The Power of Innovation, Part 1

Deck: 

Utility Execs' Roundtable: We sat down with seven utility execs who lead their companies on innovation

Utility Execs' Roundtable: We sat down with seven utility execs who lead their companies on innovation

Fortnightly Magazine - January 2017
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The electric utility industry has recognized that its future will look much different from its past. An environment where disruptive technology establishes opportunity and customer behavior defines necessity. It drives a fundamental reshaping of how the industry positions itself to meet these challenges.

To address this market shift, industry executives have begun to communicate internally about the importance and value of innovation within their companies. Executives have also been tapped to "stand-up" organizations to enable these companies to adopt the kinds of practices long embedded in industrial and consumer products companies.

Utility Execs' Roundtable

Strategy& and Public Utilities Fortnightly recently collaborated on an Innovation Roundtable in Washington, D.C. at the offices of the Edison Electric Institute.

Tom Flaherty, Bert Valdman, Chris Gould, Sasha Weintraub

The experiences of these senior executives convey insights attained through the hard work of creating their unique innovation platforms. For other companies just now forging their own ways to innovate, these insights can accelerate program development. And harness a collective experience that can eliminate false starts and costly failures.

Meeting the Innovation Challenge

Executives in the electric utilities industry appreciate just how hard it is to recast a company's go-to-market philosophy and business model in a period of uncertain market evolution. But they know they cannot stand still while their market environment changes in ways they have never experienced.

The executives acknowledge that the marketplace is evolving in ways that will challenge their ability to sustain the type of presence - mind-share or wallet-share - that they historically enjoyed.

EES North America

Even with this emphasis on innovation within their businesses, the executives know that customers are signaling broader expectations from them. And these expectations are no different than those embraced by customers from the many other providers with which they also engage.

The companies are positioning their innovation platforms to extend linkages to the customer and enhance customer relationships. These relationships are moving beyond simple service interfaces, to complex interactions where customers are able to influence - if not control - how energy is used, provisioned and priced.

Building adaptable innovation platforms means that companies need to come at customer challenges differently and change the focus from why to why not. And companies will now need to move beyond asking whether to enter a market, to how fast can we be in the market.

The executives agree that thoughtful and sustainable innovation platforms are a table stake for future success. These platforms will need to be adept at ideation, technology evaluation, market deployment, value propositions, enterprise collaboration and commercialization.

As business complexity increases, commercial and industrial customers will seek to exert more control over energy supply, costs and reliability, and obtain more services to support this outcome.

Residential customers, on the other hand, will seek more unique options for themselves. These customers will entertain simpler, but more valued relationships with their provider - the incumbent or a new type of entrant - to ensure that their energy consumption and selection decisions are optimized.

The executives recognize that today's

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