The Competitive Water Utility: a Strategy for Success in the Information Age
By Ronald G. Lauer, Westin Engineering
The driving forces in the utility industry–downward pressure on rates, the demand for superior customer service, changes in regulatory requirements and the drive toward privatization–place a strong demand on the utilities to build flexible operational and business systems. Capturing and processing information in an integrated manner allows utilities to address these forces, while creating the competitive edge needed by all businesses in the information age. The first step toward obtaining the information needed to run a competitive utility is to critically examine the business` vision, mission, goals and objectives. Then examine the way you are operating today and how well you are positioned organizationally (structure), technologically and strategically.
Using the organization`s strategy as a starting point, a strategic plan needs to be developed which addresses technology, people, structure and the organizational processes that integrate them together. The involvement of people with technology enhances their personal productivity. Involving employees in the organizational structure through empowerment and team-based processes leads to a sense of ownership and involvement.
Identifying and assessing best practices both within the industry and externally by looking at how other excellent organizations accomplish similar functions can enhance any utility`s operations. The effective design and redesign of business processes brings it all together to create a truly competitive organization. Water utilities can improve their ability to competitively deliver a quality product by providing ways to easily share business and real-time operational information and make them available to other user applications. These include:
customer information and billing,
By linking together these and other systems, the utility can continue to position itself to respond to current and future regulatory and competitive events. To meet this objective, it is necessary to prepare a strategic plan which will result in a tactical (short-term) and strategic (long-term) direction to guide the implementation of the utility`s computer-based systems over the next five years and beyond.
One of the primary goals is the establishment of the utility`s information technology direction for the future which will facilitate efficient and cost-effective work processes, communication and the sharing of information.
Preparation of a strategic plan will be based on a study of internal utility work processes resulting in the development of an integrated tactical and strategic plan for business and engineering systems. The integration of the information systems for the utility and the ability to share data among all departments is one of the key objectives of this goal.
An integrated information system for the utility will facilitate the achievement of planning goals and fostering new competitive competencies. The figure illustrates the integration of water utility information systems. This information system model is rapidly evolving in the water industry with a number of implementation projects already under way.
Developing an Information Technology Strategic Plan
The plan establishes flexible solutions for specific problems that will readily integrate into a utility`s enterprise-wide information system. Recommendations address the more immediate tactical requirements of the utility over the next 12 to 18 months, along with a strategic five-year plan for the future. An initial set of goals are established, critical requirements are identified and prioritized, candidate information system projects are identified [maintenance management information system (MMIS), GIS, LIMS, CIS, SCADA, etc.] with budget estimates made and implementation action plans developed over the planning period.
The whole focus of the strategic planning project team is to create a consensus-building environment in which to identify utility needs, establish priorities and develop implementation strategies and design concepts. The end result is a well thought out enterprise-wide plan which meets the needs of everyone according to what`s best for the utility in fulfilling its overall mission and business goals. A roadmap of results which clearly addresses the utility`s tactical and strategic needs over the five-year planning period will show the project interdependencies and the steps and associated costs to make it happen year by year.
A major change in the information usage paradigm has occurred in order to support the need for shared information on an enterprise-wide basis. At the same time hardware and software computing technologies have been changing dramatically from the closed centralized host machines to the fully distributed open systems (client/server) architectures of today. Dedicated application software serving individuals has given way to group oriented applications where data is automatically replicated between sites and is shared in a seamless manner throughout. Workflow tools are evolving to help automate our work processes, and collaborative software has emerged to aid in consensus building and decision making. This coupled with a vastly improved communication media and the rapidly evolving Internet/Intranet information infrastructures is causing water utilities to organize more effectively for the future. Technology has become a very significant business planning element and a utility`s best ally in managing staff growth in the face of increasing demands and competition.
Many utilities today have computing infrastructures based on disparate systems operating as “islands of automation.” A number of utilities have grown beyond this level and have integrated these systems together on the physical layer in order to provide basic e-mail, printing, file transfer and archiving services between computing environments. In support of this, many different databases exist employing a number of different database structures throughout the organization. Sharing of data is difficult, especially beyond the boundaries of the originating organization. The end result is extensive duplication of labor in developing/analyzing information to satisfy vital work requests within the utility. Some utilities are embracing this change and have actively planned for their future information architecture and now are in various stages of implementing the hardware and software infrastructures to support it. They are developing enterprise-wide database designs and data warehousing schemes to ensure that their critical information is protected and available for use on a wide variety of applications. They are building a collaborative computing environment which will be the center of their operation and decision-making process.
The California Department of Water Resources (DWR) , Sacramento, Calif., operates and maintains the California State Water Project, which generates power, controls floods, provides water for farm irrigation and domestic consumption, and establishes many recreational areas. Major features are its 17 plants and more than 450 miles of aqueduct. Within the plants are more than 120 hydroelectric units providing water pumping, power generation and pumpback generation. The water moved through these plants is conveyed in the California aqueduct and its branches with the flow controlled by more than 70 flow control structures.
Construction of the State Water Project was largely completed prior to 1974 and the computer systems are of that vintage or older. Therefore, the DWR has embarked on a major program to replace the power plant and aqueduct flow control systems and to upgrade the control centers. In addition, an extensive fiber-optics communication system and a number of nonreal time information systems are being done in parallel with this upgrade activity.
This project is in progress and is being conducted over a nine-year period. It is the largest electric and water control system of its type in the United States. Most of the control system upgrades are now complete, including a new fiber-optic communication system which runs the approximate length of the aqueduct (450 miles) and serves as DWR`s WAN for both its control system and business computing needs.
Current project focus is on the MMIS, which is one of many applications gradually being integrated into the DWR system to take advantage of enterprise-wide information. Work is currently being done with old and new technologies to gradually merge them together. Both are using the same communications infrastructure that will take them into the future. The message here is that it doesn`t happen overnight and that a well laid out plan is essential for success, one step at a time.
Roadmap To Success
As stated earlier, the first step toward obtaining the information needed to run a competitive utility is to critically examine the business` vision, mission, goals and objectives. Once you have completed your information system strategic plan, and used it to gain approval of capital funds, it`s time to start building your information system infrastructure one step at a time over the planning period.
A well-defined plan will illustrate the steps to take for each of the many projects identified in your plan. You can start by developing a project methodology roadmap consisting of a three-phase plan:
1. business process evaluation,
2. information system planning and design, and
3. system implementation, deployment and training.
By following a truly organized plan, with its interdependencies clearly defined and implemented over several years, the project becomes very manageable. The end result is a whole series of successes leading to a gradual increase in shared data enterprise wide. This will ultimately position your utility to become increasingly competitive in the information age.
Ronald G. Lauer has 29 years of experience developing computer-based control, information and communication systems for automating water, wastewater, electric and gas processes. His technical expertise includes real-time distributed process control systems, SCADA, management and engineering information systems, and system integration. Lauer received a master`s of science degree in electrical engineering from Oregon State University.
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The California Department of Water Resources relies on advanced information technology applications to manage the world`s largest aqueduct system. Photo courtesy of California Department of Water Resources.