Energy Central Power Perspectives™: Welcome Bob Champagne, New Expert in the Digital Utility CommunityPosted to Energy Central in the Digital Utility Group
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- Jul 21, 2020 10:30 am GMTJul 16, 2020 2:48 pm GMT
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Over the past few years, utilities have really stepped up their game in the area of digital transformation and innovation. Talk of the new “digital utility” is all around us, with a seemingly endless set of interpretations for what that will really look like and what utilities will need to do to take full advantage of a more digitally enabled business model.
As a hub of the best and brightest leaders in the utility sector, Energy Central strives to continue to add to our community of experts who can help guide conversations, lend their insights into the day’s news, and generally help us by contributing their perspective borne of years of experience, study, and more. With that in mind, I’m thrilled to introduce Bob Champagne, Vice President of Digital Innovation and Research at TMG Consulting, one of our latest members of the Energy Central Network of Experts.
Bob has over three decades of experience in driving transformative change across the energy and utility sector leveraging data-driven insights and digitally-enabled innovation. Over his consulting career, he has advised over 120 utilities worldwide across both regulated and competitive energy and utility markets. In this installment of our ‘Welcome New Expert Interview Series’, Bob shares some of the key aspects of his personal journey in the area of digital transformation and innovation, and some insights on what he sees as the next phase of digitalization in the energy and utility sector.
Matt Chester: We’re so happy to welcome you to Energy Central as a member of our Network of Experts, both in Digital Utility and in Utility Management as well. The value that experts can bring is really predicated on the community knowing about you, your background, and what you can bring to the community, so can you start by sharing with us some of your background and some of the key things that have shaped your perspective in the digital transformation space?
Bob Champagne: Thanks Matt. Looking back on the 30 years I’ve spent in the industry, there were so many things that went into shaping my views on digital transformation and how we approach the projects and journeys we’re asked to help architect and navigate.
Frankly, such a large part of this goes back to the very early part of my career with Entergy in New Orleans, where I was part of a team supporting their first real organizational transformation initiative, a pretty daunting assignment for a 24-year-old straight out of college with zero background on how a utility really worked. Ironically, one of the things that experience taught me was that real transformation had far less to do with the “mechanics” of processes and technology behind it than it did with organization and cultural aspects of change, an area that can really limit the value of business transformations if not kept front and center. That’s a principle I carry with me and is central to any project I’m involved in with to this day, regardless of its scope and complexity.
From there, I joined the world of consulting where I was lucky enough to work with some really bright people at UMS Group as we pioneered one of the industry’s first global peer-to-peer benchmarking initiatives called PACE (Performance and Competitive Excellence), a performance improvement network where we brought together literally hundreds of practitioners from around the world in a program of comparative measurement and best practice discovery. That’s really where I cut my teeth, as it provided me a 360-degree view into what was driving performance advantage at some of the leading utilities across the world, the best practices they were adopting, and how they were addressing some of the real-life organizational and cultural complexities that had long impeded the progress of process change and technology adoption. Although the operating environments of today are obviously different, many of the performance breakthroughs we uncovered in that time period are as relevant today as they ever were.
Since 2010, my focus has been mostly on the digital aspects of utility transformation, how utilities are tapping into the myriad of new data streams that are available to them, and how they are applying data-driven insights directly into their business transformation endeavors. Through that work, I’ve had a front-row seat into the challenges utilities were facing in “monetizing” these improvements from the perspective of bottom-line impact and improved customer experience.
MC: Would you mind sharing with our audience of an example of where their digital investments can be better harvested and “monetized?”
BC: Sure Matt. I’d point to my last role before joining TMG where I focused specifically on extending the value of smart meter intelligence more broadly across the utility operating model, something that I’m still passionate about and have written about extensively over the past few years.
That was an incredibly exciting time for me as it was a great example of how technological advances in physical infrastructure, advanced analytics, and smart automation could be combined with the more foundational aspects of process, organizational, and cultural change to create a real step-change in digitally-enabled innovation. It also happens to be an area that if done right can unlock millions of dollars in new opportunities for any utility in the process of an AMI deployment.
But AMI is just one example. With the myriad of data utilities have on customer transactions, interactions, operating intelligence on assets, and data from external markets, the opportunities to drive digital innovation further into the operating model are just beginning to become clear.
MC: When we first spoke late last year, you shared a view with me that digital transformation is not a new phenomenon for utilities. Can you expand on what you mean by that and its implications for those managing digital transformation inside their utility?
BC: One of the reasons many industry veterans still cringe at terms like “digital transformation” is that it implies that a) this is something brand new for the industry, and b) that it is the most important part of the business transformation equation. And both of those statements couldn’t be further from the truth.
For me, it’s always been strategy and process first, followed by people, organization, culture, and ultimately technology. In fact, it’s that view that has characterized some of the more digitally innovative utilities I’ve worked with over the years. Align the organization, define the processes, design the ideal customer experience, and THEN determine how technology can best enable those changes. Veterans in the industry who have succeeded with business transformation would say this is the real recipe for successful transformation.
