Transforming insight into action with business event processing

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1 IBM Software WebSphere IBM Business Process Management December 2009 Transforming insight into action with business event processing Using specialized tools and frameworks to generate smart grid solutions

2 2 Transforming insight into action with business event processing Contents 2 Executive summary 2 Building a smarter grid 3 The SAFE framework 7 Beyond the grid: facilitating insight between functional areas and supporting applications 8 Conclusion 8 Why IBM? 8 For more information Executive summary Market forces are creating an increasingly unpredictable landscape around the world, requiring Energy and Utilities (E&U) companies to redefine their processes and transform their business models. Climate change and the environment have become enduring policy priorities. E&U leaders must continuously adapt to new necessities born from a growing demand for green energy and the need to operate a smart, bidirectional network. At the same time, consumers are demanding a new and direct role in personal energy management and conservation. Internally, E&U leaders face sometimes conflicting pressures to provide better and more innovative customer service; keep rates low; and increase operational efficiency and workforce productivity to deliver higher quality, more reliable utilities (electricity, gas, or water). Increasingly, industry leaders are looking to implement new business solutions to help them relieve these mounting pressures. While technology is not a panacea for all these evolving industry issues, more and more E&U leaders are recognizing the vital role that technology can play in building a smarter, more efficient and more profitable operation. Indeed, a major 2009 Survey of E&U chief information officers (CIOs) showed that 62 percent of CIOs in high-growth E&U companies actively integrate business and technology in order to innovate, versus only 41 percent in low-growth companies. In this white paper, we ll explore the various ways technology and technology frameworks can help E&U leaders build a smarter grid to help meet the industry s unique challenges and protect the world s power and energy supplies into the distant future. We ll also discuss the ways business event processing (BEP) can help E&U leaders manage instrumented and intelligent utility networks. Building a smarter grid To deliver power more responsibly and more efficiently, smart energy and utilities organizations are working toward the goal of creating a smart grid. Smart grids use sensors, smart meters, digital controls and technologies to detect, respond and analyze real-time information as a means to automatically monitor and control two-way energy flow and allow consumers to manage energy usage right down to the individual networked appliance. According to a recent study, 62 percent of CIOs in high-growth E&U companies actively integrate business and technology in order to innovate, versus only 41 percent in low-growth companies. IBM New Voice of the CIO study 2009

3 IBM Business Process Management 3 A smart grid can help energy and utilities companies better understand their power demand in near real time, so they can improve delivery and dynamically incorporate energy from different sources. These capabilities support greater use of more sustainable energy sources, such as wind and solar generation, and will help meet rapidly growing energy demand around the world. With information about their consumption and automated energy management tools, consumers can proactively manage their energy use and choose sources of power. With smart grids, energy companies will be able to detect a power outage instantly, pinpoint its exact location and cause, reroute power, and inform users when power will be restored. plant operations, mobile workforce management, asset lifecycle management, smart metering, grid operations and customer care. By integrating and optimizing assets, devices, networks, servers, applications and data throughout the enterprise, utility companies can drive business agility and smarter networks. Each utility company can leverage the SAFE Framework to build unique roadmaps for transformation. The framework approach can help increase the reuse of assets for each successive project, improving return on investment (ROI) and speed of implementation. The SAFE Framework strengthens line of business and IT collaboration by supporting seven software capabilities critical to smarter energy and utilities solutions: The SAFE framework To help E&U companies formulate and implement their smarter grid goals, IBM has developed the IBM Solution Architecture for Energy and Utilities Framework (SAFE). The SAFE framework is a platform to help integrate, manage and optimize utility systems, inclusive of assets, devices, networks, servers, applications and data driving business agility and intelligent network transformation. It combines industry knowledge and standards; best practices; and the IBM software and solution accelerators that energy and utilities companies need to bridge the gap between their business and IT requirements. The SAFE Framework can help E&U companies: Reduce operating costs Accelerate deployment of intelligent network programs (like smart grids) Provide energy management tools to consumers Limit security threats The framework brings together the vast capabilities of IBM s industry experience, technology and support to power smarter utility solutions throughout all areas of a utility, including Asset, device and service monitoring Asset life-cycle management Informed decision making Improved customer experience Business process automation Regulatory, risk and compliance management Security solutions Solution Architecture for Energy and Utilities Framework Third-party Access Domain Utility Business Domain Regulatory, Risk and Compliance Management Transmission & Customer Operations Power Generation Distribution Customer Management Plant Operations Customer Care Mobile Workforce Management Fleet Management Customer Systems Asset Lifecycle Management Supply Expansion Supply Chain Management Improved Customer Experience Asset Lifecycle Management Intelligent Utility Network (IUN) Corporate Support Services Human Resources Accounting Payroll Smart Meter & Beyond Grid Operations Security Communications Network Plug-In vehicle/distributed Energy Resources Informed Decision Making Business and infrastructure integration layer (Services Oriented Architecture) Business Process Automation Asset, Device and Service Communications network domain Monitoring Device domain Figure 1: The IBM SAFE Framework S e c u r i t y S o l u t i o n s

