The Changing Role of the Utility CIO

By Henry Bailey, Global VP, Head of Utilities Industry Business Unit, SAP

Henry Bailey, Global VP, Head of Utilities Industry Business Unit, SAP

The role of the Utility CIO is changing dramatically as new business models and business processes threaten the century-old institution. Innovative companies like Google, Tesla, and Apple are now launching major initiatives, which will reduce electricity sold by utilities, change the customer engagement model and shift the consumer to a disruptive prosumer overnight.

In order to respond to this challenge, the CIO must enable a complete, real-time view of company situations and key figures across departments. This real-time viewis now critical for transitioning to a digital business landscape to improve productivity and decision making by accessing accurate information, answering ad hoc queries, and analyzing alternatives and implications in real or near-real time.

Digital is At the Core of Every Business:

Every business will need a digital core infrastructure to efficiently and securely connect key business processes into the enterprise. This can be completely on premise,cloud or a hybrid approach. More and more utilities are adopting a cloud and/or hybrid strategy (on premise core with cloud solutions integrated) moving past the Cap/Ex and cyber security hurdles as business models and regulatory obstacles ease around cloud investment.Many utilities start by moving common business processes such as workforce engagement, suppliers andnetworks, customer experienceand Internet of Things into a secure cloud delivery model, while continuing to keep core processes on premise in a real-time platform.

Benchmark Your Digital Maturity:

A digital utility must understand the requirements for digital transformation and to provide better, reliable service to the

customer at the lowest possible cost. Benchmarking has long been a pragmatic way to measure and compare performance within utility peer groups. Once the utility can see where they rank in specific business process areas, steps can then be taken to improve areas which are below average compared to top performers. Examples of some powerful questions for benchmarking are, “Can your organization predict the potential of asset failure, determine the best sequence for asset repair and still adhere to delivery commitments?”, “Can your organization receive real-time alerts when a customer is disconnected from the grid?” and “Has your organization developed new products or services to drive desired electricity, gas and/or water consumption behavior and identify target customer segments?”.Once these questions are answered and the results are collected and analyzed, the utility now has a starting point to understand where focus needs to occur. Almost every utility is different in the digital journey.

" Benchmarking has long been a pragmatic way to measure and compare performance within utility peer groups "

The Real-time Digital Boardroom:

Once the utility has transformed in a digital business, the CIO can enable other senior executives byreducing preparation time and offline topics preparing for board meetings. Right now, most leaders are challenged by heterogeneous reporting solutions and meetings dominated by static content. The concept of a “Digital Boardroom” transforms executive meetings from one-way presentations based on static media to interactive discussions based on real-time facts.

SAP transformed its own boardroom meeting into this real-time discussion and decision making process. This was achieved by using collaboration tools to leverage expert knowledge because C-level executives in the digital economy need real-time business intelligence, ad hoc reporting, and what-if analysis to make decisions for today and drive change for the future.

The Future is Now:

The utility is under tremendous pressure like never before. The CIO must act now to enable a complete, real-time view of company situations to ensure that the digital economy can be leveraged to manage the dynamic business models and improve productivity with the highest quality of service at the lowest cost possible. Utilities can start with taking the Digital Capability Maturity Assessment surveyto understand where they rank with their peers. They can then focus on those insights into digital transformation areas with the highest return for increased productivity and reducing operating costs.The utility CIO’s must embrace the technology available today to create the digital roadmap for the future to not be left in the dark and off the grid.