Utility Week

Operations & Assets UTILITY WEEK | 14TH - 20TH SEPTEMBER 2018 | 25 Expert comment Are utilities taking innovation seriously enough? Wipro's Kishor Gowdra says many utilities still have a lot of work to do to embed a mature innovation culture. T he rate of technological transforma- tion within the energy and water spheres has increased exponentially in recent years and looks set to rise still further. Utility companies must be prepared to keep pace, but are they? Despite the monumental changes hap- pening, the mindset of the utility sector when it comes to innovation is not as devel- oped as it should be. Companies still do not fully understand the relationship between technology and innovation and wider busi- ness and industry dynamics. This research – conducted by Utility Week in partnership with Wipro – shows that, although the appetite for innovation is there, the innovation culture of many organisations remains immature. In fact, 58 per cent of respondents say the innovation culture of their business is "neither mature nor immature". Meanwhile, less than half of respondents consider innovation to be business critical. This is a worryingly low percentage and could result in utility com- panies being le behind in the relentless march of technological change. Encouragingly, companies appear to be receiving support for innovation from their boards. Additionally, many companies con- sider themselves to be fast followers when it comes to the adoption of new technologies. However, it is important that we question the term "fast follower", as it can be used as an excuse merely to follow the pack. The fact that just 29 per cent of respond- ents say their organisation has increased investment in innovation over the past five years is disappointing, if unsurprising. Over the next five years, certainly, it is paramount that utility companies are increasing the levels of investment in innovation into their organisation. Undoubtedly, artificial intelligence, advanced analytics, Internet of Things, and machine learning are extremely important technologies. However, it is vital that utili- ties do not overlook innovations such as blockchain and electric vehicles, which will have an unprecedented impact on the way their businesses are run. Twenty-three per cent of respondents say they do not consider blockchain will be transformative at all over the next ten years. As one industry commentator pointed out, this may well be because of a lack of under- standing of what the technology is and what it can do. If this is the case, it is critical that busi- ness decision-makers are educated in that regard, so their organisations do not miss out on the benefits blockchain can offer. Clearly, there is much work to be done to embed a mature innovation culture within organisations. Utility companies need to ensure enough is being invested to allow innovation to fully benefit the business. The new technologies coming in are vital to the evolution of the sector, and utilities must embrace them or else risk falling behind other industries and, eventually, becoming irrelevant. Being aware of the challenges facing the sector will allow utility companies to more effectively overcome them. We hope the findings of this report will provide food for thought and discussion, and help utility companies better understand the innova- tion landscape, so they are fully prepared for a transformation which is already fully under way. Kishor Gowdra, global head of solutions – utilities, Wipro Download the full report at: https://bit.ly/2NAHKe9 Brought to you in association with APPROACH TO NEW TECHNOLOGIES We tend to wait for technologies to become established/mainstream before attempting to adopt A first adopter A first follower Yes Yes, to No Not sure definitely some extent 48% 32% 19% 0% MANAGEMENT SUPPORT Would you say board and senior management team support for innovation is tangible and recognisable in day-to-day operations? 23% 45% 32%

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