Last Updated on September 14, 2022
As Bob Dylan sang, “The Times They Are A-Changin’,” and the utilities industry is feeling the heat, so to speak, more than ever before. An industry that is traditionally change-averse has found itself in a state of transformation in recent years due to a number of market, operational, and workforce changes.
To stay ahead of the curve, steady-state and slow-moving approaches of the past must evolve into proactive, nimble, and digitized service models for the future. But the real challenge is ensuring transformational change succeeds, which is no small feat when more than 70 percent of programs fail.
Pressure to Transform
There are a number of internal and external pressures contributing to a need for transformation within the utilities industry, including changes in customer demand, pressure to improve performance and mitigate the rising cost of energy, regulatory changes, an aging workforce, dated infrastructure, and a push to diversify energy sources.
To support a transitioning workforce, improve customer service and enhance operational efficiency, utilities are swapping quasi-automated systems and processes with new ways of working and innovative digital technologies such as smart grid, advanced metering infrastructure, meter data management, distributed energy sources, enterprise data management, and workforce management systems.
In the last 5 years, the utilities industry has undergone more change than it has in the previous 20. It’s not uncommon for a utility company to implement multiple new technologies at one time that affect frontline employees. So how does an industry that is slow to adopt change successfully navigate through continuous change?
Understand the Type of Organizational Change
For change to be successful, utilities must first understand the type of change it is undergoing. There are three types of organizational change:
- Developmental – Most traditional project and change management plans address developmental and transitional changes. Developmental changes are the simplest in that they improve upon what an organization is already doing – a work process improvement, for example.
- Transitional – Transitional changes replace the current state with a new state. New products or services and system implementations that do not require significant shifts in mindset or behaviors are examples of transitional changes.
- Transformational – Transformational changes, however, are the most complex because the future state and current state are drastically different and often involve changes to processes, technology, organizational structure, and people. Additionally, at the onset, the future state is not fully known; rather, it evolves over time, which equates to high levels of uncertainty because it requires operating in the unknown.