy industry is one of enormous depth because of the many different resource types and respective uses. There are two more common sides of this industry; one could even imply these are the two main types, power and lighting as well as oil and gas. It is true that in many cases when we refer to oil and gas it is an industry in its own, much like power and lighting. However, when we understand all that is included in the energy industry we begin to realize and understand that the two latter industries are in essence offspring of the energy industry. Because electricity and fuel are created differently we separate the two and create industries specific to each. However, according to James Rickman, energy is “the basic element necessary for people to achieve economic recovery, R&D innovations and manufacturing growth. Its sources can be non-renewable fossil fuels including oil, coal, natural gas or renewable energy alternatives such as wind and hydro turbines, PV solar cells, and bio-fuel.” (Rickman) Another source put it simple by informing us that energy is, “the ability to do work” (Energy Quest), and is found in several forms including electrical energy and chemical energy. This is important because the steady growth of technology, industrial and information, and the growing need for finding or creating alternate power resources will create opportunities to take advantage of a significant portion of what energy offers.

Organizations such as Florida Power and Light (FPL) have experienced the possibilities available within this industry. They have also adjusted internally to changes in the industry, specifically deregulation. “For Florida Power and Light, deregulation will continue to be a major force in the organization’s evolution.” (reading) Their current strategy of dealing with deregulation is by measuring the problem and applying an appropriate solution from factual evidence, using the least amount of resources possible, and most importantly ensuring customer satisfaction at all times. “At Florida Power and Light, quality – as demonstrated through the company’s focus on multifunctional problem solving, fact-based, and a deep commitment to exemplary customer service – is part of the fabric of the enterprise.” (reading) Even before deregulation FPL, under new management, took initiative to improve their customer service, which is the center of their operations. FPL has worked to offer consumers with the best products and services at the right price, and will continue to shape their internal structure around the happiness of their customers. They can accomplish this in a number of ways, however FPL attends to customer satisfaction by ensuring efficiency at every level of the process, from idea to product. If at any moment during that process something falls out of line FPL employs multidisciplinary teams to reconfigure the entire organization. Multidisciplinary teams are effective in getting everyone involved and responsible for a certain portion of finding a solution. It not only gets everyone involved but it incorporates different sectional strengths or improvement needs. In just about every situation contained within this case resulted in a multidisciplinary team creation on the part of FPL. Although this works, they are reacting to changes in the market as opposed to making the changes and steadying the amount of competitors willing and able to compete. Along with the team the FPL seeks for internal ways to manage of change the situation as opposed to exhausting other resources. For instance when the VP built a replacement part for significantly cheaper than what they had been paying to purchase the replacement part from the supplier. When presented with these information suppliers are more willing to negotiate prices. FPL in this case has the opportunity to manufacture the parts for ¼ the price or continue to buy for the seller. Instead of choosing either option FPL offers the consumer the ability to go straight to the supplier. They also promote customer-based practices for thirds party vendors as well. Despite all that FPL does to continue competing in the market, the steady growth and need for technology and all other byproducts of energy resources will continue to demand change. The intensity of the market and wealth of competition will keep FPL from begin able to become the global market that they wish to be.
Recommendations
The reading offered a wealth of information on how FPL deals with the consistent change of their industry. Of all that they held as important the case repeatedly referred to the overall goal being customer satisfaction. FPL not only looks at them as a way to correct a situation. They also look to those they are affiliated with. For instance the example in the case about mentoring vendors on ways to satisfy customers and ensure earnings. By allowing the customer access to the suppliers vendors gave their customers alternate options. It is much like Center point being our main energy provider yet they give us other companies to choose from in order to have service. They are free to choose the company they desire. This gives consumers a sense of freedom, thud the reason I would recommend that they continue to mentor vendors, even those that are not eligible or do not meet company specific guidelines. By FPL encouraging the vendors to offer this option and it producing valued results by vendors it prompts them to keep the partnership in tact. Thus providing a great avenue for FPL to obtain and maintain relationships with vendors that will help continue to help them grow as competition takes advantage of deregulation. In terms of customer centric and market driven focus, I would suggest that they continue to work in the direction in which they are headed. For a company such as FPL that is quickly becoming a global enterprise it is challenging to see where they desire change. In respect to a customer centric and market driven focus, FPL’s main focus beginning after the 1980 vision change included and was centered on customer relationships and service to improve the image of the company in declining times. However, as the times have continued FPL continues to strive for customer satisfaction in other ways like keeping costs down. In order for the costs to remain competitive the expenses must remain at minimum. For an organization that is driven on customer satisfaction being market driven as well as researching and utilizing other avenues, such as the replacement part scenario. By seeking the lower rates and letting the benefits roll down to clients helps to secure loyal customer base as more competition is ushered in because of deregulation.

Implications I don’t believe the strategies and methods used by FPL need any changes as it has been working for the company for decades and continue to produce earnings. Even after the deregulation began in 1992 FPL was ready to battle to changes. It was less challenging to face changes that were forged because of law when it had already occurred from inside the organization. I would like to suggest that the programs be updated and integrated so that one system handles multiple facets efficiently. Currently a separate program accompanies each section that undergoes transformation. If the systems were combined it would cost the company less more to operate and maintain whatever programs are associated with each and are paying for the use and maintenance of one system. Looking towards the future I would say that the Florida Power and Light Company will be able to manage in a deregulated industry. The company has dealt with several historical storms and other hiccups that have attempted to prevent the growth of business. However, the continuous mindset of customer satisfaction coupled with low cost and quality services is the key to their success.

Reference:

Energy Quest. Chapter 1: Energy What is it? unk. 11 September 2011 .

Florida Power and Lights. History. unk. 19 10 2011 .

Rickman, James. James Rickman's Instablog. 30 December 2009. 19 September 2011 .