The utility industry is facing an unprecedented challenge as it grapples with the rapidly changing landscape of the electric grid. The surging popularity of electric vehicles, growth of remote and hybrid work, and increasing reliance on renewable energy sources have made managing the evolving state of the electric grid a central issue. Adapting to these changes is imperative for operators to successfully monitor and manage electric grid assets and energy consumption patterns.
Modernizing the grid and optimizing technology are key to navigate these realities. However, the industry is held back by a complex IT environment that silos information and applications, impeding operational efficiency and making transforming the grid more challenging. Utility operators must focus on implementing state-of-the-art technology that integrates all data into a shared view that can be easily accessed across the network lifecycle.
The industry's challenges don't stop at technology; a workforce crisis is also looming. As older workers retire, recruiting the next generation of engineers to replace them has become increasingly difficult. This underscores the need for operators to revise their workforce strategies alongside upgrading their technology to ensure successful electric grid transformation.
The challenge of hiring and retaining qualified technical workers
The backbone of the utility sector lies in its workforce, and without competent employees, even the most advanced technology would be rendered useless. And yet, the industry faces a significant challenge in attracting and retaining qualified technical workers.
The existing workforce is aging and many experienced employees are approaching retirement. As a result, recruiters struggle to find individuals with the necessary skill sets to fill critical positions. This issue is highlighted by a McKinsey study, stating that nearly 90% of executives and managers in the tech sector report experiencing skill gaps in their organizations or expected them to arise within the next five years. The situation is made even more critical by the nature of utilities gearing up for digitization and decarbonization at the same time looking for the same skills.
Energy recruiters are particularly concerned about the aging demographic of the workforce and lack of sufficient recruitment and training initiatives. While some operators have launched targeted training programs, more work needs to be done to address the rapidly widening skills gap. With 56% of energy recruiters expressing their concerns, it is clear that urgent action is needed to ensure that the utility sector has a competent workforce to meet future demands.
Empowering digital natives
Although many utility companies recognize the importance of embracing modern technology to keep up with the consumer demands, they are struggling to determine the best starting point. Deloitte's report "Positioning utilities to win the battle for talent" highlights industry’s tendency to be stagnant, slow to adapt, and lacking innovation.
Nevertheless, this presents an opportunity for companies to address two issues simultaneously. By implementing modern technology, operators can increase their operational efficiency while also attracting and retaining the next generation of technical talent.
Rather than solely focusing on filling the skills gap created by retiring senior employees, operators can tap into the digital skill sets of Gen Z and Millennial workers. This approach enables them to refresh the set of competencies instead of sticking with outdated methods.
Digital twins are an example of modern technology that can be implemented. These can break down silos and boost operational efficiency by enabling information-sharing among teams. Digital mapping is also likely to be more user-friendly for generations who grew up with technology, as opposed to traditional paper maps currently in use.
Implementing modern technology is a critical strategy for attracting and retaining top talent in the utility industry. However, it is equally important to consider existing employees during this transition. All team members must feel like active contributors to achieve success in digital transformation, and involving employees throughout the technology development process is crucial to achieve this.
To ensure employees support operators during their digital transformation journey, their on-the-job experiences should be taken into consideration during the entire process. This involvement can lead to increased job satisfaction, a sense of ownership, and long-term retention, making employees valuable contributors by providing input for future improvements.
Forward-thinking companies are embracing digital transformation, moving away from manual processes towards a fully digital environment. This eliminates information silos, improves network data quality, and reduces workplace incidents and response times to electric grid outages.
By involving employees in the digital transformation process, utility companies can build a culture of innovation and collaboration, ultimately leading to a more efficient, productive, and motivated workforce. This strategy also helps companies retain institutional knowledge and experience, as well as attracting new talent with the promise of a modern and dynamic work environment.
Highlight the benefits of modern technology
The implementation of modern technology may cause concern among existing employees, particularly those of older generations, who may worry that their jobs are threatened. Therefore, it is highly important for utility operators to clarify that the implementation of modern technology is not an opportunity to replace employees but instead to improve working life.
Operators should avoid framing the adoption of modern technology as a way of replacing existing employees. Instead, they can highlight the additional value that technology can bring to all workers, regardless of their length of service. For instance, operators can emphasize how technology can democratize access to information and provide workers with tools that can enhance their performance and make them integral to the transformation of the grid..
Active involvement of the workforce is pivotal in addressing the challenges being faced by the utility industry. Operators can achieve this by providing up-to-date technology that leverages the expertise of Gen Z and Millennials while ensuring that existing employees are continually kept involved and up-to-date with any changes being made. The wealth of experience held by the latter group can be invaluable in the implementation process.
Utility workers play a critical role in enabling our daily lives and will be instrumental in achieving net-zero and decarbonization targets. To overcome the challenges being faced by the industry, it is essential to foster collaboration with the workforce and deploy the latest technology. By involving employees throughout the technology development process and highlighting the benefits of modern technology, operators can create a culture of innovation and inclusivity that attracts and retains top talent.