Utilities companies have been required to manage the risk of crises long before the COVID-19 pandemic arrived. As an essential industry, they must always be prepared to deal with storms, wildfires, hurricanes, heat waves, and other disasters. Customers need the vital services they provide—even more so in difficult times. That means the utilities must build technology solutions that will help them be flexible and agile so they can be prepared for the unexpected.
Accelerating Transformations for SAP Utilities Customers
As we checked in with SAP utilities customers this year during our 2020 virtual ASUG Best Practices: SAP for Industries, we heard many of the same themes as we did at our last gathering in San Diego in 2019. But this time, the transformations are accelerating and the stakes for connecting with customers are higher than ever. All types of utilities customers shared how they are getting their SAP transformation projects done, as presenters from Algonquin Power & Utilities Corp., Cleco, UGI Utilities, Essential Utilities, Inc., and SaskPower explained how they are remaining resilient, yet adapting their approaches for these times.
Over the course of three days, we heard these SAP utilities customers reinforce four key themes.
Theme 1: Utilities Adapting Rapidly Get Ahead in the Race
The day-one keynote featuring ASUG CEO Geoff Scott and Michael O’Donnell, National VP of Utilities at SAP, summed up how the transformations going on last year are still in play. Though now utilities are adapting to the added pressures of COVID-19, including decreased commercial use, increased home use, and customers facing challenges with paying their bills. “Even before COVID-19, the utilities industry was in a massive state of change. There were lots of things going on that utilities were going through, whether it be the changing nature of customer engagement or the evolution of grid and green technology,” O’Donnell said. “Then when you think about what COVID-19 brought to the table, it really forced utilities to quickly pivot and think about how they do work in a remote fashion.”
Through these challenges, O’Donnell was optimistic about what he observed in how these companies were approaching their technology initiatives. “From an IT perspective, we saw utilities do a great job in being able to move quickly and continue IT projects in a remote setting.” He mentioned a few companies that stood out in their commitment to keeping these transformations going, including Duke Energy, Southern California Edison, San Diego Gas & Electric, Dominion Energy, and Southwest Gas.
The SAP S/4HANA Question
When the inevitable question of moving to SAP S/4HANA came up, O’Donnell stressed that this should really be about what will bring value to your business. “It’s not like there’s one magic pill for every single organization. I think there are different needs within different companies based on the answers to questions such as when they implemented SAP to begin with and how far they are in their evolution,” O'Donnell said. Adopting SAP S/4HANA is the first step in building a foundation to drive the organization forward and meet its future requirements.
Theme 2: Customer Connections Are at the Center of the Modern Utility
As we heard last year, a number of SAP utilities customers have built their transformation projects around establishing stronger connections with customers to serve them in the way they prefer. This year, utilities companies were speaking the language of retail businesses, referring to the concept of real-time customer engagement, 360-degree customer views, and running e-commerce supported “energy stores.”
It’s no longer enough for utilities companies to rely on a self-service web portal for customers. Self-serve touchpoints are not islands. According to Thomas Lord, VP and CIO of UGI Utilities, “Our mobile app was ahead of the curve, but now it’s essential for more complete outreach. From a customer segmentation standpoint, we need both to drive adoption and make that platform core to our overall customer experience.”
Keeping Customers Happy Post-Acquisition
The amount of M&A activity and consolidation happening in the utilities industry increases the challenges for organizations looking to deliver a seamless customer experience across disparate legacy systems introduced through acquired entities.
In a fireside chat with Michael Sullivan, VP Utilities at SAP, Ruth DeLost-Wylie, SVP Business Transformation at Essential Utilities Inc., described the multiple acquisitions she had experienced in just the past few years and their effects on customer experience. “We purchase six to eight utilities a year, so we’re always in acquisition mode,” DeLost-Wylie said. “We desperately needed a system that would significantly improve customer service.”
