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Three Forces Impacting the Utilities Sector

Utility companies around the globe face a powerful new wave of disruption. Pressures such as grid modernisation, an aging workforce and regulatory change are becoming major challenges. Yet these challenges also represent bright new opportunities for utilities that are open to changing their ways of working and running leaner, more effective operations.

Here we explore three of the main challenges, and how the appropriate use of digitisation and mobile technologies can enable utilities to adapt to the future and achieve new levels of performance.

Force 1: Technology advancements

Utilities are already seeing huge growth in the use of technologies such as sensors, robotics, IoT, virtual and augmented reality. These developments are reshaping how utilities safeguard, manage, maintain and monitor their large, long-lived assets. However, utilities have not been as fast to embrace new digital ways of working that improve the performance of their workforce.   A study of US companies by McKinsey showed that utilities have achieved only a moderate level of digitisation; well below that of other industries. This is perhaps due to the fact that utilities are typically more cautious about embracing new ways of working. This mindset will have to change as technology advancement continues at pace - utilities will have to choose between being locked into their old business models or investing in the path to becoming a true digital enterprise. The technical ecosystems are certainly there to make progress a reality. Field workers can now be equipped with mobile devices for rich media capture, and Machine Learning algorithms can identify patterns and surface the right information at the right time. Utilities must now press ahead with implementing effective digital strategies that can match the best-in-class players in other industries that have already embraced workforce technology.

Force 2: Regulatory challenges

Regulatory uncertainty is a major issue for utilities companies, as companies are forced to meet increasingly stringent legislation that puts pressure on operating costs. Navigating this evolving regulatory landscape requires utilities to remain flexible and open to evolving their operating models to meet performance targets. Field operations play a central role in meeting regulatory standards, but field teams often have weak workforce management systems in place to support them. We have seen many utilities struggle with capturing field observations, optimising scheduling and routing, and leveraging data to improve manager interventions. Equipping the workforce with digital solutions that help support their work in an increasingly complex environment is a sensible investment to meet regulatory standards.

Force 3: The aging and ‘new-age’ workforce

The average fieldworker at many utility companies is getting older. Fieldworkers have an average age of 50-55 years; when they retire they could be taking with them a great deal of knowledge and experience. Tools that enable collaboration amongst field teams could improve the sharing of best practices and stem this risk of knowledge-loss upon retirement.

For an industry that isn’t often regarded as on the forefront of innovation, it has also proved difficult to attract young and technically competent workers. This is due, in part, to the tools and processes used in utilities companies. These tools typically lack the functionality, simplicity and connectivity that a ‘new-age’ workforce takes for granted. Providing a newly emerging workforce with new tools that complement their abilities is a certain way to advance the recruitment process. And when that happens, similar tools such as video or chat can connect older and younger workers for a vital transfer of knowledge that will support the workforce of the future.

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