Opinion: If you're not 'doing' data, forget about digital commerce

In a second guest article, Keith Brody, Head of Communications at DigitalRoute, shares the benefits of mastering data.
Published: Mon 04 Sep 2017

We have established that a data layer (including how you collect and manage data, and what you subsequently do with it) is critical to success in digital commerce (and the IoT).

Let’s use the example of Alpiq, a leading Swiss utility provider, to explain why.

Like many companies, Alpiq identified a clear strategy to transform itself into a digital innovator and market leader (it did this around a year ago). Its goal in doing so was to develop, promote and market business models that required automated and highly developed smart technologies.

To do this required taking control of asset data from across all product portfolios and then consolidating it through one enterprise-wide IoT platform. Smart applications based on artificial intelligence for smart grid management, trading and demand side management would sit on top of this to better run the business.

As is so often the case in major IT projects - particularly where there is underlying technology change - reaching goals which sound achievable is hindered by the realities of the existing legacy landscape.

Complex legacy infrastructures are unavoidable in mature businesses. Tight integrations between IT applications and networks, rapidly growing data volumes, siloed architectures, and technology evolution itself all combine to inhibit rather than encourage digital transformation.

For Alpiq, its evolving infrastructure (you can think in terms of asset management, energy trading, wholesale generation, distribution operations, and customer service) as its digital strategy took shape had become a series of functions working in isolation from each other. The static dependency between IT and OT was preventing rather than driving success.

This is, perhaps, not surprising. Considering revenues less than half a decade ago were managed by batch-run, post-paid billing processes, the rapid change first to accommodate strategies that relied on situational awareness (machine to human, a growing number of data sources, the need for visualisation, etc.) and that today are reliant on stream processing, the change in requirements has been dramatic.

Infrastructure change is mandatory if digital transformations are to succeed.

Alpiq realised that it needed to deploy a technology capable of connecting all its assets -old and new- to its key business processes; this would be via a data integration and management application.

Its dramatic increase in new assets had made it clear that if they were not managed effectively then commercial momentum would not follow. While many new business opportunities were in view, handling challenges like real-time awareness, time to market for new services and managing the explosion of data were not being met by the company’s legacy operating stack.

A new approach would enable Alpiq to connect all its assets to its new operating technologies, thereby creating an enterprise-wide IoT solution that could consolidate the data from all portfolios. This step had the potential to be a game-changer given the urgent quest for sustainable and profitable future strategies that utilities face.  

Deploying a data integration and management technology would mean generating greater margins out of existing business and at the same time support a very short time-to-value for new services. Additionally, the more modern IT landscape that would result would deliver a drastically lower total cost of functionality when point data applications were consolidated to deliver access across all silos.

Alpiq had three core goals:  

  • First, despite the apparent limitations of legacy application and operational silos, the company recognised that it needed to protect its infrastructure in light of existing investments and the fact that significant change would increase costs of operation.
  • Second, it decided a data-driven architecture would be required to enable it to quickly bring new value-added services to market as well as to enhance customer control.
  • Third, it wanted to enable an operational shift towards the Cloud which over time would further reduce costs.

Protection of data infrastructure

With regard to the first point - the protection of silos - Alpiq’s philosophy could be summarised as recognising that the baby shouldn’t be thrown out with the bathwater.

The grow-in of new technologies had to be gradual and it would make sense to re-use existing data infrastructure investments where it was possible to do so. However, the company also recognised that there was a need to begin to share data between business segments (and therefore silos) in order to enable new business models and cloud based services.

Alpiq’s initial deployment therefore sourced data from a variety of inputs: third-party data relating to weather and seismology, metering data, field device data, operational data (SCADA monitoring), reference data, and third-party equipment data sourced from both customers and partners.

“Above” this, Alpiq chose to implement DigitalRoute technology as a horizontal integration layer between the data sources and Alpiq’s legacy applications (analytics, visualisation, services, etc.)

DigitalRoute also provided integration with the Amazon Cloud from which Alpiq was starting to run predictive modelling, customer empowerment, investment control, customer scoring, and asset utilisation applications fed by DigitalRoute. These applications, using the data in tandem with self-developed algorithms, quickly made a significant impact on business.

Alpiq’s strategy is now continuously delivering measurable benefits. The utility has taken control of both its data and its business transformation, preventing locked-in dependencies in the process. It has modernised its business landscape by transforming raw equipment data into versatile digital assets. Additionally, it has gained access to vital data and insights that it didn’t have before, in real-time, for smarter utilisation of business investments.

Benefits of good data management

Data is critical for utilities entering the digital business world. To summarise the benefits of mastering the data question and ensuring a successful digital transformation, the reasons are:

[1] Empower asset monetisation

Gain access to high-quality data and insights, from any combination of assets in real-time, for a more valuable and profitable business.

[2] Secure incremental digitalisation

Take control of data and control digital transformation, prevent locked-in dependencies and secure rollout processes. A strategic platform approach, implemented step-by-step, ensures swift and safe change.

[3] Optimise Operations

Remove massive overhead by consolidating all portfolio data in one enterprise wide information management platform. Create convergence across silos and enable smarter operations leading to increased margins.

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