Introducing automation is challenging. If you find yourself unsurprised by this sentiment, you are comfortably within the majority. And while this is certainly a universal challenge, the impact of an unsuccessful transformation is rarely felt more than in the energy and utilities sector.
This can be seen in the competing feelings businesses within the industry have towards digital transformation. There is a significant hunger among energy and utilities organizations for transformation and the introduction of automation. According to our recent global study, from 2017 to 2019, the percentage of organizations that have deployed multiple use cases rose dramatically from 28% to 52%. However, what is also clear is that businesses remain uncertain about how to manage effective transformation projects, resulting in only 15% of the same organizations having deployed multiple automation use cases to scale.
So, how do we bridge this gap between interest and action? How do energy and utilities organizations effectively manage transformation projects that deliver on their objectives and also support their customers?
Whenever I’m asked these questions, I respond with a three-pronged approach:
- establish clear objectives to focus the efforts of all stakeholders and teams,
- deploy multi-functional teams to support those objectives,
- emphasize challenges that can be addressed and that establish the viability of your transformation rapidly.
To understand how this approach can be so effective, let’s consider the example of Scottish Water, the company that provides water and waste water services to household and wholesale customers in Scotland. When the organization recognized the need to shift away from manual ways of working and begin implementing automation to support its processes, it faced the same challenges as any business. But by using these methods, Scottish Water was able to execute their digital transformation confidently, even knowing that a failed transformation would disrupt a service as critical as providing fresh drinking water to its customers.
Scottish Water began its transformation by creating a strategy that established four key objectives: differentiating the customer experience, keeping customer prices low, ensuring that its assets and services would be resilient, reliable, and secure, and supporting the Scottish economy. In so doing, the organization created a clear, easily understood vision for the transformation, enabling it to then dig deeper and identify the key capabilities it wanted to add to best support its goals. Understanding this vision enabled Scottish Water to define key milestones that would provide focus to its teams and that would allow it to scale its solutions in the future.
With this focus established, Scottish Water still needed the right people to drive the transformation. This meant getting all stakeholders on board with the project, assembling teams that could apply the necessary expertise to the tasks, and finding business leaders that would champion the transformation. To do this, Scottish Water created multi-functional teams that could break down any existing barriers or silos within the organization and work hand in hand with technology to pursue the common goals that it had previously established.
Finally, to build momentum around its approach to automation, Scottish Water further narrowed its focus to objectives that would quickly be concluded and yield a return on its investment. The organization was thus able to demonstrate the value of the project, instilling its stakeholders and teams with confidence. Just as importantly, this also ensured that Scottish Water could avoid long-term transformations that would be at risk of already being outdated upon completion. Instead, the business quickly exploited cloud platforms and digital technology in a matter of months and scaled those solutions to the point that they still delivered appropriate value.
In the wake of its transformation program, Scottish Water found new ways of working and demonstrated that they can transform parts of the business quickly and effectively. Within 10 weeks, the organization installed automation that took what had been a largely manual business and left it as a digital innovator. As a result of its automated solutions, Scottish Water can now onboard water and waste water supplies more quickly and with better control, quality, and stakeholder engagement. It has also equipped the organization with more intelligent data analysis, which has resulted in fewer interventions and an improved customer experience.
Recent estimates indicate that energy and utilities organizations could save $237 to $813 billion with the implementation of intelligent automation at scale. However, to get to that point, organizations need to know how to effectively manage their transformation projects. By setting clear objectives, enlisting multi-functional teams, and targeting small objectives that can quickly deliver value, prove the ability of a business to implement automation solutions, and ultimately scale, I believe the energy and utilities sector can rapidly begin to benefit from automation and experience the optimization we all know is possible.
Listen to our latest podcast with John Cairney, head of digital strategy & architecture at Scottish Water, to find out more about the company’s journey.
For more energy and utilities insights and analysis, tune into our World Energy Markets Observatory podcast.