Digitalization has led to the transformation of the water sector, becoming essential in most processes , both at the level of water infrastructure operation as well as commercial management and related corporate processes: financial, HR or marketing, among others. New twists on design, processes, and ways of doing business also offer opportunities and fresh ways to approach challenges—or to challenge the status quo. The key action areas for digital transformations are outlined in Exhibit 3. Smart meters are a requirement for the advanced credit and collections algorithms that can identify which customers will need help to avoid default. View in article, Josh Bersin et al., The employee experience: Culture, engagement, and beyond, Deloitte University Press, February 28, 2017. Among utilities—electric power, water, or transportation—the electric power utility industry is undergoing a momentous change. HR will create strategies to find the requisite skills in the marketplace, or to develop them from within. Through a series of surveys, interviews, and working sessions, identify your company’s digital ambitions and create a blueprint of the new DNA traits you need to achieve them. The digitalization of infrastructure data allowed them to have maps and inspection data available to anyone in the organization at any time, and accessible with mobile apps. As part of the digitalization process, utilities are dealing with new challenges their organisation may never have previously faced. Utilities are partnering with cities and builders to implement sensing technology and data analytics in “self-learning” buildings, as part of integrated municipal energy and environmental planning. Digital is transforming the way power & utilities companies operate. Through new approaches such as design thinking and employee journey maps, employee experiences are understood and improved, while tools such as employee net promoter scores measure employee satisfaction.9 The digital DNA traits of agility, innovation, and higher collaboration levels are deeply embedded in the culture of the utility and evident in the way teams and employees interact.10 This ingrained digital mindset impacts the way work is performed and improves productivity, generates cost savings, and provides opportunities for new revenue streams. These innovations form the foundation of the digital utility, supplying the massive volumes of data that are its lifeblood. One result was a 10 percent increase in customer satisfaction. Press enter to select and open the results on a new page. And because of repeatable processes, it’s less likely to require heavy governance. Its creation is the most important contribution the IT department can make to the transformation. The sector is being reshaped by forces that have been evolving and converging for more than a decade. Utilities struggle with digitalization – especially in retail. Operational staff manages data as much as assets. The mounting pressure to transform also offers the rare opportunity to rebuild strategies, structures, and processes from the ground up. Efficiencies in energy and facility maintenance. Continuing what they’ve been doing for the last century is likely not going to work. Those that don’t seize the opportunity to evolve risk being left behind or displaced by more agile players. Utilities are left to clean up the mess. Showcasing technologies, products, and processes for digitizing utility operations. Similar to the smart home market, utilities are struggling to make use of digitalization in the customer segment. It will likely require an organizational transformation that introduces organizational, operational, and behavioral changes and instills them enterprisewide. McKinsey Insights - Get our latest thinking on your iPhone, iPad, or Android device. Download this eBook on Digitalizing Power & Utilities industry … Startseite INSIGHTS Digitalization of utilities operations. The “being digital” category is still quite small, populated by some of today’s most recognized technology companies, industrial enterprises, and others. our use of cookies, and Share. In the 1970s, power utilities were digital pioneers, using emerging technologies to facilitate grid management and operation. For the success of most digital transformations, therefore, two-speed IT architecture is needed. And that future could be bright. Besides smart metering, utilities are expected to leverage digital platforms for many of their operations. The water utility sector has made great strides in the uptake of digital technology. Taking action against systemic bias, racism, and unequal treatment, Key opportunities, trends, and challenges, Go straight to smart with daily updates on your mobile device, See what's happening this week and the impact on your business. In other words, they need to become ‘Live enterprises’ and thereby continuously observe, evolve and learn. It improves design by using cross-functional teams to understand end users more deeply and meet their needs more nearly. View in article, Capital expenditures for 59 of the largest US electric, gas and water utilities tracked by S&P Global have reached new highs every year since 2010, rising 116 percent from 2009 through 2018. Source: SNL Energy, accessed October 30, 2018. Digital technologies offer unlimited potential to transform the world’s water systems, helping utilities to become more resilient, innovative, efficient, empowering them to arrive at more economically viable strategies. See Terms of Use for more information. But at the same time, large enterprises such as today’s electric companies can take advantage of these opportunities to disrupt the industry status quo themselves and remain competitive and profitable. Smart homes, connected buildings, smart cities. With such tools, utilities can optimize staffing levels at power plants and manage the intricate energy terrain of renewable and conventional sources, trading options, and patterns in demand. Plants have higher heat rates and availability, are more demand-responsive, and profitable. Utilities are also entering into maintenance contracts that provide distributed facilities with improved service based on data analysis. ’ and thereby continuously observe, evolve and learn competence, and payment, described! From customers, government policy and regulation to improve operations and enhance customer services, products, and iterate concept. New capabilities, especially the rapid scaling of innovations analysis, and natural disasters also! 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