Business Performance Management: A Road Map for Utilities

By Kar, Sudz; Lopez, Marco | Management Quarterly, Summer 2008 | Go to article overview

Business Performance Management: A Road Map for Utilities


Kar, Sudz, Lopez, Marco, Management Quarterly


The product/service offerings based on business intelligence have come a long way since its inception. Utilities worldwide have realized the potential of this technology and have made significant investments into harnessing the benefit of these technology offerings. By leveraging analytics, utilities have been able to harness key information out of the operational processes. Taking a moment to analyze some of the utility companies and their usage of business intelligence (BI) products, one will find them in different quadrants of maturity.

The forces that have dictated this maturity positioning are numerous, be they regulatory pressures or operational efficiency concerns or environmental concerns or the mere appetite to absorb high risk on the part of the enterprise. This article examines some of the key usage positioning in the quadrants and the quantum leaps that are being taken by the companies to make more effective use of the service/product offerings. Additionally, this article examines how business performance management (BPM) has been positioned as a key strategic offering in the world of utilities by elucidating the process of energy efficiency programs and integration with other key processes.

Figure 1: Capability Maturity Model

* Will use it only if it can't do
without it

* Is still running a legacy system
with very high costs of
maintenance

* Continuously trying to put
out day to day
operations fires

[4]

* Waits until most people have
made use of the technology and
only switches if it becomes
an absolute necessity

* The cost of implementing
is more manageable

* Always in the Technology
catch-up mode

[3]

* Early adopters of the BI Technology

* Buying a Change agent to get a jump
on the competition

* Visionaries in their organizations

* High ability to handle risk vs. reward

* Uses the "Cool" factor as a
competitive strength to attract talent

[1]

* Pragmatists

* Waits for credible proof of benefits

* Follows the leader

* Adopts proven best practices in the
industry related to the technology

[2]

Early Adopters (Quadrant 1)

The organizations in this quadrant have played a visionary role in their industry vertical with regard to the usage of business intelligence and analytics. Typically, these organizations have a history of adopting new technology offerings and making the most of it by working with the product/service provider to adopt the technology to its maximum benefit. In the SAP * area, such ramp-up customers can be seen in a wide variety of areas. The players have often collaborated with the technology company to produce outstanding solutions that oftentimes become the benchmark.

They are continuously trying to harness value by creative techniques from the portfolio of products that they have. When other organizations are still grappling with the idea of value-based analytics, these organizations are already tinkering with service offerings in the BPM arena. They are in the process of using the latest levers in the area of analytics such as predictive analytics, data mining and accelerators to seek further value from their investments. An example here is the early adoption of SAP Strategy Management offerings by Pacific Gas & Electric Company (PG&E) to connect their operational planning and drivers with key strategy plans.

Pragmatists (Quadrant 2)

The organizations in this quadrant have waited patiently to see how the technology plays out in their vertical. They have conducted very careful studies to see the cost/benefit associated with the investment in business intelligence. Quite often, they have included business intelligence as a part of their total transformation program. These companies have followed the best practices route after carefully mitigating any risks associated with their investment. They have effectively partnered with big consulting system integrators to carefully define the processes and see where they can use business intelligence to provide value. …

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