What is new and exciting about the stage we are at in transformation journey as an industry is the way in which all this is coming together. Take the advances we’ve seen in advanced metering. Just a few years ago, the major reasons utilities were embarking on AMI deployments were to reduce manual meter reading costs, automate connections, accelerate collections, and accommodate new rate structures like TOU, all classic example of technology being used for basic automation and enablement of the core business. Utilities that are excelling in digital transformation today, however, have begun to look at this much more holistically. What inefficiencies or lost opportunities exist across our operating models, from infrastructure, to customer, and even to the commercial and financial processes of the enterprise. And which of those can be accessed and enabled with the data that AMI offers? That not only strengthens the value proposition, but can also identify a new or different mix of solutions that can more directly attack this expanded set of opportunities,
It’s a simple flipping of the equation, one that starts with opportunity and moves to technology rather than the other way around. Too often, utility executives hear of someone else either inside or outside of the industry that embraces a particular technology and then they seek to implement it without clear goals about what problems that software can actually solve.
MC: What are some of the trends you see differentiating leading utilities in the digital transformation arena in 2020?
BC: For me, it all goes back to how successful utilities are at leveraging their digital assets they have to work with, harnessing the right data from within and across our digital ecosystems, and putting it to work across the operating model. The data environments being implemented by leading utilities today are light years ahead of the traditional databases that many of our utilities were initially built upon. Getting that foundation in place has clearly been a dominant area of focus for leading utilities.
Another is the enormous strides companies have made in advanced analytics and modeling capabilities and the new generation of smart automation those innovations have enabled. This has really become the engine for digital innovation at leading utilities. The whole analytics space has transformed itself from a function centered around reporting and data mining to one that can predict and simulate the performance of assets under stress or the consumption behaviors of customers under different operating conditions. That’s been a real game-changer.
I’ve also been particularly impressed with how vendors have evolved their application suites to make better use of these digital assets within their operating workflows. Through use of more AI-enabled solutions, for example, utilities have dramatically reduced manual back-office workloads and representative-assisted call volumes. Advanced load disaggregation and forecasting has found its way into new pricing plans, program offerings, and customer engagement applications. And we’re starting to see the value of true digital orchestration across applications, something that will become increasingly important as utilities look to reinvent customer journeys, integrate distributed supply resources, and other capabilities that stretch the boundaries of functional applications. The real value of newer DERMS, CRM, and other “orchestration” solution is, by definition, their ability to stitch together the mutual dependencies that exist across infrastructure, supply, and customer business units rather than sub-optimizing on a single business unit’s requirements.
MC: What do you see as the biggest challenge for utilities as they progress their digital agendas in the next several months and years?
BC: As I suggested earlier, so much of the challenge lies in the leadership, organizational, and cultural environments within which digital innovation occurs.
Most utilities already have pockets of innovation occurring all over their enterprise. It’s not the desire or ability to innovate that’s the problem, or even the technologies it has at its disposal. It’s having the leadership and processes in place to help take these initiatives over the goal line, monetize and socialize the gains, and establish a scalable process for replicating those successes across other parts of the operating model.
One of the trends we’re really excited about is the emergence of the “digital factory.” Think of it as a manufacturing “plant” for digital assets and insights that transforms them into new sources of value for customers and the business. Formalized structures are beginning to pop up inside of utilities whose sole purpose is to catalyze and replicate digital innovation across the enterprise. Whether that manifests itself as an “office” of digital transformation or innovation at the C-suite level, or just a well-coordinated process for managing the portfolio of digital initiatives, central leadership of the digital agenda is quickly becoming a defining characteristic of leading utilities.
MC: So, what’s next on your agenda at TMG?
BC: Our main goal with the Digital Innovation practice at TMG is to help utilities get ready for, and navigate, the next stages of their digital journey. Part of that involves extending TMG’s proven methodologies in application/solution planning, identification, sourcing/procurement, and implementation that clients have relied upon in CIS, AMI, MDM, and Asset Management Environments and applying those methodologies more holistically across utilities’ digital ecosystem.
Over the years, however, we’ve found that coupling that with peer-to-peer learning and collaboration can be a real accelerator for change, as it brings real-life examples and best practices to the table that utilities would otherwise have to access through time-wasting trial and error.
So a few months ago, TMG announced the launch of its Digital Utility Collaborative - an 18-month program aimed at providing members access to the latest research, benchmarks, and best practices around digital transformation and innovation emerging across the industry between utilities, solution providers, and thought leaders. We’re kicking that off at the end of the month with our annual “2020 State of Utility Digitalization” report that will be distributed to sponsors and members of the collaborative, and the commencement of a monthly collaboration forum that will focus on the exploration of 10 key trends shaping the future of utility digitalization.
Having seen first-hand the value that benchmarking and best practice sharing can have on catalyzing business innovation in the utility space, we couldn’t think of a better area to focus on than right here in the digital transformation space.
MC: That sounds great, Bob. Any parting thoughts for our readers?
BC: I would just like to say thanks to you, Matt, and the Energy Central team for the opportunity to share some our insights with your community. I know we both share a common goal of helping utilities lift their game and are excited about the synergies that exist between our two communities.
I’ll go back to what I said earlier- digital transformation and innovation are really not new concepts for utilities. Utilities are full of really smart people and are surrounded by vendors and solution providers that are continuously introducing new innovations to the market. The real challenge is how to bring this ecosystem together and orchestrate it in ways that will tap into the myriad of opportunities that will be revealed in the operating models of tomorrow. We’re excited to be blazing that trail with the best and brightest minds out there.
Please join me in thanking Bob Champagne for sharing with the community these experiences and viewpoints that will inform his role as a new contributor to the Digital Transformation Community. When you see Bob engaging around the community, please don’t hesitate to reach out and ask him questions in the comments sections or just say “Welcome.”