Communication Technology, Distribution Automation / Substation Automation, News, Smart Grid

Tech trends for utilities in 2020: digital transformation will not be driven by technology

Disruptions and adaptations have become the new normal for utilities companies over the last few years, but challenges reached a fever pitch in 2019: shifting regulations; evolving customer demands; digital pressures; cyber security. High-profile crises this year grabbed headlines and forced companies to rethink their decision making, but the slow buildup of these collective pressures is just as impactful. Together, these issues are fundamentally evolving the way utilities run their businesses – including speeding up the adoption of technologies that can help optimize and improve their delivery.

As the calendar flips, these pressures will continue to amplify, so – to stay competitive – it can seem like the response must be equally as dramatic. AI; RPA; Machine Learning: these technologies seem akin to vitamins organizations can swallow to strengthen their reaction to all of these shifting dynamics. In fact, those who have a more thoughtful approach on how to address these trends will be the ones who best ride out this wave of disruption.

In 2020, the most successful digital transformations in the utilities industry will be driven by the challenge they are solving for, and not for the sake of technology. Here’s what these companies understand – and how they’re approaching their transformations differently.

1. They understand HOW their constituents want to be engaged.

Data is now instantly available: last week’s cash flow, how many steps we’ve walked today. Of course consumers also want to know their energy consumption – but more than that, they want to understand its impact on the environment, and what they can potentially do to change their impact. This means that the standard utilities business model for customer engagement has drastically evolved given an increasingly aware – and expectant – generation of consumers. What was once a transactional relationship has now changed into one focused on experience.

This is a big change for most utilities, where providing information on consumption and how to possibly reduce that consumption has been the extent of a more proactive engagement model.

Consider what happens when an organization takes the next step into delivering insights. What if you could help customer understand how they can reduce their consumption and their carbon footprint? For example, by offering real-time data readings, or interactive, comparative graphics to understand the impact of, say, an extra hour of heat. Or by mapping out the habits of similar households with lower rates and sharing those practices for the customer to consider adopting.

A digital transformation can make all of this possible – but undertaken without a true understanding of what your customers need could easily lead to a significant investment with little use.

2. They understand WHAT tools are needed to deliver on these expectations

Adopting digital tools to address challenges can only be effective when there’s a true understanding of the issues. That’s the fallacy of the data driven-utility: it’s not all about technology. It starts with people, both inside and out of their organization. Smart organizations will recognize that employees are the most important part of the process.

Successful organizations don’t throw technology at problems; their leaders will start by asking the right questions, investing in the right due diligence, and aligning their teams with the right approach to be successful. This last step is so critical, and one that organizations too often get wrong. Even with a thoughtful and well-executed approach to digital transformation, rollout without a workforce that is correctly skilled and trained to deliver those solutions means the investment will come up short. This issue takes on a particular urgency in the midst of today’s technical labor crisis. Utilities have to put the effort into bringing on staff with the right skills, and into equipping them with the right training, to reap the impact of their transformation.

Only then does it make sense to layer in the technology: creating a consistent process that pulls in the rightdata and incorporates the right technology platform/solution to produce the best outcomes/results. This approach delivers on what consumers are demanding – more accurate and more actionable information and insights.

Many utilities struggle with defining a business case for initiating a digital transformation. But when the conversation is driven not by the technology but rather by the smartest way to address internal and external challenges, the use case becomes easier to discern.

2020 will see massive adoption of technologies in the utilities space. But for the most successful organizations in this industry, it will only be the lever of a well-defined strategy.