may be less than healthy, unless you're ready to replace them with technology.
As competition intensifies, increasing numbers of executives are realizing that customer service may have a more important role now than just placating regulators. After all, the broad spectrum of customer service is the principal way (em other than rates (em to differentiate a utility product and the utility itself.
Executives face the added pressure of trying to maintain profitability to retain shareholder value. One popular way to do that has been through downsizing, a process that has cut thousands of jobs and selected assets from the electric, natural gas, and telecommunications industries in recent years. One of the most recent and most dramatic downsizings: AT&T and its decision to cut 40,000 jobs during 1996 for competitive purposes. Reported job cuts in the telecommunications industry are approaching 200,000 positions.
Eliminating mid-level utility managers helps strengthen the bottom line of electric, natural gas, and telecommunications companies in the short term. In the long term, however, the loss of these positions could create a decision-support vacuum (em a missing link in the communications channel between upper-level managers, field service crews, business unit managers, and customer representatives. This vacuum represents a downside of downsizing.
Many utilities have built a wide array of information technologies in recent years. The key problem is that these systems in the past counted on people linkages and have not been integrated as systems per se. The individual technologies have not been able to talk to each other, and so fall short in helping to support decisionmaking. At the same time, downsizing has eliminated many of the mid-level managers who formerly did this work. As a result, integrating and/or upgrading information systems so that they "talk" to one another is increasingly critical. Information technology tools known as spatial information systems can enhance executive decisionmaking.
Spatial information systems, and related technologies known as Geographic Information Systems (GIS) and Automated Mapping/ Facilities Management (AM/FM) systems, have gained widespread use among utilities in recent years. The reason is straightforward: This technology is a single tool to manage the technical and spatial information about facilities; their relationship to customers, products, or services; and the land environments in which they operate. GIS serves as the critical
platform for integrating key information technologies into an effective executive decision-support system.
A utility can use integrated systems with geographic analysis to support a wide variety of business issues. BellSouth Telecommunications Inc., West Ohio Gas Co., and Kentucky Utilities Co. are three different, yet representative, utilities that use spatial information systems and GIS to support their business goals and address a variety of reliability, customer service, and emergency response issues.
BellSouth Telecommunications. BellSouth Telecommunications Inc. (em the nation's largest regional Bell operating company, with more than 21 million local access lines (em is automating its manual outside-plant engineering and design processes throughout its nine-state territory. The
company's fast-track Outside Plant Engineering and Design System (OPEDS) will integrate BellSouth's information repositories and automated facilities management systems into a single corporate-wide database. This database will identify all current outside plant locations and streamline online planning and design work for new service provisioning.
The spatial information system being installed at BellSouth will permit the utility to rapidly and extensively upgrade its telecommunications infrastructure as its business grows. A parallel system will estimate the cost of new installations as engineers design them. In short, BellSouth will be able to speed up its response time to requests for new service. Speedy response time offers not only significant competitive advantage, but also a long-term commitment to providing superior customer service.
West Ohio Gas. Like many local gas distribution companies, West Ohio Gas is expanding its service territory and improving its customer service. The company's strategy is to adopt information systems that enable better decisionmaking, help the utility control costs, and allow it to spend operations and maintenance dollars more wisely.
Over the past two years, West Ohio Gas has implemented a new system, conceived and designed as an enterprise-wide information management solution used by virtually every business unit. Among the software applications being developed are DOT reporting and analysis, pressure control and analysis, customer complaint tracking, and emergency response. The emergency response application helps utility work crews trace through the natural gas network model to identify critical valves in the event of a leak.
Kentucky Utilities Co. As one of
its business strategies, Kentucky Utilities decided to use information technology to improve its trouble-outage management capability, contain the operational costs of growth by increasing labor efficiency, and provide more accurate and timely information to enhance customer service.
Senior management recognized that improved trouble-outage response was fundamental to maintaining superior customer service. The company envisioned a sophisticated system that includes call processing, outage analysis, outage status information, troubleman/ crew management, and a one-way supervisory control and data acquisition (SCADA) interface. The core AM/FM system will provide an information foundation for the trouble outage system, providing frequent updates. A work management system will be integrated with the AM/FM system to provide tools for more effective work design, estimating, project closing, and posting that ensure accurate and timely data for operations as jobs are completed.
Implementing and integrating these technologies will enable Kentucky Utilities to achieve its corporate objectives. The improved work management system will enhance labor productivity and help employees accomplish their jobs without staff additions. The AM/FM system will manage geographic data on line and provide a valuable facilities management tool. The trouble-outage entry/analysis system will support improved outage resolution and help the company provide more responsive customer service.
The business goals at BellSouth, West Ohio Gas, and Kentucky Utilities are the same as those at virtually any progressive utility in the 1990s: to be more competitive, to be more responsive to customers, to provide reliable service, and to respond effectively and efficiently to emergencies. The difference is that BellSouth, West Ohio Gas and Kentucky Utilities are adopting "appropriate" technology tools to help them achieve their goals, and "integrating" such tools into a mission-critical, decision-support system.
The trend toward increased regulatory scrutiny of issues related to safety, reliability, and customer service is entirely appropriate given the rapid change occurring in the utilities industry. The new regulatory standard should include examining how utilities use and integrate information technologies to meet these regulatory objectives and to escape the pitfalls of downsizing. t
Glenn E. Montgomery is co-chairman and CEO of Convergent Group, which provides spatial information system consulting services and software to electric, natural gas, and telecommunications providers worldwide. James P. Spiers, a former executive director of the Colorado Public Utilities Commission, works as a consultant/
attorney in Boulder, CO.
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