"Little i" Innovation: The Key to Adapting Utility Customer Programs in a COVID-19 WorldPosted to AESP in the Energy Efficiency Group
- Jun 23, 2021 8:54 pm GMT
This article is republished from the December 2020 issue of Strategies, AESP’s exclusive magazine for members.
Yes, crisis drives innovation—and the COVID-19 crisis is once again proving that necessity is the mother of invention. Hands-free door knobs, drones that can fly indoors to sterilize spaces using UV lights, food delivery via robots, and face shields created using 3D printing are just a few of the countless pandemic-inspired innovations. If you were to Google “COVID innovations” you’d likely be blown away by the sheer number of ideas that the pandemic has spawned. (But be sure you have some time before you go down that rabbit hole!).
The first is that, while radical innovation -- known as “Big I” innovation in business parlance -- is exciting stuff (I mean who wouldn’t want to have invented the personal computer or the iPod) more often than not, incremental innovation (also known as Little i” innovation) is what’s needed. This is the case when adapting an existing service or process, such as a utility rebate program. Adapting to a COVID-19 world has meant applying a lot of “little i” thinking to existing processes.
The key to moving expeditiously in business, is to accept the fact that good enough is the new perfection. As demonstrated in the figure below, when launching a new product or service offering — such as a Utility Customer program — the appropriate goal is for it to land within the “good enough” circle at release. Then to improve it over time so that it moves closer to the right side of the ‘good enough’ circle.
Silicon Valley and the tech world, figured this out long ago. Software companies, for example, used to have long development cycles working up to a new product release. Major upgrades often came only on an annual basis. Now, leading software companies have embraced Agile methodology; a key to this is that they develop software in short sprints, pushing out upgrades as often as every two weeks.
You might be thinking that comparing a utility to a Silicon Valley tech company is not a fair comparison. After all, utilities have traditionally been on the slow end of the speed spectrum when it comes to innovating and adapting customer program offerings. This is due in large part to the fact that most utilities are regulated entities whose program plans and offerings must be developed, documented, and approved by an oversight commission. Given these constraints, is it even reasonable to think that a utility could act like a Silicon Valley software company? Well not completely, but I do think it’s possible to take steps in that direction — particularly with regard to the concept of making smaller, more frequent improvements.
While “big I” innovation in the Utility program world (e.g., launching an exciting new program offering) might be tied directly to a two- or three-year planning and approval cycle, utilities and their program implementers often have the latitude to pursue “little i” innovation within the bounds of an existing program cycle.
Nexant’s approach to doing this for the utility clients whose programs we design and administer, is to apply a key element of continuous improvement theory — the Plan-Do-Check-Act cycle, also known as the Deming Circle, named after its founder the American engineer William Edwards Deming.
The Plan-Do-Check-Act cycle is a never-ending cycle that aims to help you improve further based on achieved results. I won’t dive too deeply into the details, but will offer this quick summary of the phases:
You might be thinking “how in the world does applying this model help you act quickly? It sounds rigorous.” My answer to that is to point out that the theory of continuous improvement and the Plan-Do-Check-Act cycle, recognizes from the start that you aren’t going to get everything perfect right out of the gate. That recognition alone is freeing and can help prevent paralysis by analysis. This doesn’t mean that you do a sloppy or half-hearted job of planning, just that you don’t get stuck in the planning phase forever since you know that, once you begin doing, you’ll be checking results and will have the opportunity to adjust as needed to get even better results.
I think it might help at this point to look at a specific example. Let’s use the virtual inspection process that I mentioned above as a mini case study.
The first step in any planning phase is to clearly define your goals and/or the problem that you are trying to solve. In our case, the problem was that COVID-19 was making it unsafe for program staff to conduct physical inspections to verify energy efficiency equipment being rebated. So our goal was to develop a virtual inspection process that could take the place of physical inspections.
Ideally the process 1) would be easy to understand and follow, 2) could be accomplished using widely available software and tools, and 3) would provide a high degree of confidence in the inspection results.
With these goals in mind, we set about the process of identifying and then developing the procedures, system changes, documents, and tools needed to support a new virtual inspection process. These would include the following:
A customer- and trade-ally-facing document — the Virtual Inspection Guide — provides detailed, step-by-step instructions on the process.
Initially, we envisioned a process that would have required that each inspection be conducted via a remote tour using video conference technology. But then we executed a practice that I like to call “stepping into the reality zone”. I picked up this practice from a former boss of mine, who had marked out a 2-foot by 2-foot box on the floor of his office using yellow tape. On the wall above the yellow box was a sign with an arrow pointing downward. The sign read “Step into the reality zone.” This is not meant to place limits on creative thinking, but it is certainly a very useful tool to help identify potential pitfalls, and to narrow down options after a good brainstorming session.
Our trip to the reality-zone lead us to recognize that:
So we decided to add a second option: allowing the participant to submit photos to document the project, instead of doing a video tour. This gave us the flexibility to choose the method that was best suited to a situation and the applicant’s preference.
With the process nailed down and documented in the Virtual Inspection Guide, the system updates in place, and the communications ready to go, we launched the new process, announcing it to the trade ally network. We reached out and began scheduling and conducting virtual inspections for projects that had been placed on hold while we worked out the details of the new process.
A couple of weeks into the new process, and it was time to check on how things were going.
I want to pause here and stress that we only waited a couple of weeks before we checked in. In many cases, you don’t have to wait six months before you check on results; in fact, in most cases you don’t want to. That’s the beauty of continuous improvement—you can decide on how quickly to circle the block via the plan-do-check-act cycle. The first time around the block often takes the longest because you generally spend more time in the planning phase, but thereafter you are seeking to make incremental improvements, so those second and third trips around the block are much faster. You gain momentum.
We spoke with trade allies who had used the virtual inspection guide. And we talked with our own internal staff about how things were going and what could be improved.
Based on the feedback from trade allies, we identified multiple opportunities for improving the virtual inspection guide. We expanded the number of facility types for which we provide specific examples.
And we also added a 'tips' section for each example facility type...
We also learned from staff that they were finding it challenging to organize the sometimes large volume of photos that were being submitted. So we developed a new Excel-based inspection form into which staff could import the photos received (via simple macro buttons). This allowed us to store the many photos received in an organized manner that could be easily associated with the matching measures on the rebate application.
The end result of these efforts was that we reacted quickly, put a system in place that allowed us to quickly pivot our inspection processes to the new reality, and then, by applying processes of continuous improvement, built an even better and more efficient airplane while keeping it in flight.
They say that “necessity is the mother of invention”, and COVID-19 has certainly forced invention. If nothing else, the COVID-19 pandemic has been a lesson that utility program teams and their implementers must be prepared to adapt and innovate more quickly than has traditionally been done. Utilities who understand the value of “little I” innovation, put processes in place that expedite the planning and launch of new offerings, and implement a process of continuous improvement, will be better prepared to handle the next unplanned crisis, whatever it may be.
Jim Giordano is a Principal with Nexant’s Utility Services division where he works with utility clients in designing and delivering commercial and industrial program offerings. Jim has more than 25 years experience in the field of energy management. He also serves on the board of AESP’s Southwest chapter.
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