Embracing the cloud – why utilities needs to get flexible
The only certainty in the world at the moment is that nothing is certain at all.
In the utilities sector this point is particularly pertinent.
Utility Week recently predicted that the industry will look entirely different by 2030, fuelled by the impact of climate change, changing regulation, increased competition and a rapidly rising population.
The publication argued that while traditional utilities brands will still have a place, they may need to reinvent themselves in order to survive.
For utilities firms this is as exciting as it is terrifying, particularly the larger organisations with legacy IT infrastructures to contend with – for whom any significant change is a slow and steady process.
To prepare yourself for this as-yet-unknown future, you need to achieve greater agility and flexibility without completely overhauling your existing IT infrastructure.
And the only way you can do that is by switching to a cloud-managed approach.
Why take a cloud-managed approach?
Utilities firms have been using business applications like SAP for years – tools to move information around the organisation between various different systems.
But traditional, non-cloud-based databases have a fundamental flaw: they don’t allow for large surges in demand or the need for rapid change.
That ability to flex quickly is becoming increasingly important in the utilities world.
The factors I mentioned above – climate change and evolving regulation, for example – mean utilities companies are already being forced to think about opportunities beyond their traditional business models and find new ways to stay competitive.
Operating a cloud-managed environment means you can create new functionality quickly and easily as you don’t need to change or build new hardware every time.
And the fact you can test out new apps with relatively little up-front financial time investment means the risks involved in trying something new are reduced.
The ‘as-a-service’ world
In the IT world we tend to talk about everything ‘as-a-service’ these days. But behind the buzzword is a new way of doing things that enables organisations to achieve the flexibility they need.
The ‘as-a-service’ model means you can use whichever modules of a business application suite you want, when you want them.
In the case of SAP, for example, which has hundreds of potential modules, your company may only need 20 or 30 of them at any one time. Operating a cloud-based, as-a-service model means you can pick and choose the modules you need based on evolving business needs.
And when you don’t need a particular module or app anymore, you simply stop using it.
It’s a massive shift from the old ways of corporate IT, where significant changes required a relatively large overhaul of IT infrastructure and were much harder to undo once implemented.
With a cloud-managed environment, you have the flexibility to test the waters and scale up or down when they want.
Not only can this help you better serve your customers now, but for an industry like utilities where disruptive newcomers are predicted in the coming years, it means you’ll be more ready to fight of fresh competition.
Low risk but huge rewards
Of course, moving your infrastructure to a cloud-based model isn’t completely without risk.
The main questions we get asked when approaching this is: will my systems have to go down, and for how long?
In utilities this is a particular worry.
It’s one thing closing an online retailer’s website at three in the morning when most people aren’t likely to be shopping for shoes. But for service companies that are ‘always on’, there’s never a good time to go down.
So yes, there are risks. But there are things you can do to reduce them significantly.
Firstly, work with a supplier that already has experience carrying out large-scale migrations of this kind.
Our ‘near zero downtime’ approach has helped us carry out more than 300 SAP migrations into the cloud.
The principle is simple: create and isolate a clone of current live system that runs parallel with it. Then synchronise data between the two systems and only switch over fully to the new system once it’s fully tested and all stakeholders are comfortable with its functionality.
This means no loss of data and no downtime.
It’s also worth noting that the risks involved in not moving to a cloud-managed environment are arguably much greater.
The resulting savings in costs and time, and the massive increase in flexibility, far outweigh the dangers involved in the transition.
And if you choose not to make that change (or don’t do it soon enough), your competitors will enjoy those benefits before you.
You can’t predict the future, but you can prepare for it
In-memory computing will bring a huge number of opportunities in future, and if you’re operating a cloud-based environment you’ll be able to take advantage of them more quickly and with relatively lower risk than you otherwise would.
You’ll be able to embed new functionality in your old systems without having to reinvent your whole infrastructure.
All those legacy restraints that have historically held back the traditional utilities brands will be gone.
Take Google as an example. It makes fundamental changes to its platform on a regular basis, but those shifts don’t require enormous investment in new people or systems – it simply rewrites its algorithms.
Google can operate like that because its underlying infrastructure allows it, and it’s the same principle with moving to a cloud-managed IT environment.
But while I’ve focused mainly on the flexibility benefits, the data analysis power the cloud provides is also significant.
Having all your assets connected to the cloud means you can quickly gain insights about what’s happening out in the field and across your business and use them to make changes.
For utilities this is huge. With so many assets out in the field – whether that’s pylons or underground pipes and wires or a technician’s wearable device – there is a huge amount of data to track and make sense of, and a cloud-managed approach makes it much quicker and easier to do that.
As I said at the beginning of this article, none of us really know what’s coming in the next 5-10 years. But what you can do is make your business flexible enough to adapt to any changes that do come, whatever they are, without being slowed down by legacy systems and processes.
We may not be able to where we’re headed, but at least we can build an infrastructure to cater for whatever we find when we get there.
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- Embracing the cloud – why utilities needs to get flexible - June 22, 2017