Utility Week

UTILITY WEEK | 2ND - 8TH AUGUST 2019 | 23 Operations & Assets Brought to you in association with: Tips for change 'Put in place the systems you need to deliver on required outcomes.' T he roundtable discussion highlighted a trend for water companies to procure directly from the tier 2 and tier 3 supply chain providers rather than a small number of tier 1 suppliers. It's a trend we're seeing in the US too, and utility com- panies over there are watching closely what is happening in the UK and what they can learn. In our view, this approach has three main consequences: • The need to expand existing, and sometimes introduce new, capabili- ties (such as programme manage- ment o€ ces) that are required to manage a complex portfolio delivery function; • The need to review the processes and underlying systems to e„ ec- tively manage, govern, and control a new approach to delivery, both in terms of data provision and engagement; • The need to ensure that the service is scalable to help cope with a signi… cantly higher number of sup- plier interactions. The consequences to portfolio delivery means that water companies need to consider their operations to help ensure they deliver to required outcomes and determinations. True vertical and horizontal align- ment: This entails breaking down the siloed mentality and allowing contract and project-level data to be available in near real-time for e„ ective long- term decision-making by programme and portfolio delivery teams. Processes: Water companies need to eliminate manual processes and instead adopt automated, standard- ised re‰ ections of "good practice". Manual, inconsistent processes amplify the risks of error and omis- sion, leading to a lack of trustworthy information with which to make e„ ec- tive decisions at the portfolio level. Interface plans: A fully integrated interface plan is needed to delivering projects, programmes and portfolios. Over time, these can help drive the required outcomes, but more impor- tantly, they can help ensure the utility company has a transparent delivery engine with which to collaborate to ensure successful outcomes overall. Change: Change – in scope, cost, schedule, risk, etc – must be captured in near real time and integrated to the portfolio so that its impact can be measured. This helps ensure there is no signi… cant detrimental e„ ect on the expected outcomes. Technology: Water companies must establish a collaborative, intuitive, 'sticky' platform that supports true alignment between the organisa- tion and its ever-increasing supply chain. The platform should enable all manual, inconsistent processes to be automated to help reduce data handling, errors and omissions; and to eliminate data silos. In addition, data should be able to ‰ ow seam- lessly ensuring the impacts of change, interfaces, schedule slippages, etc. are always visible and that program and portfolio teams can make e„ ective decisions. Innovation: As the supplier base increases so does the needed level of programme maturity, so any technol- ogy platform must support ongoing innovations. Currently on the horizon are tools to support resource and materials tracking for productivity purposes, as well as video progress measurement, among others. Water companies need to embrace innova- tions as they look to do more with the same or less. The bene… ts of adopting the above are substantial, but achieving the needed change is no small feat for many organisations. Success- ful adoption will require executive sponsorship as a driving force, and the transformation must be thought- fully planned to deliver incremental bene… ts in bite-sized chunks. This will take time, but such transformation is critical to meet the challenge. The full version of this article is avail- able online at: https://bit.ly/2Gtmo0G Opinion Geoff Roberts Director of energy industry strategy, Oracle Construction and Engineering learn how to look past the sort of polished responses you get with the management contractors, and not scare them o„ by trying to o– oad too much risk," was one piece of sound advice. However, those present also reported that in moving to work directly with smaller com- panies they had not seen any deterioration in health and safety processes, or attention to customer service. "You do have to be prepared to be more hands-on, provide more coaching and sup- port – and again this adds to internal costs, which shouldn't be underestimated," was a nugget of wisdom brought to the table. A key ingredient for success, said our delegates, was ensuring that all were using the same so™ ware to provide "one source of truth". While it had been commonplace for tier 1s to take this approach, moving to smaller companies o™ en meant supply- ing them with client so™ ware. The move to the cloud also facilitated sharing so™ ware resources. "It is slightly easier with tier 2 in that you can set the rules in terms of how you set and present the data, so we all use the same hierarchy." Taking an "intelligent client" approach had paid handsomely for one water company, which reported savings of 18 per cent on the cost of capital programmes by taking the direct route. He expected to save another 10 to 15 per cent in programmes in AMP7. "But in taking more risk, you also have to expect that sometimes projects fail," he said. Network representatives taking part had gone as far as establishing direct workforces for some of their maintenance work, where they could be heavily … ned if problems were not swi™ ly addressed. Employing direct workforces tended to reduce productiv- ity, they said, but the upside of that is that quality and pride in the work is better. "It also allows you to grow your own talent in a market with an ageing workforce, and where skilled workers are in short supply," reported one network asset manager. Beware Trojan horses One intriguing development, perhaps unsur- prisingly, was that tier 1s, were also bidding for work that the clients were pitching at tier 2s – or putting in bids from other brands in their groups, perceived to be o„ ering a lower cost and overheads. What was apparent from our group was a clear determination to cast aside past assumptions, behaviours and habits. Deliv- ering more for less is never easy, but on the evidence of this discussion they are up for challenge – and in good¥hands.

• Cover