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<strong>management</strong><br />

www.energycentral.com ENERGYBIZ MAGAZINE 39


38 ENERGYBIZ MAGAZINE July/August 2005


Managing<br />

Complexity<br />

EVERYONE KNOWS WHAT ASSET MANAGEMENT IS —<br />

THEY’RE JUST NOT SURE WHAT TO CALL IT.<br />

By Warren Causey<br />

Asset <strong>management</strong> seems to have as many names as there<br />

are vendors promoting it and utilities buying it. That’s because there<br />

is no one over-arching definition of the discipline. Is it enterprise<br />

resource planning (ERP)? Is it enterprise <strong>asset</strong> <strong>management</strong> (EAM)? Is<br />

it a system that produces process improvement from generation to<br />

the field? Is it inventory, financials, warehousing, wires and pipes, or<br />

people? What exactly constitutes an <strong>asset</strong>? Increasingly, utilities are<br />

determining that virtually everything they possess is an <strong>asset</strong> — from<br />

the information stored in automated systems, recorded on paper, or<br />

even communicated by word of mouth.<br />

The definition of <strong>asset</strong> <strong>management</strong> has shifted considerably since the<br />

early days when SAP, based in Germany, introduced the idea of “enterprise<br />

software” to U.S. companies back in the early- to mid-1990s. Considered<br />

prime targets, utilities were just coming out of a long slumber as regulated,<br />

protected, quasi-governmental organizations with great resources.<br />

Facing the very real risk of competition, utilities quickly realized that the<br />

“silo structure” of their information technology solutions wouldn’t work<br />

in the proposed new environment; nor would existing haphazard systems<br />

of locating, moving, and accounting for all kinds of <strong>asset</strong>s.<br />

Thus, SAP and other vendors began expanding their footprints to<br />

compete with SAP. They expected to take the industry by storm and<br />

eventually drive out niche players with all-encompassing, tightly integrated<br />

software packages. However, some strange things happened<br />

along the way to this planned vendor nirvana: collapse of deregulation<br />

in California; the demise of Enron and other corporate malfeasance;<br />

and the implosion of the wholesale energy market. One interesting<br />

phenomenon that resulted, besides the splintering of the enterprise<br />

<strong>asset</strong> <strong>management</strong> computing market, is most “energy companies”<br />

40 ENERGYBIZ MAGAZINE July/August 2005<br />

now want to be called “utilities” again. They also want to define,<br />

configure, and determine <strong>management</strong> of <strong>asset</strong>s on their own terms<br />

— not as some large vendors decided they should be defined.<br />

As a result, not only have SAP, Oracle, J.D. Edwards, PeopleSoft, and<br />

several others opted against creating monolithic “enterprise computing”<br />

empires at utilities, but also utility IT seems to be as splintered as ever<br />

— at least in the United States. The lineup of vendors also has changed<br />

considerably. First PeopleSoft acquired J.D. Edwards. Then Oracle acquired<br />

PeopleSoft. Traditional CIS/CRM vendor SPL WorldGroup acquired a smaller<br />

ERP/EAM vendor, Synergen, plus an OMS vendor, CES International, and<br />

now is playing in the “enterprise” <strong>asset</strong> <strong>management</strong> space.<br />

Several other ERP/EAM vendors have continued to broaden and<br />

expand their offerings to encompass more <strong>asset</strong>s. Indus International<br />

of Atlanta, for example, acquired a CIS from SCT and now calls its<br />

overall package “Service Delivery Management.”<br />

Utilities did catch on to the idea of having their systems communicate<br />

across the enterprise, but they have done so much “picking<br />

and choosing” that many enterprise or <strong>asset</strong> <strong>management</strong> vendors<br />

find themselves having to link to their competitors’ products at the<br />

same utility. One example of that trend is evident at Nashville Electric<br />

Service, which acquired Mincom software, an enterprise software<br />

vendor, and integrated it with PeopleSoft/Oracle. National Grid of New<br />

England is another case in point. Its U.S. operations run primarily on<br />

PeopleSoft, but its United Kingdom parent has a former (before the<br />

PeopleSoft merger) Oracle EAM solution. Lattice, a newly acquired gas<br />

subsidiary, employs SAP.<br />

The idea of enterprise <strong>asset</strong> or resource software has split into<br />

competing ERP and EAM paradigms. Both have enthusiastic advo-


cates and overlapping software. Utilities continue to mix and match<br />

their <strong>asset</strong> <strong>management</strong> solutions, but view them as a necessary part<br />

of a whole. “Work <strong>management</strong>, <strong>asset</strong> <strong>management</strong> and financial are<br />

integrated into one system,” says Connie Woo, vice president and CIO<br />

at Toronto Hydro. “The rest (CIS, SCADA, GIS) are stand-alone systems.<br />

We definitely would like to see all of these systems integrated to<br />

support seamless processes.”<br />

“Seamless processes across all <strong>asset</strong> groups and functions” is<br />

the mantra of most utilities today, especially the large investorowned<br />

entities that dominate 75 percent of the market. That includes<br />

systems that deal with <strong>asset</strong>s all the way to the residence or business.<br />

