Enhancing performance through insight

Transcription

1 Enhancing performance through insight Industry case study: Energy & Utilities Enterprise performance management helping our clients put information at the heart of their decision making

2 Industry Energy & Utilities Geography UK PwC Services Enterprise performance management Benefits of using PwC Achieving long term return on investment from business information transformation 2 Enhancing performance through insight

3 Business background With a history that dates back to the 1600s, Thames Water is the UK s largest water and sewerage company. The prices of Thames Water s services are tightly regulated by the Office of Water Services (Ofwat) one of eight regulatory bodies which influence and control Thames Water s business. Ofwat reviews the prices that the water and sewerage companies can charge their customers every five years. This includes challenging the capital investment propositions water companies make, proposed operating costs and the associated impact on consumer prices looking for propositions that clearly demonstrate efficiency and the best value for customers. During the last Ofwat review in 2009, which set the prices of services for , Thames Water identified a number of areas where it could drive improvement and increase confidence in its plans. In response, the organisation embarked on a transformation programme to create and deploy a new Asset Management and Operation operating model and replace its field work management information system. This investment aimed to give managers working across its large, diverse asset base the right information to improve focus on efficiency and effectiveness. We needed management information that was aligned to our new operating model from top to bottom from regulatory target to field operative activity and which drove performance management of the business. This work has delivered a new level of performance information to the workforce and to our asset planners that will help us to drive performance. Marie Linscott, Information and Data Manager Enhancing performance through insight 3

4 Getting the right information to the right people to drive business performance Thames Water approached PwC to help it transform the depth, breadth and scale of its Management Information. To do this we worked together to: Define and deliver the information executives and senior management needed in line with the new operating model principles and regulatory performance indicators. Agree practical metrics which made sense to frontline management staff working across all of the different asset types treatment works, networks etc. Automate the collection and delivery of better, more detailed operational financial information using the right reporting and data warehousing technology. In a three phase project over eighteen months, a team from Thames Water and PwC worked together on these three elements. Having achieved buy in from the Executive Team to new structures for accountability and senior management performance metrics, we reflected these in clear, easy to use reports. Once this was complete, the team turned its attention to front line metrics. We talked to Field Operations staff across disciplines up and down the management chain, to agree a series of operational reports. What made this programme stand out was the work done to get these reports into the hands of the 600 people at the sharp end of business performance and asset management decision making. So, once the reports and data flow were defined, we worked with Thames Water s appointed business owners and technology provider to build the reports and get them consistently used and accepted with a comprehensive training and communications programme. But this programme was not just a short term fix and the business wanted to be confident that it could adapt the reporting structures and content if the business or information requirements changed. To ensure the long term value of the programme we worked with Thames Water to produce a clearly defined and documented method to keep reporting structures up to date no matter what the future may hold. 4 Enhancing performance through insight

5 New levels of visibility and understanding This programme achieved Thames Water s objectives improving visibility of how the business is doing and clearly showing the workforce how they contribute to achieving regulatory targets. The new front line reporting system enables managers to feed back specific, granular level information supporting current investment decision making and also informing investment propositions at the next price review. This new mechanism for giving feedback of what is really happening on the ground has also given front and back office staff a feeling of responsibility and accountability for business performance. How we work on MI projects When we work with our clients on a change programme, we want change to be successful in both the short and long term giving maximum value to the business. For this reason we followed a process which: Had senior sponsorship from the executive management team and senior managers in the design and formulation of the business case giving opportunities for these stakeholders to be involved in shaping and guiding the programme. Established clear and realistic business requirements across a large business user community and having performed a GAP analysis linked these requirements to outcomes and benefits. This work was focused on practical processes asking and answering questions such as how were Operations Managers going to use the information to drive cost out of the business or how were the Asset Managers going to make decisions on investment by using this new performance and cost data set? Got down to the granular detail of data model requirements covering cost types, volumetric data and accompanying asset data requirements. This also clarified the methods of analysis (e.g. trending, comparisons etc.) May not have been a technology programme, but as part of this initial phase defined the requirements to support flexible reporting, establish data integrity and process governance. Prioritised our work to get reports to the areas of the business that really needed them such as treatment work operations and asset optimisation functions. Developed a change strategy that would make this programme real for the hundreds of Thames Water employees that it impacted. This covered classroom based training for super users and technical SME s, and e-learning for dispersed field workers. Worked with the business to understand how and where the reports would slot into the regular management cycle to enable managers to drive performance and make the right decisions. Enhancing performance through insight 5

6 Making technology work hard for the business Thames Water had invested in reporting and data warehousing technology over the prior years but this programme was seen as an ideal opportunity to make the most of this investment into the operations of the business and drive performance improvement. To get the most out of existing assets, users would access and submit data directly via the wellestablished company portal. This was the first time that data had been delivered to the field in this way. Why it worked Our deep expertise in the Utilities sector means we know and understand the regulatory metrics that companies are targeted on and how these breakdown through the value chain. Combining this knowledge with our proven methodologies we were able to work with the business to define exactly what Management Information, cataloguing and report development the business needed. To make good decisions you need good data and this programme put real rigour around data quality and data governance. We spent significant time upfront agreeing the principles, benefits and business impacts with stakeholders before getting down into the detailed requirements. We prioritised work with the business so we were focusing on the areas of greatest value as early as possible. Seeing is believing and we made sure we gave people a preview of what their reports would look like they were more excited about what was coming. We worked closely with Thames Water to choose the right suppliers deploying work offshore to reduce costs in the technical specification and build phases. The large network of super users and the interest shown at senior levels gave us great engagement throughout the programme. We focused on squeezing maximum value from the Management Information suite did what we were producing pass the so what test? At every step this guided our decisions on how reports were built and used to give the most value to the business. 6 Enhancing performance through insight

7 Achieving your goals with enterprise performance management Management Information (MI) often focuses on the executive layer and processes within a business. It is important to recognise that people use information to guide their decisions and to perform at all levels of the organisation. On this programme we started at the top (aligning the senior MI to regulatory objectives and the new operating model) and worked our way down to the managers of the 4000 frontline staff in the field. We also focused on getting the right information to the right people to drive certain business processes, from lean operations to asset managers making investment decisions. We do not just look at data and reports but at people and how they work. This means investing in the right training and communications to get comprehensive buy-in to lasting change. We ask ourselves will the business still be working in this way in the years ahead? Looking for this long term return on investment influences what we do and how we work with our clients. We re seeing a greater demand for higher value business information but it must bring a return on investment. We ve worked with organisations spanning all industries, leading large, complex transformations. We realise there s more to this than just implementing a software tool. Our people s skills cover the broad EPM transformation skill set. We have the IT implementation and business function expertise, but we also bring people and change management to make sure your new approach is implemented successfully and permanently. Enhancing performance through insight 7

8 Contacts Richard Wyles +44 (0) (0) Barry Middleton +44 (0) (0) Steve Randle +44 (0) (0) This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it PricewaterhouseCoopers LLP. All rights reserved. In this document, PwC refers to the UK member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see for further details LC-OS