4 4 Transforming insight into action with business event processing Business Event Processing Maximizing E&U information value An integral component of the SAFE framework is the ability to harvest rich and actionable information from a variety of sources using business event processing (BEP). BEP is the ability to detect and respond to patterns of activities known as events occurring throughout the enterprise. An event is any electronic signal, or message, indicating a change in the state of the enterprise. For example, a certain pattern of events could indicate an outage, meter tampering, suspicious or illegal usage, the addition of a new customer, a downed power line or the current location of an asset using global positioning system (GPS) technology. BEP tools offer the ability to track and analyze millions (or even billions and trillions) of events that occur across the network each day as they happen and eliminate the traditional latency of analyzing and responding to actionable situations. Using BEP tools, E&U companies can correlate meter outage events from different customers to identify patterns in the information, which can, in turn, help identify the geographic scope of an outage. Additionally, based on the severity of an outage, BEP tools can automatically identify and help initiate one or more appropriate response actions. Such actions could include dispatching repair teams to resolve the issue or promptly communicating with customers about the issue through customer-defined preferred channels such as or cell phone text message. A business event includes any electronic signal or message indicating a change in the state of the enterprise. Using the SAFE framework for informed decision making Though all seven software capabilities enabled through the SAFE Framework apply to the E&U industry, this paper will focus on the one area that is most critical to business event processing solutions informed decision making. As the rate and pace of change to utility systems and technology increases, informed decision making becomes key to continuing success. Companies that can understand the business relevance of complex patterns of events and respond at the right time can realize improved business flexibility and performance. Using the SAFE framework and BEP tools such as WebSphere Business Events, E&U companies can realize informed decision-making capabilities in all aspects of their operations. They can also implement business process automation using business process management (BPM) solutions such as IBM WebSphere Business Monitor to boost insight, and WebSphere Process Server to help transform that insight into action. Such capabilities can help E&U companies optimize their tools and workforce to save time and money and meet strategic business goals. The SAFE Framework helps put the intelligence in the Intelligent Utility Network. Tools and features within the framework include: IBM WebSphere Business Events (WBE) helps E&U leaders advance their informed decision-making capabilities, enabling greater efficiency, agility and competitiveness. IBM WebSphere Business Events helps businesses detect, evaluate, and respond to the impact of business events based on the discovery of actionable event patterns. The solution: Improves line-of-business insight and awareness of actionable business situations in a more timely fashion Enables business users to define and manage logic related to business events