“I mentioned field service automation and SCADA, which are two areas<br />

I would like to see improved,” Woo says. “We also have a distribution<br />

<strong>management</strong> system, but we would like to expand it.”<br />

Even industry analysts categorize the <strong>asset</strong> <strong>management</strong> marketplace<br />

in different ways. Some will rank work <strong>management</strong> vendors in one<br />

study, EAM vendors in another, supply chain <strong>management</strong> (SCM) in yet a<br />

third category, and ERP vendors in a fourth or fifth category — sometimes<br />

even adorning the term ERP with Roman numerals for good measure.<br />

Vendors will stake claims to being the No. 1 solutions provider in<br />

one category or another. Sub-segments in the marketplace often are<br />

applied, for example, defining industry categories in different functional<br />

ways (energy companies including oil and gas as well as electric, or separate<br />

categories for electric generation vs. transmission vs. distribution),<br />

or by using three “tiers” to distinguish large-, mid-, and small-sized<br />

companies before analyzing the different vendors’ market shares.<br />

But for utilities, the main interest is in developing integrated software<br />

systems that enable them to improve the processes involved in<br />

dealing with their <strong>asset</strong>s and doing so system-wide. “A major area that<br />

I’m really looking at where there needs to be a breakthrough is in business<br />

process orchestration,” says Gene Zimon, senior vice president,<br />

Information Technology, NSTAR, based in Westwood, Mass. “If you buy<br />

the logic that you’re implementing processes by assembling legacy and<br />

new software components, you end up with a set of systems that has<br />

to be integrated in order to deploy an effective business process.”<br />

Thus one important “<strong>asset</strong>” being sought from technology is<br />

improved “process,” making the definition even more complex.<br />

The complexity of the undertaking was expressed by Mahvash<br />

Yazdi, senior vice president, business integration and CIO, Edison International<br />

and Southern California Edison,<br />

in Rosemead, Calif. “Our engineering<br />

organization is looking into application<br />

of technology wherever it makes sense<br />

in terms of both transmission and distri-<br />

bution <strong>asset</strong>s,” he says. “We also have a<br />

group that we call our technology watch<br />

group, and we are looking at informationrelated<br />

technology, such as automation of<br />

field tools. We are providing our linemen<br />

and trouble men with computers in their<br />

trucks and with tools that will enable<br />

them to manage their work in a real-time<br />

fashion, and have the right material<br />

[<strong>asset</strong>s] at the right location. We’re looking<br />

at power line carriers in a private<br />

fashion, potentially for a narrow-band<br />

automated meter reading. So, we have<br />

technology groups that are doing technology<br />

evaluation as well.” That means<br />

meters and the systems and individuals<br />

who read them are <strong>asset</strong>s, as well.<br />

Toronto Hydro’s Woo also views <strong>asset</strong> <strong>management</strong> as part of<br />

Vendors will<br />

stake claims<br />

to being the<br />

No. 1 solution<br />

provider in one<br />

category or<br />

another.<br />

“service-oriented architecture.” Woo says: “We are planning an<br />

upgrade of our EAM system, which is the system from Mincom that<br />

encompasses all our work <strong>management</strong>, human resources, <strong>asset</strong><br />

<strong>management</strong>, our financials, our supply chain, and all of our back office.<br />

So we’re planning to upgrade to the next version of that system. Hopefully,<br />

that will move us to a new architecture — the service-oriented<br />

architecture. Hopefully that will position us better for the Web and<br />

future automation.”<br />

Despite the attempt by vendors and analysts to quantify and<br />

“pigeonhole” <strong>asset</strong> <strong>management</strong>, it continues to be elusive in terms<br />

of definition at utilities. But due to their <strong>asset</strong>-intensive nature, utilities<br />

know they need to be involved in it. They understand that <strong>asset</strong>s<br />

include everything from the pole or transformer in the field to the<br />

business intelligence provided to the boardroom by integrated enterprise<br />

systems that enable executives to see the status of those poles,<br />

transformers, generating plants, and field service crews.<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 41


