This document discusses opportunities for digital transformation in the utility industry. It summarizes that digital channels should be adopted similarly to other industries, but utilities often rely on piecemeal approaches. Today's customers expect basic digital functions like billing, usage viewing, and service requests. Analytics can also help utilities improve operations through insights from customer data and IoT. However, utilities face challenges like attracting digital talent and keeping pace with changes. Cybersecurity is also important as utilities are considered critical infrastructure that is highly regulated.

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Hack Heyward
Bob Lutz
Digital Transformation
Opportunities Heat Up
for Utilities

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Digital Channel Adoption and its Impact on Satisfaction
Digital Channel Investment: What’s the Payoff for the Industry?
Analytics: The Key to Deep Engagement
Cybersecurity: What the Industry Has to Get Right

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Digital Channel Adoption
and its Impact on Satisfaction

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Digital channels for the utility industry should
not be different from other industries.
 Website
 Email
 Chat
 Mobile apps
 Social media
 Text messaging
Yet … current efforts to
digitize utilities often rely on
bolt-ons and incrementalism
that result in uneven
customer experiences.

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Today’s consumers expect utilities to
digitize basic capabilities so they can:
 Receive and pay bills
 Inquire about high bills
 Arrange for move-in / move-out
 View usage patterns
 Compare their bill to others in their
area

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And utilities need to digitize basic
internal functions, including:
• Turn on/turn off/transfer service
• Leverage advanced metering
infrastructure (AMI) capabilities

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Going digital will effect everyone
who touches utilities.
Digital can help utilities:
• Retain customers
• Improve how regulators view them
• Report outages, downed lines, etc.
• Reduce call volumes to contact centers.

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Digital Channel Investment
What’s the Payoff for the Industry?

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Customer satisfaction is increasing steadily
with digital channel usage.

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Digitally Delivered Customer Alerts

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Digital channels have the potential to
displace inbound call volume.

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Analytics
The Key to Deep Engagement

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The customer experience must be a digital
experience.
To add value, utilities need built-
in analytics that tailor content and
service suggestions based on:
 Customer preferences
 Demographics
 Patterns of behaviors.
As a consequence of
M&A, utility decision-
makers are further
removed from the
customers and
communities they serve.

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Operational insights, perhaps less visible,
provide the greatest ROI.
Leveraging IoT, analytics can transform utility operations by enabling:
 Demand forecasting based on usage granularity never before possible
 Evolving costly and wasteful preventative maintenance to predictive
maintenance
 Rapid changes t demand equations … peak pricing, time-of-use rates
or electric vehicle charging impacts.

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Legacy functionality and internal
skill sets fall short.
Utilities are struggling to:
 Attract and retain “new media” expertise
and data scientist skill sets
• Keep pace with the change of digital business.
Current utility-oriented ERP vendors (SAP and
Oracle) also struggle to keep pace.

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Cybersecurity
What the Industry Has to Get Right
What is CIP-6 and why is my client talking about it?

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Why is cybersecurity an issue?
• The US Department of Homeland Security
identified utilities as “Critical Infrastructure.”
• Cybersecurity regulations cover the entire electricity
grid, from the power plant to the user.
• All utilities that have retail operations are subject to
regulations.

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From a security perspective, utilities may
start looking more like the public sector.
What will this mean for service providers?
• A core competency of utilities is meeting regulations.
Expect a higher level of scrutiny of your security approach.
• Security may be outsourced separately to a specialist.
Can you play well with others?
• RFPs will have specific security questions.
Be sure to document how you fit into the utility’s CIP program.

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Expect RFX documents from utilities
to require a cybersecurity plan.
Prepare to address:
 Personnel and training practices
 Cybersecurity awareness programs
 Information protection programs
 Incident reporting and response planning
 Incident response recovery
 Configuration change management and vulnerability
assessments
 Recovery plans

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What about the cloud?
 Utilities will continue to be cautious with respect to core
infrastructure.
 Administrative, customer and analytics functions will be
more likely to accept shared infrastructure solutions.
 Nuclear and SCADA will likely remain “hands-off.”
But, remember, the breadth of your cybersecurity
solutions is difficult for any utility to match.
So … be proactive in raising the cybersecurity topic.

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