Specifications on the Utility Consultant
By Jerry Locsin, Senior Editor
With deregulation and rapidly advancing technologies, the utility industry is now discovering the tremendous opportunities for growth and exposure to new markets. Each utility looking at future growth or at entering a new market can greatly benefit from the knowledge of various consulting firms.
A good consultant will constantly emphasize that quality emanates from within. The utility must create its own quality procedures while the consultant merely guides the project. Consultants can help set direction as well as provide guidance, encouragement and structure. Like any honest salesperson, a good consultant should want to truly assist the utility with solutions tailored to that client`s needs.
Consultants in the utility industry come in many sizes and forms. In general, utility consultants can be broken down into three categories: engineering consultants, marketing and technology consultants and hybrid service providers.
Engineering consultants, such as Westin Engineering and EMA, provide technical expertise and management consulting tasks on various system projects. Their main focus is providing an external unbiased viewpoint and assistance on technical projects, such as control center design and communication system implementation. They should be well-suited to complement the technical and business expertise of the utility staff.
Westin Engineering, for example, offers a complete scope of engineering services for all aspects of system projects, such as SCADA, GIS and AMR. It serves a variety of utilities, such as Cincinnati Gas & Electric, Eugene Water & Electric Board and the Sacramento Municipal Utility District. Services offered to the utility industry by Westin include energy cost analysis, contract documents preparation and construction inspection.
Marketing and Technology Consultants
Marketing and technology consultants, such as cfar International and G2 Research, specialize in providing tactical assistance for technology assessments, acquisitions, business development and strategic planning. This type of consultant may also provide market analysis studies addressing market directions and sizes and a strategic and competitive assessment of the marketplace.
cfar International, a global network of affiliate consultants, focuses on utility automation and finds opportunities for automation to be used as a competitive asset. In addition, cfar aids the utility to deal with technological advancements, organizational changes and regulatory mandates.
G2 Research is another consulting firm that stresses the importance of information technology as a critical tool in the development of new organizational structures and business processes. G2 offers sales and marketing benchmark metrics to utilize as realistic guides for corporate performance measurement. They are especially strong in the systems and network integration market.
Hybrid Service Providers
Hybrid service providers, such as KEMA-ECC and Black & Veatch, are generally the larger consulting houses with broad-based expertise across several industries. In this case, the utility may find that this type of firm can provide the system hardware or software as well as the consulting services. Caution must be taken by the utility to avoid any conflict of interest. Hybrid service providers` offerings include assistance in the system implementation solution to its business process reengineering. System integrators also fall into this category. KEMA-ECC, for example, offers services ranging from transmission access and pricing to utility mergers and acquisitions.
Selecting a consultant is one of the most important decisions a utility manager can make during the initial stages of the project. Qualifications, experience and reputation are of critical importance. Selection based primarily on compensation factors–with little or no consideration given to competence–can result in unsatisfactory service to the utility and higher overall life-cycle costs.
Considering that you can hardly pick up a newspaper or magazine these days without reading about mass layoffs, it`s clear that many displaced managers are holding themselves out as consultants to the business community. Indeed, the consulting business has more than doubled over the past 10 years. That`s not to say that all executives-turned-consultants are bad. But with the market awash in self-proclaiming experts, the danger is that potential clients may end up with a consultant who is woefully inexperienced or who has hung out a temporary shingle to gain some dignity while conducting a job search. The hiring of this type of consultant can only lead to misguided advice that wastes time, money and staff energy.
When deciding which firm to hire, look at the company`s performance on projects of a similar nature, the project manager assigned, the company`s ability to provide all required services and its history of quality assurance. These factors will substantially influence the project`s operation and maintenance costs.
Before ever beginning to talk about compensation, it`s important to have detailed discussions with the consulting firm to adequately define the quantity and quality of the services to be provided. Misunderstandings can occur when the scope of services and the utility`s expectations haven`t been agreed upon before setting the compensation in stone.
The utility can get the most from a consulting firm which can serve the project from the conceptual study through its design and project start-up. Divisions of responsibility are thereby minimized and the rapport developed between the consultant and the utility can add to the project`s success.
Utilities should hire consultants only after considering all relevant factors. These include ascertaining whether there is a genuine need for consultants` services, identifying the scope of consultant involvement and the criteria on which consultant selection will be based. In addition to these criteria, utilities should look for consultants who are willing to share their knowledge and deliver quality work regardless of the fee structure.
It`s also advantageous for the utility to ask for a listing of similar projects performed by the firm under consideration and a list of client references. These references should be called and asked about the quality of work provided by the consultant, its adherence to schedule and budget, its responsiveness and how it handled unforeseen problems related to the project.
It is important that the utility select a consultant that it will feel comfortable working with–a consulting firm comprised of individuals whose guidance will be invaluable and that will serve the utility`s interest over the long term and ensure successful completion of its projects.
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An engineering consultant reviews a utility document for accuracy.
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Choosing the right consultant is like selecting the right tools for the utility`s needs.
10 Reasons Why You May Need a Consultant
1. To stay abreast of industry trends.
2. To relieve staff overloads.
3. To train (or re-train) your staff.
4. To fill a short-term personnel void.
5. To get a quick start on an important project.
6. To help get a project organized.
7. To help prepare/critique proposals.
8. To expedite completion of a project.
9. To get an objective opinion on a key issue.
10. To add credibility to your own research.
(Courtesy of cfar International Ltd.)