April 27, 2017
Today I answered an inquiry about digital strategy and transformation programs in in the utilities sector and I thought I’d share some of my thoughts more widely. While I don't have any formal reports specific to utilities, the sector often comes up in discussions about smart cities and is one we track in our research on data and analytics. For example, utilities have one of the highest rates of engagement with insights service providers which illustrates their drive to better leverage data and insights to inform their digital transformation.
Several of the customer references we interviewed for our recent insights services wave were from the utilities sector. For example, an Australian power company described itself as a "poles and wires business” with significant investment in the network, and need to optimize investments. Their first priority was to improve digital operational excellence (as opposed to digital customer experience). However, the biggest challenge they had was the implication to the organization and the change management required to implement the insights into their operations. A water company in the UK engaged an insights service provider for similar operational and process optimization.
With deregulation and competition in the utilities markets in Europe, providers are also concerned (or should be) with the customer experience side of things. They are starting to think about (and offer) energy consumption dashboards based on feeds from smart meters. These dashboards can be accessed by individuals to understand their personal energy consumption, with alerts in case of anomalous usage patterns. An energy provider offering dynamic pricing can also push notifications when consumption and prices are low. The notifications can be acted up either manually with the consumer throwing a load in the washing machine or dishwasher, or automatically by an IoT-enabled appliance.
Working with Atos, the municipal utility in Grenoble plans to offer a dashboard that will eventually also allow consumers to compare themselves to others, e.g. their neighbors, peers, colleagues, etc. This type of offering was first offered by Opower, a US-based start-up bought by Oracle last year. I described their offering in Energy Data Fuels Innovation (Pun Intended) a few year ago. EDF offers a similar dashboard – e.quilibre – and benchmarking to their residential and commercial clients, and to cities for better monitoring of aggregate energy consumption and monitoring compliance with energy standards.
Clearly utilities are embracing digital transformation by pursuing opportunities both on the back-end, operations side of things as well as in front-end, customer facing programs. And, in many cases, insights services providers are helping them get there.