Utility Week

Operations & Assets 22 | 14TH - 20TH SEPTEMBER 2018 | UTILITY WEEK W ater and energy utilities face a radical shake-up as forces such as climate change and shis in consumer behaviour drive them to find new and innovative ways of operating. Alongside this, new technolo- gies are being brought into the mainstream. Companies can choose to either capitalise on the benefits of these or get le behind. However, organisations have yet to embed a strong innovation culture within their organisations. The results of this survey, commissioned by Utility Week and the Wipro Innovation & Technology Council, show that although many utilities feel their internal innovation culture is "neither immature nor mature", no respondents feel their organisation's innovation culture is "very mature". While this is perhaps unsurprising, because innovation is relatively new to the utilities sector, it is clear innovation needs to be much higher on the agenda. One industry leader who spoke to Utility Week says the fact that any of the survey respondents view innovation merely as "nice to have" is "shocking", while other industry observers argue that all organisations should be adopting innovation into business-as-usual. However, in order for this to happen, buy-in from senior leadership is criti- cal. In this area, the survey results are encouraging – with support from com- pany boards perceived as strong. Many respondents felt their organisation's current approach to technology adoption was suitable for the level of change expected over the next five years. Other findings might suggest this is because they are underestimating the amount of change that is coming, rather than because they are fully prepared. Certainly, there is a sense that utility companies need to become more agile about adopting new technologies and new ways of doing things, or else risk becoming obsolete. The rull report, Innovation and Technology Strategies in UK Utilities, explores how those responsible for innovation view their organisation's ability to support the uptake of new technology and the processes needed to thrive in a digital future. It investigates the extent to which they feel their organisations have acknowledged and are adapting to the disruptive forces that require innova- tion – both independently and in response to regulatory incentives. How well do they feel their businesses are doing in accepting and respond- ing to the existential threat of transformative technologies? How successful have they been in adopting the cultures and gaining the investment needed to nurture innovation? And how prepared do they feel for the level of innovation and technology development that will happen over the next 5-15 years? The scope of this report takes in opinion from a wide range of organisations operating in energy networks, energy retail, water wholesale and water retail. Insight report The business of innovation Exclusive research by Utility Week and Wipro asked utility leaders about the sector's openness to innovation and whether companies were prepared for the forces of transformative change. Key findings: Almost half (48 per cent) agreed strongly that their board and senior management team's support for innovation was tangible and recognisable in day-to-day business operations. Just under one-fifth (19 per cent) did not feel there was this level of support present. More than 4 in 10 (65 per cent) respondents to the survey agreed that their organisation had increased investment levels in innovation over the past five years. Over two-fifths (45 per cent) felt that their organisation viewed innovation as important, with a smaller proportion (39 per cent) viewing innovation within their organisation as critical to their business. Over half (58 per cent) felt that their internal innovation culture was "neither immature nor mature", with no respondents finding their organisation's innovation culture to be "very mature". Of those incentivising and rewarding innovation, almost half (48 per cent) felt the incentive schemes used were effective in bringing forward innovation in their organisations. Almost half (45 per cent) considered themselves to be fast followers when it came to the adoption of transformative new technologies, with around one-third (32 per cent) preferring to wait until technologies became established. Many (65 per cent) felt that their organisation's current approach to technology adoption was suitable for the level of change expected over the next five years, but this decreases over time, with just over one-quarter thinking this approach would be efficient for the change expected over the next 10-15 years. Advanced analytics, AI and the Internet of Things were seen as the most transformative technologies available to organisations over the next decade. In 2015, Wipro partnered with Utility Week to establish the Technology and Innova- tion Council, a group of utilities leaders with responsibility for innovation and tech- nology strategy in their organisations who meet regularly to discuss ways of fostering collaboration across the sector. To find out about joining the Council or attending a Council event, contact Elaine Munn: elaine.munn@ utilityweek.co.uk

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