This is the first of a four-part blog series that explores the challenges and introduces a practical management framework for utilities to consider when embarking on a large grid modernization effort.
The utility business model is undergoing profound change in terms of how energy is produced, delivered, and consumed. Customer needs and expectations are rapidly changing in response to disruptive technology, an increased focus on resource preservation, and the desire for more choice. To adapt and thrive in these changing times, utilities are faced with the need to modernize an aging transmission and distribution (T&D) infrastructure while embracing new technology and operations technology (IT/OT) systems. Utilities are besieged with requests and demands to transform and adapt, and to do it quickly, or pay the financial and operational consequences. Utilities must be able to effectively execute large-scale programs that will modernize their field and back office technology infrastructure programs, such as:
Utilities are challenged to successfully deliver on these transformational efforts all while continuing to provide safe, affordable, and reliable service to all customers.
Without proper structure, communication, collaboration, and control, these programs become susceptible to a host of risks that can impede progress, erode benefit realization, and ultimately put utility operations in jeopardy. The size, scale, and impact of these programs represents scope complexities and an integrated program culture foreign to a typical operating utility. To align with the expectations of a very demanding set of internal and external stakeholders, including regulators, these highly-visible and expensive grid modernization programs must be managed properly by a team with the unique methods, skill-sets, and experiences.
For large grid modernization programs to not only complete on time, on-scope and on-budget, but also to drive the required benefits to customers and the utility, requires a program management (PMO) methodology and tools that have been designed for, and are continually adapted based on experience in grid modernization programs.
From our experience deploying grid modernization initiatives for the nation’s largest utilities, we have gained a unique understanding of the effort required. Our PMO methodology incorporates 11 key, highly interdependent components of complex transformation :
Effective use of a standard program management framework can help identify and mitigate the array of risks that, if not managed properly, can slow progress, and erode potential benefits.
In the next three parts of this blog series, we will take a deeper look at each of the core elements of this Grid Modernization Program Management Methodology. We will introduce each concept, explain its purpose, and describe practical approaches to adopt and deliver this framework.
Author: West Monroe Partners