5 IBM Business Process Management 5 Reduces total cost of ownership (TCO) through codeless implementations, enacted by business users, often without incurring IT development or implementation costs Provides the ability to detect, decide, and dynamically react to simple and complex relationships between people, events, and data Increases business agility by enabling faster responsiveness to customers, suppliers, and changing market needs Reduces TCO for composite applications requiring the combination of event pattern detection, traditional workflow, and activity monitoring functionality Enhances existing BPM and service-oriented architecture (SOA) infrastructures IBM Cognos Helps optimize business performance, organization and planning with a complete range of business intelligence capabilities, including reporting, analysis, dashboards and scorecards ILOG Provides optimization, visualization and decision making technology to improve utility operations and planning. The solutions helps address complex problems throughout the utility with optimization tools for power system resource planning, generator scheduling and risk management; fuel supply, transport and storage; grid planning and management and crew and maintenance scheduling. IBM Cognos Now! Provides real-time solutions for measuring and analyzing utility sensors, meters and energy loads to increase efficiency of operations, allowing utilities to continuously measure and identify time-sensitive key performance indicators (KPIs) for immediate notification. The solution was designed for rapid deployment and low total cost of ownership and helps utilities proactively track and respond to operational metrics with minimal IT intervention. Information Management Portfolio The portfolio enables E&U companies to integrate disparate data and systems and provide meaningful information and insights to the utility s various stakeholders. The portfolio provides the foundation for transforming from a siloed environment to a unified data warehouse model that offers a single version of truth throughout the organization. Smart grid use cases The use cases below illustrate how a using IBM WebSphere Business Events as part of a smart grid solution can help E&U companies face and overcome some of their most difficult and costliest problems in the areas of power outage and tampering detection, customer communication, and fraud identification and prevention. Detecting outages and improving customer communication: Utilities face growing pressures to proactively identify and resolve power outages quickly as well as to improve the speed and quality of their communications with customers needing outage impact information and status updates. WBE can help automate outage detection, so E&U companies no longer have to rely on customer reports to begin working to restore service. The benefits of agility in both outage identification and customer communication can provide companies with tangible financial and operational benefits, including reduced outage remediation time, reduced agent workloads, increased customer satisfaction, and decreased call center volume. With a smarter grid, E&U companies can more easily detect outages, identify tampered meters and pinpoint areas of unlawful energy usage.

6 6 Transforming insight into action with business event processing Tampering: grid security Meters that have been tampered with carry a significant risk of fire. Additionally, unidentified meter tampering can result in incorrect readings which, taken cumulatively, can cause consumers to be inaccurately billed (or not billed) and can lead to significant losses to the utility. Therefore, rapid identification of compromised meters is critical. WBE can correlate disparate events from different systems to identify patterns that need to be acted upon. For example, the detection of significant usage variations over a short period of time or comparable time period can be flagged as a potential meter tampering event. WBE can identify and analyze this pattern of events to determine and initiate the correct response, including informing the utility of a potential fraud event or dispatching a crew to check the affected meter. Companies with the ability to quickly identify and rectify meter tampering situations can significantly reduce the number and scope of losses due to this costly issue. Identifying unlawful usage of energy Another area where WBE can use event analysis and correlation to quickly reach conclusions that would otherwise be extremely difficult is in identifying unlawful energy use. By correlating historical and current usage, utilities can detect significant differences that could indicate unusual activities. Once verified, law enforcement can be notified for investigation. Company boosts customer satisfaction and efficiency A large energy delivery company wanted to improve their customer service and boost their image by providing timely estimated time of repair (ETR) updates during an electrical outage to customers who subscribe to this service via or text messages on their cell phones. The company wanted to use a third-party service that would take the relevant messages and send out status updates. The company needed a complex event processor and/or rules engine to monitor and look for outage events, and then respond to these events accordingly. To meet their needs the company implemented a solution based on the IBM WebSphere Business Events solution. The WebSphere Business Events software automated and customized the communication process for each participant. Now, when the engineering department makes outage status updates to its database, the IBM solution monitors, detects, evaluates and responds accordingly. The company now has a complete communications service that delivers ETR updates to its energy subscribers. The new solution successfully improved customer satisfaction and customer service levels. The system enables engineers to successfully change system and communication rules without having a deep understanding of the IT infrastructure. Additionally, the solution facilitates significant cost reduction, reduced development times, and reduced development and maintenance complexity.