Blending<br />

Solutions<br />

A GEORGIA CO-OP GOES “BEST-OF-BREED.”<br />

By Warren Causey<br />

Cobb Electric Membership Corp.(EMC), in Marietta, Ga.,<br />

is atypical of cooperative utilities in the United States. With its service<br />

territory located in one of the fastest-growing areas of suburban<br />

Atlanta, it’s larger than most co-ops with approximately 180,000 electric<br />

customers and more than 100,000 natural gas customers — all captured<br />

after the Georgia natural gas market was deregulated in July 1988.<br />

Cobb EMC also has morphed over the last 10 years from a traditional<br />

electric co-op to a multi-product company that sells everything<br />

from electricity and natural gas to local and long-distance telephone<br />

service, Internet service, home security, and more.<br />

To deal with its exploding list of services, Cobb EMC formed Cobb<br />

Energy Management Corp. (Cobb Energy) in 1997, a for-profit entity<br />

formed to be an aggregator of services for the membership of Cobb<br />

EMC and others.<br />

By 2003, it became obvious that Cobb EMC’s Orcom Customer<br />

Information System, which handled everything from financials and<br />

billing to tracking <strong>asset</strong>s in the field, needed updating.<br />

“That software really served us well through the years, but the<br />

way our company looked in 1995 [when the Orcom CIS was installed]<br />

and today is totally different,” says Steve Paolucci, associate vice<br />

president of finance at Cobb Energy. “The old monolithic software just<br />

couldn’t handle it anymore.”<br />

As a result of that impasse, Cobb Energy began exploring enterprisewide<br />

<strong>asset</strong> <strong>management</strong> software in 2003. In 2004, it began installing a<br />

new set of solutions. Most software and hardware for the entire enterprise,<br />

including the original co-op, now reside with Cobb Energy.<br />

“When we went into this project, we had hoped we could find one piece<br />

of software that could do everything we needed done,” Paolucci says.<br />

The fact that it didn’t work out that way is typical of many utilities<br />

in the United States — they haven’t been fertile ground for the large<br />

enterprise computing firms like Waldorf, Germany’s SAP.<br />

“We started with five or seven different options and narrowed it<br />

down to three: Lawson Software, St. Paul, Minn., PeopleSoft [now an<br />

Orcom subsidiary], and SAP,” Paolucci says. “We did intense sessions<br />

with those companies, gave them our requirements, and asked<br />

whether they could meet our needs out of the box, with minor modifications<br />

or major modifications.”<br />

42 ENERGYBIZ MAGAZINE July/August 2005<br />

That process, which was assisted by Capstone Consulting Partners,<br />

now a subsidiary of Alliance Data Systems, of Dallas, extended through<br />

last summer. However, none of the companies could satisfy Cobb Energy’s<br />

needs completely, Paolucci says. At that point, the utility decided<br />

to go with a “best of breed” solution. The result is the kind of mix-andmatch<br />

software selection that has driven executives of “enterprise”<br />

software firms up the wall and resulted in considerable consolidation.<br />

Cobb Energy will implement the following line-up of <strong>asset</strong> <strong>management</strong><br />

software:<br />

Lawson Software will handle financials and human resources/<br />

payroll.<br />

A new Cordaptix CIS from SPL WorldGroup, San Francisco, will<br />

be installed for customer care and billing.<br />

A component of Worksuite, of Houston, will provide the frontend<br />

for Cobb Energy’s existing field automation system.<br />

Intelliplant, a product of Information Intellect, of Marietta,<br />

Ga., will handle fixed <strong>asset</strong> <strong>management</strong> accounting for<br />

power and distribution <strong>asset</strong>s.<br />

“An EMC, like any distribution company, is pretty <strong>asset</strong> intensive, with<br />

most of the <strong>asset</strong>s being in transmission and distribution,” says Paolucci,<br />

explaining why there is a separate accounting system for fixed <strong>asset</strong>s.<br />

“Most generic accounting systems have one <strong>asset</strong> number for something<br />

such as a pole. Thus, they have to treat all those <strong>asset</strong>s individually. To<br />

