Getty Images
Getty Images 1070427216

Math Behind Measuring Business Value for EU&R Organizations

May 6, 2020
The challenges to track, measure, optimize operational performance and financial control in the EU&R sector are like no other.

From a business and operations perspective, there are a number of key similarities in the way energy, utilities and resources (EU&R) organizations operate. They must all deal with a large number of assets and equipment while managing an extensive workforce scattered across multiple sites with varying skillsets, often supplemented by contractors. Effectively keeping track and measuring the performance of this vast network of assets and personnel is critical to ensuring productivity and maintaining profitability. But against a backdrop of extreme industry volatility and at such a scale, this impossible to manage manually.

This is where business software has come to the fore to support key operational areas. The information it provides, even at the smallest level, has significant benefits — including keeping assets operational for as long as possible, driving the efficiency of the workforce, and ultimately increasing the bottom line.

The Rule of Three for Weathering the Storm

In early 2020, Deloitte published a report that said, "New technologies, evolving customer preferences, and the changing competitive landscape are leading many power companies to explore new business models."

The current EU&R market climate means organizations are having to reassess the plans they had in place for 2020. But exploring any new business model or changing an EU&R workforce means being able to accurately measure success and failure. This is where enterprise software comes into play, particularly when it has been designed with EU&R market volatility in its DNA. IFS has a long history in supporting the business strategies of some of the leading EU&R organizations in North America, including Brookfield Renewable Partners, Trans-Northern Pipelines, Covia Corp., and Hecla Mining.

This is why IFS recently commissioned IDC to find a comprehensive view of the key areas its EU&R customers have focused on and the critical metrics they have tracked when deploying enterprise software. To gauge an industry overview, the study polled customers with similar pressures, such as the need to handle key assets/equipment, manage a diverse workforce, and gain visibility into key operational processes.

The results made it possible to track the common key pain points these EU&R organizations focus on and the measurable advantages they have unlocked through enterprise software deployments.

One: Bolstering service scheduling delivers a better customer experience

One of the fundamental revenue streams for EU&R organizations delivering power to end-customers is through in-field assets or dispatching engineers to homes for installations and repairs. This is often the only face-to-face interaction customers will have with their utility or energy provider. Customer experience is king here, so tracking metrics such as first-time fix rates, SLA adherence, minimizing travel, and meeting appointments on time are key.

Just scheduling the manpower and resources needed to guarantee such a high level of customer experience cannot be a static or manual process. Dynamic scheduling built into a software solution can provide immediate workflow improvements. This is where the IDC report highlighted some key metrics IFS customers reached through dynamic scheduling of their field technicians.

Across all the industries IFS serves, customers reported completing 28% more work orders and improved delivery speed on orders and products. Not only does this mean end-customers are benefiting from improved service, but organizations are also increasing their speed of task completion and driving revenue. This would be an everyday occurrence once dynamic scheduling is incorporated into field operations. An EU&R organization describes, "We're seeing big savings with IFS in scheduling activities. Before, it would take a couple of days, and now it takes minutes because it's basically self-service. This happens every day for the field service team."

Two: Sweat the assets with better management of each

EU&R equipment requires significant investment to buy, operate, and maintain. This is a critical contributing factor to almost all EU&R business success and profitability.

Critical assets in EU&R can span anything from organizations operating ports and relying on complex, modern installations with fully automated assets to offload and transport containers and bulk goods, right through to a company in power generation or oil and gas, where assets are directly linked to safe and reliable plant operation.

In the IDC report, analysts found that many IFS EU&R organizations have successfully managed to extend the service life of key assets and increase up-time and availability. A customer highlighted better asset, part, and workforce tracking as improving maintenance of equipment, saying, "The software helps us extend the lifespan of capital assets. I think it's around 10% to 15% longer because of higher maintenance quality and assessments." Other metrics include improved use and operational efficiency, from 80% up to the mid 90% bracket.

Three: Mining data across the enterprise builds a company-wide operational picture

EU&R organizations can make all the operational changes they like, but they will be in vain if they can't consolidate all this good work and connect vast information streams into a core enterprise system of record.

Consider an EU&R organization operating across the entire United States or even the whole continent of North America. Building one, unified picture of the business is difficult when there are tens of thousands of assets and divisions located in hundreds of geographic locations.

On top of this, it's common for many EU&R companies to try and knit together systems for different processes — often for historical reasons such as mergers and acquisitions (M&As) or selecting point solutions for specific problems as a company has grown.

With an enterprise-wide solution specialized for EU&R, IFS customers reported to IDC that they can manage assets, projects, and services alongside human capital management, finance, supply chain in a single instance. In fact, when it came to planning business budgetary cycles, IFS customers across multiple industries cited they had quickened by over 20% on average.

EU&R Organizations Must Answer Some Tough Business Questions

The challenges to track, measure, and optimize operational performance and financial control in the EU&R sector are like no other. EU&R organizations have to balance high-value capital assets and a huge workforce against a volatile and changing market climate, making it difficult to identify the impact of every asset, worker, and contract. But — with a little help from their software implementations — there are some industry trailblazers setting the bar for performance measurement.

Voice your opinion!

To join the conversation, and become an exclusive member of T&D World, create an account today!