East Midlands Electricity Case Study

Reproduced from the ITelligence website
Copyright ©Reed Business Information 1998. 

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No substitute for experience in electricity giant's IT department
East Midlands Electricity needed to recruit IT staff quickly to ready the company for open competition. A dedicated IS recruitment manager and preferred partner agreements with agencies produced positive results

Company: East Midlands Electricity (now Powergen)
Business: The provision of electricity to a core franchise area of 2.2 million customers.
Head office: Nottingham
Operating profit: £181.1m (1997)

• Appointed experienced IS recruitment manager from a resource management consultancy to satisfy IS recruitment needs, in a competitive and fast-changing market. 
• Using more than one agency to promote competition. 
• Working closely with agencies to ensure they understand how to represent the company in a positive way. 
• Adopting business-like approach - decent notification period of start-date for contractors, making firm offers, and being clear about when and if contracts will be extended.

The deregulation of the UK's domestic electricity and gas supply market in 1998, and an increase in workload generally, prompted a review of East Midlands Electricity's IT strategy in the mid-90s. 

In particular, EME wanted to take direct control of all business-related IT projects - it had outsourced its IT operations to Perot Systems Europe (PSE) in 1992 - but lacked the in-house planning and technical skills to do it.

In 1997, the energy giant appointed an experienced IS resource manager from Barclay Anderson; Callum McCormick, with a brief to build a team that could make the changes to its IT operation necessary to accommodate a post-1998 deregulated market. McCormick had vast experience of the UK IT agency market, as a former recruitment director at a number of major UK agencies.

To ensure EME's new IT strategy was productive, the decision was taken that a number of designated business leaders within the company would act as business sponsors, with PSE and other suppliers, handling development.

"EME knew they needed a lot of IS Staff," says McCormick. "I created a preferred partner approach; appointing four agencies which were in competition with each other to provide me with a competitive and cost-effective service.

"I was keen that these agencies took on the role of our partners, because I wanted them to come to understand my client so well that they could represent them effectively in the IT staff market."

The overall goal was to build the profile of EME to a point where candidates were familiar with the company, and see it in a positive light. Says McCormick, "I set out with the clear intention of building a reputation amongst the candidate market that EME was a good employer."

McCormick's analysis of the market was that it was not an easy one to recruit in. Rates were rising rapidly - industry figures suggested by as much as 20% a year - skills were scarce; and because of this, contractors in particular were hanging on until the last minute before deciding which contract to take.

During 1998, McCormick created an efficient recruitment methodology and system, with the linchpin role of an interim manager whose job it was to oversee and co-ordinate the recruitment process.

More importantly, EME had, in close partnership with its appointed agencies, the able to offer long-period contracts, and ensure that candidates (contract and permanent) received firm job offers immediately after interview. Says McCormick, "This is no small point, because too many companies think they can call for a contractor on the Friday, and have them start the following Monday. It simply doesn't work like that."

EME was able to employ two hundred contractors, in specialist roles quickly and efficiently, at a time when skills were in demand and at a premium. It was able to ensure that its IT systems were being properly organised to cope with a massive change in its business: the 1998 deregulation of the UK energy market.

Copyright ©Reed Business Information 1998.