Talk to any industry leader in the utility domain, and the most common topic you hear is about the digital disruption the industry is going through. Along with the enthusiasm it brings, you are also likely to sense a nervousness in their tone. There is valid reason for this: dig deeper and you will realize that digital transformation has imposed a dictat on the industry to innovate rapidly and provide services that deliver better facilities and true value to its customers, while also requiring that it is acheived super fast. This transformation of the business models that we are witnessing today is a result of the ever-growing expectations from the value delivery by the utilities. But is the industry upbeat about adapting to these changes, and facing the challenges that will entail?
The nature of services provided by utilities require a high degree of reliability vis-a-vis operactions. This challenging environment involving service interruption rebates, ageing workforce, lack of specialised knowledge, etc., has put utilities on the spot. While they are making every effort to stay relevant in this changing world, the inherent challenges hinder progress, further restricting their pace of adaptation to the digital world. The traditional organizational structure of a utility has always forced it to look inward. Therefore, when change occurs, it has been a natural response for the utility to seek help from its own people, processes and assets as a shield against the challenges. The industry is experienced. However, with the pace at which the disruption is evolving, the traditional inward-looking practice and the complacency it brings, the industry is not able to tap into the full potential of new business models which digitization has opened up. The technological advances in areas such as IoT, AI, Predictive Analytics have been remarkable. However, utilities are coping with the limited availability of skilled resources to leverage these technological advances. It is therefore essential for utilities to seek the support they need to catalyse their journey into the digital world.
Partnering towards the world of tomorrow
Traditionally, utilities have been contracting tasks to external vendors. This partnering model operates in a purely transactional mode, employing a push mechanism for work being outsourced. Neither does it create the foundation for innovation nor does it allow questioning the status quo, thereby nurturing a culture of complacency. Functions such as construction, repairs, periodic maintenance, etc., continue to operate in this model even today. To be successful and future ready, the partnership model needs to go beyond the transactional, bringing on board a mechanism to complement everything that is critical to the utilities business today and in the future. The model should integrate partners, who are specialists in areas that bring expertise to support the journey towards digitization. The concept of service supply chain for integrating external entities would be a great value add, by allowing the partner company to be a part of the utility business value stream. These partners along with bringing on board their own expertise, also add their experience, learnings and best practices followed within their network involving other utility businesses.