Our priorities

Our strategy is designed to address the complex issues the industry faces in ways that can deliver sustainable value for our shareholders.

Our vision is to be the leading integrated energy company in our chosen markets.

As an integrated energy company, operating upstream by developing and investing more than ever before in new sources of gas and power, and downstream with strong brands and innovative propositions, we have a robust approach to meeting the challenges ahead. We set our strategic priorities at the end of 2006 and continue to operate the business in line with the four priorities that are highlighted in this section.

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1 Transform British Gas

We will deliver consistently high levels of service and profitability with consistently more competitive products and services.

Why?

  • British Gas Residential (BGR) is the core of our business
  • We need to deliver a competitive service level, product offer and price
  • Historically our profitability and service levels at BGR have been low and variable

How?

  • Improve our price competitiveness, service levels and product offer
  • Reduce costs through ‘best-in-class’ productivity
  • Ensure we remain a great place to work
  • Achieve long-term margins of 6-7%*

Progress so far

Improved customer offer

  • We reduced the tariff for customers with prepayment meters
  • We launched 'Dual Fuel Extra' our priority response product in conjunction with British Gas Services
  • Our Fixed Price 2011 proposition proved particularly popular
  • Ofgem report concluded that effective competition exists between the major energy suppliers

Improved customer service

  • We increased the percentage of customer enquiries which were resolved on the first call
  • Our proportion of industry complaint levels fell by nearly a third to 25%* which is lower than our overall energy market share
  • Our average time to answer and to handle calls continued to fall
  • We substantially reduced transactional exceptions associated with the migration of our customer base onto the new billing system

Reduce cost; while remaining a great place to work

  • Our operating cost base in 2008 was over £200 million* lower than in 2006
  • In February 2009, for the first time, British Gas was recognised by The Sunday Times as one of the '20 Best Big Companies to Work For'. Entry to this prestigious list only follows after a rigorous assessment

Future focus

  • We will build on our already strong brand and seek to deepen the customer relationship by combining the energy and services businesses into a single customer-focused organisation
  • We will launch new bundled products that customers want under the British Gas brand, to increase customer loyalty and further reduce costs
  • We will continue to take full advantage of the increasing demand for energy efficient products and services
  • We have the largest commitment of all suppliers to vulnerable customers and will target them even more efficiently

*Figures taken from the 2008 Annual Report and Accounts, correct as at 31 December 2008

Market context

We operate in a complex, global industry with profound long-term challenges.

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