avoid that, there are some specialty software systems that handle these<br />

things as groups. Information Intellect<br />

has one of those.”<br />

Cobb Energy now is installing<br />

and integrating all of the software.<br />

“We’ve been through three conversions<br />

so far,” Paolucci says. “We<br />

decided to try to learn from our<br />

previous mistakes — one of those<br />

was to run the projects ourselves.<br />

That’s why we hired Capstone. We<br />

wanted a company that had some<br />

expertise in managing a project for<br />

us so we could stay sort of on the<br />

outside and be more concerned<br />

with learning the software and<br />

training.”<br />

Despite the assistance, the<br />

installation is progressing in<br />

stages and won’t be fully<br />

completed until sometime in 2007,<br />

Paolucci says. When it is, Cobb<br />

Energy/EMC will join a long list<br />

of utilities that entrusts <strong>asset</strong><br />

<strong>management</strong> to a collection of<br />

best-of-breed software from<br />

several companies.<br />

definitions<br />

The following are offered<br />

as a guide.<br />

ERP – Enterprise Resource<br />

Planning<br />

ERP systems developed originally<br />

in heavy industry and tended<br />

to emphasize financials and<br />

resource planning, though they<br />

gradually grew to include work<br />

<strong>management</strong>, human resources,<br />

and other “softer” disciplines,<br />

including even customer information<br />

systems (CIS).<br />

EAM – Enterprise Asset<br />

Management<br />

EAM systems developed in more<br />

process-oriented industries with<br />

more emphasis on human resources<br />

and work <strong>management</strong>, but<br />

gradually grew to include financials<br />

and supply chain <strong>management</strong>/resource<br />

planning and CIS.<br />

SCM – Supply Chain<br />

Management<br />

SCM grew up in plants and<br />

factories and still concentrates<br />

primarily on the movement of<br />

parts, fuel, and other supplies<br />

within the heavy-industry supply<br />

chain. However, some SCM systems<br />

have grown to include other<br />

elements of ERP and EAM.


www.energybizmag.com ENERGYBIZ MAGAZINE 43


Improving Asset<br />

Efficiency for<br />

Productivity<br />

Gains<br />

By Brunson White<br />

Asset <strong>management</strong> capability within integrated enterprise<br />

solutions are rapidly transforming the ways in which both gas<br />

and water utilities monitor and repair their vast arrays of <strong>asset</strong>s.<br />

Energen Corp. recently revolutionized its business processes and<br />

created valuable new efficiencies by successfully implementing an<br />

enterprise resource planning (ERP) system that features integrated<br />

<strong>asset</strong> <strong>management</strong> functionality.<br />

Providing natural gas to more than 460,000 customers statewide,<br />

Alagasco and Energen have experience with periods of sustained<br />

change and a long history of preparing for the future. The company<br />

got its start in 1852 as Montgomery Gas Light. The company has<br />

two major subsidiaries: Alagasco, its natural gas utility, and Energen<br />

Resources, its oil and gas exploration and production company. Through<br />

its two subsidiaries, Energen acquires and develops domestic oil and<br />

gas properties and distributes natural gas throughout Alabama.<br />

Energen’s presence in the upstream as well as the downstream<br />

side of the business enhances the company’s understanding and<br />

appreciation of the entire energy value chain. Operating within two<br />

distinct aspects of the energy industry further serves to emphasize<br />

the importance of an IT solution that can create communications with<br />

a strong information flow between different departments.<br />

In 2002, Energen reevaluated its outdated legacy systems and<br />

numerous manual processes that had become large cost centers,<br />

concentrating primarily on the operations of Alagasco. With approximately<br />

1,200 employees and significant operations in seven states,<br />

Alagasco was outgrowing the cumbersome manual processes it used for<br />

project approval and documentation. Rather than continue underutilizing<br />

the company’s physical <strong>asset</strong>s by manually inputting project information<br />

into legacy systems, delivering documentation through inter-office mail,<br />

and manually reporting for regulatory compliance, <strong>management</strong> decided<br />

to employ an enterprise technology to manage all <strong>asset</strong>s by aiming to<br />

maximize the return on investment within each <strong>asset</strong>.<br />

The company first declared the need to make <strong>asset</strong>-related work<br />

(maintenance, productivity, automation) safer and more efficient. From<br />

an <strong>asset</strong> <strong>management</strong> standpoint, there were several other problems<br />

to address as well. Operating expenses were consistently rising due to<br />

44 ENERGYBIZ MAGAZINE July/August 2005<br />

a lack of transparency between different systems and an inadequate<br />

IT infrastructure for alerting managers to equipment requiring repairs<br />

and replacement. Inaccurate data records detailing plant and fleet <strong>asset</strong><br />

usage and repairs further stymied the company’s ability to operate<br />

at full production. Having looked at numerous solutions from several<br />

vendors to replace the homegrown systems, the IT staff’s first priority<br />

was a solution with a high level of integration. Not only would an easily<br />

integrated solution allow the company to streamline processes for work<br />

orders and maintenance, but it would also deeply embed within numerous<br />

departments across the enterprise — from accounting to maintenance,<br />

creating large productivity gains for a greater number of employees. As<br />

a company with a strong corporate culture spread throughout the state<br />

of Alabama, reaching a high level of employee buy-in to the implementation<br />

was another important goal.<br />

Energen officials chose the mySAP ERP system with <strong>asset</strong> <strong>management</strong><br />

