Water & Wastewater Treatment Magazine
Issue link: https://fhpublishing.uberflip.com/i/1223154
The Knowledge: innovation zone T he water sector in the UK is facing unprecedented chal- lenges ranging from population growth and the changing climate, to regulatory pressures and delivering a better customer experience. All while being charged with adapting to technological advances, embracing digital transformation, and implementing the NIS (National Information & Security) Directive. In England and Wales there has been a rigorous (some would say tough) price review process, with the water regulator Ofwat challenging the utilities to drive transformational innovation through their business, pushing innovation, develop- ing change and doing more for less. Four water companies consider that their final determinations are too onerous and have asked for referral to the Competition and Markets Authority (CMA). AMP7 will be characterised by finding a balance between the investor demands, operational practices, developing an inno- vation culture, meeting customer expecta- tions – and, not forgetting working with the supply chain! And all this whilst being expected to transform the water sector! At one end of the scale pwc have speculated that over the long term, sev- eral scenarios could emerge: fewer water companies could exist; community water companies could emerge; step changes could occur that bring catchment manage- ment to the fore, changing the remit of the companies; or a vibrant household retail market could open with customers at the centre. Whilst the future is uncer- tain – change is happening! But what will really define transforma- tion in the water sector will be a better whereby utility company staff experi- ence their business from a customer point of view. Collaboration is key A key component of transformation is the water utilities collaborating with SMEs on open innovation. This requires the water utilities' innovation, R&D and asset management teams to challenge existing behaviour, be more creative and to adapt to new entrepreneurial practices together. Accelerating open innovation can only be achieved through realigning everyone around 'value'. Whilst the concept of value proposition is not new, bringing all the parties together to co-develop the value proposition around the utility chal- lenges is still novel in the sector. This has to change if we are to see genuine innova- tion being taken up readily and frequently in the sector and most importantly shared across the industry to overcome common challenges, with each utility taking the lead on specific challenges. Ultimately, focusing on this value proposition and collaborative approach will also secure lasting corporate and SME collaboration. Once open innovation becomes busi- ness as usual, we then need to encourage the formal patenting of innovations and technologies so that the UK can capitalise on the undoubted talent that exists in the sector but which has up to now been undervalued and overlooked. The Future Water Association believes that this is so important that there should be a regula- tory target linked to patent activity in the UK as one of the key innovation metrics, helping to drive creativity and new think- ing throughout the sector and, indeed, the world. Paul Horton, chief executive of the Future Water Association and a WWT editorial board member, examines what a transformation of the water sector might look like. experience for customers. l Open innovation will need to be part of business as usual practice: bringing together the utilities, customers, suppli- ers, universities, scientific stakeholders and public institutions to enable effec- tive knowledge exchange. l Recognising that all types of innova- tions need considering from small incremental changes to fully disruptive digital solutions such as smart network systems and So–ware as a Service (SaaS) for example. l Creating an active patents market that stimulates intellectual property: research by Future Water Association demonstrates that this could be a huge boost for the water sector. l Setting the longer-term strategic direction for the sector: the planned development of a sector-wide innova- tion strategy by Ofwat, together with an innovation fund, is a positive move, alongside the net zero by 2030 target, but more direction is needed. l Better analysis of data, existing and newly generated - embracing digital transformation, utilities can turn this data into actionable information - this will be key to future resilience. l Clear narrative: change the sometimes negative discussion about the water industry, instead celebrate the impor- tance, value and critical roles of all those working in the sector. l Creating a positive culture to chal- lenge the way things are done in the water sector, everything from business processes to procurement must be open to change. l Alongside this is customer immersion (think supply chain and consumer) 46 | APRIL 2020 | WWT | www.wwtonline.co.uk Transforming the water sector