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IDC Energy Insights Flags Important Priorities for Utilities

Top Line: Utilities are making a good job of doing more for less, but longer-term strategic imperatives are equally important

(PresseBox) (Frankfurt am Main, ) IDC Energy Insights has recently published its "Business Strategy: CIOs Priorities - IT Solutions -Western European Utilities Survey 2011" report (#EIOS07T, November 2011). Key findings include the fact that security technology solutions will continue to be a key investment area in the near future, with almost nine in ten organizations investing in these areas. Storage software, unified communications and ERP are also high priorities. Over the next year, the highest priority line-of-business solutions for investment will be customer care, asset management network automation and control.

Bottom Line for ICT Buyers:

1. Utilities have generally done a good job of optimizing their assets by doing more with less. Nonetheless, they should think beyond short-term cost cutting and look for longer-term opportunities to make technology investments that support business strategies and goals, chiefly in areas including energy efficiency and demand response, intelligent grid, renewable energy, and carbon management. Simultaneously, cloud and managed services offerings need to be considered as options to reduce capex and/or opex.

2. Utilities CIOs need to elaborate a highly selective IT strategy grounded on a deep understanding of future needs and the existing IT landscape to set IT on the right course for the immediate and long-term future. To do this, they must strongly collaborate with LOB (Line of Business) executives and jointly develop clear business cases to evaluate total cost of ownership of different solutions. Moreover, participation in business case discussions and intelligent grid budget allocations should be done early. Understand that there will be a need to work closely with business unit engineers to integrate data from operational technology such as SCADA and EMS with other IT applications.

3. Most importantly, utilities CIOs should consider a critical and profound revision of their enterprise information architecture. Industry-wide trends such as unbundling, changing business objectives and the increase of digital devices (not only smart meter but all sensors, intelligent home devices, as well as electric vehicles) are driving significant increases in the volume, velocity, variety, and value of data that is going to be generated by utilities. This data could potentially generate great value to utilities. It could be time to act not on single applications, but rather on the integration of platforms and on master data.