functionality. Aiming for a launch date of Jan. 1, 2003, the project<br />

team began the implementation phase in March 2002. The greatest<br />

impact of the implementation was within Alagasco’s distribution<br />

system. Consisting of more than 30,000 miles of pipe that deliver<br />

natural gas directly to thousands of customer locations, the distribution<br />

system remains the company’s most important <strong>asset</strong>. Any defect<br />

in the piping can lead to an immediate revenue and product loss.<br />

Through the ERP system, capital project approvals and materials<br />

<strong>management</strong> helped expedite the process of expanding and improving the<br />

distribution system. With workflow <strong>management</strong>, project approval time<br />

decreased from a full work week to within a day. Moreover, materials that<br />

were in shortage are quickly re-routed to projects with the most significant<br />

need. For example, if additional materials and workers are required<br />

for constructing a new border station, both maintenance teams and<br />

materials are quickly dispatched from lower priority projects to provide<br />

maintenance, avoiding job stoppages due to a shortage of materials.<br />

Additional productivity gains are derived from improving the processes<br />

for acquiring and maintaining company <strong>asset</strong>s. All new <strong>asset</strong> acquisitions<br />

— from facilities to technology to office furnishings — are made within<br />

the system, approved by an internal check of real-time budget figures.<br />

After purchase, depreciation schedules are automatically added into the<br />

system for use by accounting and other departments, eliminating costly<br />

paperwork. For maintenance projects, entering work orders modularly<br />

into the system allows for information to be shared enterprise-wide,<br />

enabling different departments to move forward without having to wait<br />

for a paper trail to reach their desks. For example, while repair crews<br />

evaluate a work order for a fleet vehicle, the purchasing department can<br />

review the costs of replacing the vehicle. When the maintenance team’s<br />

final report is entered into the system, <strong>management</strong> has the up-to-theminute<br />

information to make an informed decision about replacement.<br />

As with any enterprise software installation, the Alagasco implementation<br />

experienced considerable challenges — the greatest of which<br />

rested in allowing the workforce to adapt to process changes. Through<br />

ongoing demonstrations of the advantages of the new enterprise<br />

system, Energen <strong>management</strong> was able to emphasize the time-saving<br />

benefits of the new system to end-users. Another obstacle arose from<br />

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ebiz_banner1.indd 1 6/28/05 4:22:29 PM


www.energybizmag.com ENERGYBIZ MAGAZINE 45


the granularity of the data provided by the<br />

system, at first resulting in a hypothetical “data<br />

overload.” However, through ongoing exposure,<br />

end-users and customer-facing employees<br />

were able to quickly turn this hindrance into<br />

a strength. When making purchase decisions<br />

about field equipment, Energen <strong>management</strong><br />

can now deftly search through the performance<br />

history of specific equipment, allowing<br />

for quicker, more-informed decision-making.<br />

As other utilities look to improve <strong>asset</strong><br />

<strong>management</strong>, they should seek out an implementation<br />

option that can instantly integrate<br />

with established business processes and link<br />

throughout the entire value chain. Industry<br />

best practices often preach about the value<br />

of an integrated approach, but this is an area<br />

that cannot be stressed enough. An integrated<br />

solution provides for a quicker and<br />

easier installation. Moreover, by integrating<br />

all business processes, Alagasco achieved a<br />

sophisticated level of service and responsiveness.<br />

Flaws within the distribution system were<br />

easily tracked, setting a maintenance schedule<br />

ranking repairs by areas of need and resulting in<br />

the lessening of revenue and product loss.<br />

No matter how skilled the IT department,<br />

a successful and seamless enterprise implementation<br />

cannot be handled alone. Thirdparty<br />

or vendor personnel must be available<br />

to help employees learn new systems and to<br />

ensure that phased implementations stick<br />

to original timetables and meet pre-designated<br />

goals. All utilities must be able to trust<br />

a vendor. At Energen, the team consistently<br />

worked well with our software partners and<br />

consultants, who were able to quickly train<br />

employees to utilize the new software, while<br />

providing a rational, goal-driven template for<br />

future implementations and upgrades.<br />

Energen realized quick, significant returns<br />

from its ERP solution. Overall costs fell with<br />

particular improvements seen by reducing<br />

mechanical failures and providing responsive<br />

corrective maintenance. Critical plant, fleet,<br />

and distribution equipment saw maintenance<br />

costs drop as well. Moreover, operational efficiencies<br />

increased greatly with the advent<br />

of real-time information and near real-time<br />

budgeting, allowing for the widespread transmission<br />

of mission-critical information to<br />

46 ENERGYBIZ MAGAZINE July/August 2005<br />

departments throughout the enterprise. With<br />

the ERP solution to help manage Alagasco’s<br />

workload, response time has improved drastically,<br />

which in turn improves customer service<br />

and loyalty measures.<br />

With the widespread success of the ERP<br />

system featuring <strong>asset</strong> <strong>management</strong> capabilities,<br />