7 IBM Business Process Management 7 Large energy provider saves time and money with smart grid solutions A large domestic energy provider in the U.S. delivers natural gas to 3.2 million residential and commercial customers in six states and delivers electricity to more than 2 million residential and commercial customers in a 5,000 square-mile service area. The company wanted to implement smart grid technologies to enable them to manage their systems in near real time and enhance customer service. To do so meant overcoming several challenges, including: connecting siloed operations, integrating legacy systems, and implementing a more modern infrastructure and smart meter technology in order to process and act on real-time data inputs. Beyond simply tracking events that happened, company experts also wanted to know what events didn t happen, including the ability to detect the following: Node failure Nonpayment of a bill Meter tampering Meter outages during power switchover To meet these challenges the company implemented IBM WebSphere Business Events, Business Monitor to track and analyze events and IBM Tivoli Netcool OMNIbus and Impact to monitor, detect, correlate, respond and process smart meter events, node availability, and customer usage/billing. The company has realized numerous benefits from their smart grid implementation and upgrade, including: Cost and time savings as a result of increased automation and streamlined business processes Improved communication and customer service capabilities the company can now pinpoint outages before customers calls to report them Accelerated add and modify capabilities that analysts can use for maintaining filters, alerts and notifications Quick and easy integration of new event and data sources Beyond the grid: facilitating insight between functional areas and supporting applications Beyond the smart grid use case applications outlined in the previous section, business event processing and the SAFE framework can enable E&U companies to easily and efficiently solve problems, gain insights and implement solutions that would otherwise be too cost or labor intensive to pursue. WBE and other tools within the SAFE framework can integrate data from traditionally isolated and disparate systems for fast and easy analysis as well as enhance communication and messaging capabilities. Examples of potential beyond-the-grid functionality include: Correlate smart meter information about customers energy or utility usage with Customer Information System (CIS) data such as household income, average bill amount, building type, square footage, etc., to identify potential sales targets for new or upgraded products and services. Cross reference usage data with CIS or financial data to quickly identify customer groups who may need financial assistance or meet other specialized criteria. Aggregate customer, financial and usage data to quickly determine if a tamper alarm is associated with a high value or commercial property and optimize response protocols accordingly. Integrate billing data with call center information and disconnection order data to enable near-real-time communication between systems, E&U representatives and E&U service truck drivers. These tightly integrated communication capabilities can help ensure timely shutoffs, as needed, and help prevent improper truck dispatch or customer shutoff when eligibility changes. Help boost customer satisfaction by offering consumers customized information about their bill, including line-item charge explanations and personalized information about which services or appliances cost the most and how to save energy.

8 Conclusion Business event processing tools and technology frameworks can help E&U leaders meet the unique needs of their industry. Building a smarter grid can help these companies both nearand long-term by optimizing operations and boosting customer satisfaction as well as laying the foundation for intelligent, instrumented and interconnected smart utility solutions that will serve them for many generations to come. Why IBM? IBM has a proven track record in helping Energy and Utilities companies meet their smart grid and business event processing needs and position themselves for the future. Our SAFE framework helps E&U companies realize their business objectives faster, reduces total cost of ownership, and hastens return on investment. For more information For more information about smart grid solutions from IBM, contact your IBM representative or visit: ibm.com/energy ibm.com/bpm/insight-action Copyright IBM Corporation 2009 IBM Software Group Route 100 Somers, NY U.S.A Produced in the United States of America December 2009 All Rights Reserved IBM, the IBM logo, ibm.com and WebSphere are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with a trademark symbol ( or ), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at Copyright and trademark information at ibm.com/legal/copytrade.shtml. Other company, product and service names may be trademarks or service marks of others. References in this publication to IBM products and services do not imply that IBM intends to make them available in all countries in which IBM operates. Please Recycle WSW14107-USEN-01

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