Does your utility have a survival strategy?
Historically, regulated industries have been slow to embrace disruptive technologies relative to their peers. For decades, their monopoly status removed competitive pressures to innovate and retain their customer base. But my, how times have changed. With non-traditional providers and solutions emerging every day, the traditional utility as we know it must transform to keep (and compete for) market share.
For example, have you taken the time to consider Walmart, Amazon and Ikea a threat to your stability? If you answer ‘no’, I suggest you think again. When the brand new IKEA moves into town, know that they aren’t simply showing up with a warehouse full of cost-effective furniture, but a microgrid to go alongside it. And, retailers aren’t the only industry beginning to leverage distributed energy options such as solar to defray their energy costs.
This reality is forcing utilities to do more than “just keep the lights on” to meet the demands of their business and satisfy customers. The evolution of how organizations/people get their energy and a market push toward energy decentralization means that utilities are now accountable for addressing rapidly-shifting customer needs and expectations like never before.
But while utilities may have lagged other sectors in digital transformation, they are rapidly catching up, embracing next-gen technology at scale to stay ahead in a shifting market. With over 18 years working within the industry, I’ve come to find the following three strategies as shared among winning utilities organizations:
1. A culture defined by digital-first (ask the right questions)
As outlined above, utilities face a unique challenge in the marketplace today. They need to invest in revitalizing aging infrastructure and power grids, yet face flat or declining retail sales due to the ongoing push for energy efficiency. This, combined with the ever-present threat of non-traditional competitors pushing into the energy space has the industry scrambling. This emphasizes the need for a culture that embraces new technologies that can help realize cost savings or reinvent processes today.
One way to help adjust your organization’s culture is to attract and retain talent that brings next-gen thinking to the forefront. Leading utility companies are giving these restructured teams more freedom to test new solutions, and they are encouraging the application of emerging technologies like artificial intelligence, machine learning and IoT connection in the field. Plus, they are focusing on reskilling their existing labor force, ensuring everyone is engaged and has an enhanced role in the transforming digital landscape, top-down and across the organization. Not only does this help make the best use of existing talent, but it engages the up-and-coming employees who will lead their organizations to embrace a successful “Utilities 2.0” framework in the years ahead.