Energen continues to bolster its production<br />

and cut down on costs by targeting the supply<br />

chain. A project team is currently working to<br />

install a document <strong>management</strong> system (DMS)<br />

to facilitate the accounts payable portion of<br />

the supply chain, linking the finance department<br />

with production efforts. Company-wide,<br />

a new focus has been embraced, calling for<br />

ongoing examination of business processes<br />

with the intent of delivering greater returns to<br />

customers and shareholders.<br />

Enterprise <strong>asset</strong> <strong>management</strong> is evolving<br />

outside of the legacy systems of the past two<br />

decades, becoming a significant part of the<br />

fully integrated utility. The major barrier to this<br />

transformation is the unwillingness of corporations<br />

to address the change <strong>management</strong><br />

issues concerned with leaving the interfaced,<br />

o n t o p i c<br />

Utility Outsourcing articles<br />

from EnergyPulse<br />

To view any of these articles, please go to<br />

www.energycentral.com/quicklink and type the<br />

quick link code into the quick link box.<br />

End the Asset Management Tug-of-War<br />

Richard MacDonald, SPL WorldGroup, Inc.<br />

Quick link code: P1025<br />

Optimizing EAM<br />

John Yolton, Solutions Associates<br />

Quick link code: P539<br />

It’s Always Been About Asset Management<br />

Frank Craig, MCR Performance Solutions<br />

Quick link code: P531<br />

Working Capital Reduction<br />

Donald Ryan, dynaTHinK LLC<br />

Quick link code: P402<br />

Asset Management, in Theory and Practice<br />

Bruce Humphrey, KEMA<br />

Quick link code: P386<br />

Capital Asset Life Extension<br />

Anthony Impelluso, AIM Engineering, LLC<br />

Quick link code: P320<br />

less-optimized world. The ROI to complete this<br />

transformation is available; organizations must<br />

be willing to venture outside of their comfort<br />

zones to realize the full potential of the integrated<br />

enterprise. While it’s difficult to predict<br />

when this trend will become the norm, integrated<br />

<strong>asset</strong> <strong>management</strong> will soon become<br />

the low-hanging fruit of the future as utilities<br />

look to complete supply chain optimizations.<br />

While some <strong>asset</strong>-intensive industries are<br />

unique enough to require highly specialized<br />

functionality within the <strong>asset</strong> <strong>management</strong><br />

space, I would argue these are the exception<br />

rather than the rule. In the end, the ultimate<br />

answer for utilities lies in extending ERP<br />

systems with new open-standard architecture<br />

platforms that preserve the deep integration<br />

of all business processes.<br />

Brunson White is the CIO of Energen Corp.,<br />

headquartered in Birmingham, Ala. He also<br />

currently serves as the chair of the American<br />

Gas Association/Edison Electric Institute<br />

Technology Advisory Council.<br />

A New Look At Spending Optimization<br />

Scott Sidney, UMS Group<br />

Quick link code: P204<br />

Seven Principles of T&D Asset Management<br />

Bill Cozzens, Soluziona USA<br />

Quick link code: P193<br />

Asset and Supply Chain Management<br />

Junaid Yasin, ProcureZone<br />

Quick link code: P185<br />

Value of Early Warning of Failure<br />

Tim Holtan, SmartSignal Corp.<br />

Quick link code: P159<br />

Asset Optimization<br />

Dunham Cobb, CGEY<br />

Quick link code: P137<br />

Utilities Need More Asset Management<br />

John Geoghegan, IBM<br />

Quick link code: P113<br />

Mixed Signals Cloud Reliability Picture<br />

Bruce Humphrey, KEMA<br />

Quick link code: P387<br />

Enterprise Exposure Management<br />

Kevin R. Rose, ENSIGHT Advisors<br />

Quick link code: P24


www.energybizmag.com ENERGYBIZ MAGAZINE 47


[ C A S E S T U D Y ]<br />

Mobile Computing Tools For Mobile Workers Improve<br />

Is the utility industry undergoing a sea change? Most analysts agree<br />

that it is not. They say, in fact, that it has already happened. The past<br />

model for increasing utility company profits — raising rates — is obsolete.<br />

