Digiterre’s Rajesh Jethwa is named in the top 30 of the 2023 CIO 100
A survey by the International Energy Agency, the IEA, amongst European energy companies’ last year, revealed that investment in digital transformation to date had been largely hardware-based, focusing on smart meters and electric vehicle charging.
Investment in software for wider transformation however, seemed to be lagging behind hardware with no planned increase in budgets. Similarly, with respect to new software solutions like artificial intelligence (or AI), the energy sector came in last compared to most other industrial sectors. Nevertheless, there are many solutions based on AI, machine learning or other digital approaches now available to the energy sector.
A recent KPMG report showed that to address the rapidly emerging trend of digital disruption, 28 percent of CIOs in the UK energy sector are starting to respond by contracting out assistance and 27 percent are partnering, whilst 23 percent are retraining their people and 15 percent are hiring. At Digiterre too, we’ve noticed a massive change in the adoption of transformative software solutions at energy companies over the last 12 months or so. Things are definitely changing.
To be really successful, digital transformation should be designed around an energy company’s existing strengths, including their product portfolios, their people and technical competencies and especially, their customers’ journeys. Projects and partnerships must also be designed with the connected goals of digitising core processes as well as upgrading IT platforms.
Digital transformations also bring about a shift in culture and attitudes. The business horizons for utilities have typically been relatively long in duration. The energy industry is traditionally based on the use of very expensive assets requiring extensive investment and incorporating regulatory requirements. With the rise of distributed generation, alternative energy sources such as green energy and the data-driven customer interface, energy companies are now entering an information-based digital economy. Success for them depends on having new capabilities, especially the rapid scaling of innovation.
So key success factors for these companies immersing themselves in digitisation include the following:
As tough as digital transformation programmes might appear to individual companies, the potential opportunity from it is worth many times the associated cost and risk. Digitally advanced sectors such as retail and financial services have already demonstrated that the value in digitisation is greater than anyone ever predicted!
For energy companies, digital transformations can yield huge productivity improvements, revenue gains, better network reliability and safety, enhanced customer acquisition and retention and entry into completely new business areas.
By: Rajesh Jethwa
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