Think Tank Discussions Among Customers
At the end of day one, customers gathered at different Think Tanks for more intimate discussions about topics that included “Exceeding Customer Expectations with Self-Service Technologies.” Leigh Booth, who is the customer service superintendent at the utilities department for the City of Oklahoma City, described how the utility had been reading meters with boots on the ground every month while it had been working on a project to add automation—until COVID-19 brought the meter reading to a halt. “Suddenly customers were seeing an occasional estimation on their bill, at a time when you don’t want to introduce anything different with their experience,” Booth said. “Customers have a voice like never before today. Boy, did we hear it from folks who saw an increase in their bill and didn’t understand our processes.”
High customer expectations came up in a panel discussion on customer engagement transformation. Andre Guillory, the START program manager and director of metering, billing, and revenue collection at Cleco described how this is driving the utility to be more proactive with customers. “We’re thinking beyond the resolution for customers once they contact us,” he said. “We are comparing their customer journeys to the Amazons and Googles of the world.”
Theme 3: Avoid the Big Bangs and Pilot Instead
Despite the major transformation projects going on for the utilities sharing their stories, we also heard from a number of SAP customers that they are moving away from big-bang implementations to short-cycle projects and pilot programs to get these new advances in the hands of their users. As the business faces rapid social, environmental, regulatory, and people changes, utilities customers must be able to deliver technology solutions to support these more quickly than ever. That means relying on more cloud-based and Agile deployments, as well as on bringing in automation and artificial intelligence to get IT teams out of maintenance mode so they can work on strategic projects and innovations.
NextEra Energy described a customer pilot program it took on in two phases for a 15-month project that involved an SAP billing engine, web portal, meter integration, field management system, and back-office system. The pilot was guided by the principles of customer satisfaction, protecting the bottom line, staying regulatory compliant, and bolstering team confidence. Senior Director Customer Information Systems Michael DeBock summed it up by saying, “Every utility listening to this should think about running pilots.”
Running a “Happy Path” Pilot
The NextEra Energy team did two pilots before its go-live. One was what DeBock described as “the happy path,” designed around simple transactions completed with carefully selected customers (including employees) to ensure the project’s foundation was strong. The second pilot brought in 100,000 customers, including commercial and industrial customers, to complete more complex actions. The NextEra Energy team was able to deploy on time and on budget using the pilot mindset, building the team’s confidence along the way. “You can always plan for a clear-blue-sky utility, but you can’t count on that,” DeBock said. “We’re a Florida-based utility, so we get lots of storms all the time. You have to be good in blue and gray skies.”
Theme 4: People Power Your Technology Projects
One common theme that came up in nearly every presentation was the importance of people to the success of these technology projects. That includes not only customers, but employees and contract workers. Utilities customers spoke about the critical nature of the teamwork necessary to complete these projects, especially when working with multiple teams that can’t be physically together.
In an ASUG Women Connect virtual panel on leading through a crisis, CIO of Advansix Jackie Grunwald gave her perspective on what we should be learning in these very unusual times. “We shouldn’t be trying to get back to normal—we should be thinking about moving forward.” She described how she misses the spontaneous interactions she once had with coworkers. “But that just means we must be more thoughtful in the way we communicate and how we spend our time,” she said. “We need to create more platforms to make connections where can have those informal discussions again.”
Changing the Aircraft Engine Mid-Flight
Kurt Sweetser, Director of IT at Southern California Edison, emphasized the value of teamwork as he described executing a customer information system transformation program during COVID-19 and wildfire events in California. He described this complex project that will replace 160 applications as, “changing the aircraft engine while flying through turbulence.”
The keys to success for this project, according to Sweetser, was all about identifying risk and rapid decision-making. “We had to order the helicopter to get to the mountaintop,” he said. “We needed to make decisions without having to run through a chain of command.” The team looked to several principles for guidance through the project, including acting as one team, rewarding transparency, governance discipline, and agility. “Having everyone rowing in the same direction and feeling protected enough to disclose problems early was critical,” Sweetser said. “Technical problems we can solve—it’s a lot harder to get a team of 1,300 rowing in the same direction.”
Though we connected virtually this year rather than in person, the ASUG Best Practices: SAP for Industries Utilities sessions gave customers plenty of opportunities to share their knowledge and continue on their individual paths toward transformation.
Watch all of the utilities sessions on demand, along with the rest of ASUG Best Practices: SAP for Industries.