New economic realities compel savvy executives to focus on bottom<br />

line improvements to increase market share, improve employee<br />

efficiency, maximize customer-retention levels and cut costs.<br />

And, they say, the 21st century’s emphasis on enterprise and productivity<br />

offers utility companies opportunities unseen since the early days<br />

of state and federal regulation three- quarters of a century ago. These<br />

opportunities more than justify the challenges inherent in seizing them.<br />

As one recently retired marketing vice president put it, “When<br />

I started in the business our major sales efforts were directed at<br />

legislators. When I left, it was all about customers. Which is how it<br />

should be. The legislators made sure we never lost money, but they<br />

also limited what we could do to earn income and how much of that<br />

revenue we could retain. Utilities are a no-limits industry now. A guy<br />

starting out in my business today may wind up building something<br />

more profitable than Microsoft by the time he steps down.”<br />

Exploiting new worlds — unlimited worlds — requires new tools. Better<br />

tools. Faster tools. More fail-safe tools. Tools that will work anywhere,<br />

anytime, under any conditions. Tools with an almost infinite capacity to<br />

be scaled up to do more work and scaled out to perform new tasks.<br />

Next-generation, utility task-optimized rugged portable computers,<br />

such as the Panasonic Toughbook® CF-18 and CF-29,<br />

are prime examples of tools that generate a direct impact on a utility<br />

company’s bottom line. This positive impact is measurable and<br />

occurs on both the revenue and cost sides of the balance sheet.<br />

A typical case study proves that the deployment of cuttingedge<br />

mobile-computing technology not only improves the bottom<br />

line, it improves it dramatically. And, in some cases, such as that<br />

of the United Kingdom’s largest power supplier, British Gas, the<br />

word “dramatically” could fairly be called an understatement.<br />

Prior to digitalization, British Gas had hundreds of field offices<br />

and 17,000 tech and back-office workers, most of them spending<br />

their workday shuffling papers. Today that 17,000-person workforce<br />

numbers less than 4,000, and most of the field offices have been<br />

shuttered.<br />

Wireless-capable Panasonic CF-18 ruggedized “convertible”<br />

notebook/tablets help a field force handle over 6 million service<br />

calls a year. Errors in ordering replacement parts have been<br />

reduced from one-in-four to “practically nonexistent” and delivery<br />

of those parts takes 12 hours, not several days.<br />

According to British Gas, the productivity of their technicians<br />

using the CF-18 has more than doubled, going from an average<br />

of four calls per day to ten and resulting in a “huge reduction in<br />

infrastructure and labor costs.”<br />

48 ENERGYBIZ MAGAZINE July/August 2005<br />

The British Gas experience proves that ruggedized computers<br />

with multi-protocol wireless connectivity are an essential component<br />

in reducing utility company operating expenses on both a global and<br />

per-call level.<br />

But can that impact really be shown on the other side of the<br />

ledger? Can a piece of hardware such as a Toughbook actually<br />

increase revenue as well as reduce costs?<br />

Research shows that it can, but only if that new piece of hardware<br />

fits perfectly within the IT scheme of the company deploying<br />

it. It must be more than the correct tool for the job; it must be the<br />

right tool for the entire enterprise.<br />

After intensive study and stringent testing, British Gas decided<br />

on the CF-18 because it exceeded both the performance and<br />

durability specifications for generic field-force computers and the<br />

task-specific requirements of a huge, diversified power utility.<br />

In addition to being the United Kingdom’s largest industrial and<br />

consumer supplier of gas and electricity, British Gas engages in<br />

such varied enterprises as appliance sales and repair, financial<br />

services, and security system design and implementation.<br />

The company employs field technicians for such disparate<br />

tasks as meter reading, line and pipeline maintenance, central air<br />

and heating system installation, commercial and residential steamboiler<br />

repair, and kitchen appliance service.<br />

To equip such a diverse workforce without hobbling the<br />

IT department with a hard-to maintain assortment of differing<br />

computer models and platforms, British Gas needed a high-performance,<br />

standardized unit with exemplary multitasking and communications<br />

ability.<br />

A fully ruggedized 4.5-pound computer with extended battery<br />

life, a 40GB shock-mounted hard drive and a daylight-readable,<br />

pressure sensitive touchscreen, the CF-18 instantly converts from<br />

a high-performance Windows XP notebook to a Windows XP tablet<br />

computer via a unique swiveling and folding screen.<br />

The Toughbook’s ability to replace both outdated notebooks<br />

and traditional, proprietary-software-driven pen tablets was<br />

critically important to British Gas, as was the CF-18’s full Intel®<br />

Centrino compliance and simultaneous wireless WAN, wireless<br />

LAN, Bluetooth and GPS capability.<br />

The time, effort and expense British Gas invested in its quest to<br />

maximize the return on its field-force computerization investment<br />

has paid off handsomely. Not only have the ruggedized portables<br />

dramatically reduced the sales, general and administrative share<br />

of every dollar British Gas spends on field force labor and materials,<br />

they have produced measurable revenue gains in areas susceptible<br />

to competitive pressures.<br />

According to British Gas Home Services IT business manager,<br />

Peter Ransom, the Panasonic “convertibles” are providing “absolutely<br />

fantastic” service. “Mobile computing has helped us reduce<br />

response times to call-outs, increase the speed of job turnaround,<br />

and ... present a fresh, clean and very professional image to the<br />

customer,” Ransom said.<br />

A D V E R T I S E M E N T


A D V EE RR TT II SS E M E N T<br />

[ C A S E S T U D Y ]<br />

To put it simply, the Toughbook implementation has helped<br />

British Gas achieve unusually high customer-satisfaction levels<br />

— the Holy Grail of all enterprises trying to increase market share,<br />

profits and ROI via new business acquisition and retention.<br />

Another utility company that has used cutting-edge mobile computing<br />

and communications technology to lead its industry in customer<br />

satisfaction is Arizona’s Salt River Project, recipient of the 2004 J.D.<br />

Power and Associates Distinction for Electric Utilities Award.<br />

SRP, which uses fully ruggedized Panasonic notebooks such<br />

as the Toughbook CF-29—a MIL-STD-810F-tested, Centrino-compliant<br />

portable—reports that increased use of rugged portable<br />

computers in the field has resulted in substantial savings in both<br />

dollars and personnel hours.<br />

And, SRP says, those are only some of the benefits attributable<br />

to the Toughbook deployment. Others include increased work crew<br />

efficiency, better communications and scheduling, safety improvements<br />

related to having the most current electric maps available<br />

for each job, safety improvements related to a decrease in miles<br />

driven to obtain maps and support at field offices, decreased radio<br />

and cell-phone traffic, an increase in customer service quality and<br />

a decrease in the amount of time customers are out of service.<br />

Since SRP’s corporate culture orbits around customer service,<br />

the last two items on that very impressive laundry list are arguably<br />

the most important. The company’s 2004 rating of 112 on J.D.<br />

Power’s utility customer satisfaction list outranked that of every<br />

other electricity supplier in the U.S., and company officials plan to<br />

do at least that well this year.<br />

SRP managers attribute a good part of their long-term customer<br />

honeymoon to the company’s policy of constantly upgrading and<br />

updating their mobile computing capability, adding applications<br />

and enhancements as they become available rather than waiting<br />

for the end of their hardware’s life cycle to renew the system.<br />

While companies throughout the utility spectrum are faced with<br />

the challenge of increasing profits without raising rates, there is no<br />

place where the shift to a new earnings model is more dramatic<br />

than in the cable television and telephone industries.<br />

Faced, for the first time, with competition from other cable<br />

companies as well as satellite providers, cable operators in many<br />

parts of the country are fighting increasingly bitter market-share<br />

wars. Rates are going down, the number of basic, nonpremiumtier<br />

channels is going up, and customer acquisition and retention<br />

enhancements like HDTV receivers or personal video recorders<br />

are being offered at cost or below. Despite all these factors, surveys<br />

still identify dissatisfaction with customer service as the most<br />

common cause of television provider churning.<br />

If market conditions in the broadcast-delivery business are<br />

chaotic, those in the telephone industry are in a state of complete<br />

bedlam. According to some surveys, the number of households<br />

that switched local telephone providers increased by more than<br />

60 percent in 2003-2004, with more than 10 percent of all U.S.<br />

telephone users either changing their primary carrier or abandoning<br />

traditional copper-wire service completely.<br />

Virtually every consumer willing to spend 30 minutes in online<br />

research can find a cellular provider offering them an almost unlimited<br />

number of online minutes, free voicemail, free long distance and<br />

free nationwide roaming for less than $50 a month. And they are<br />

willing to deliver all this service, as well as a “free” phone, directly to<br />

the customer’s mailbox, thus changing the service equation from a<br />

standoff — sitting at home waiting for an installer vs. standing in line<br />

at a cell phone store — to a win for the cellular provider.<br />

Given the advantages of reasonable monthly costs, free longdistance,<br />

no in-home service calls and portability, it’s no surprise<br />

that increasing numbers of Americans are firing their landline<br />

phone companies.<br />

“Utility professional<br />

continually trust the<br />

Toughbook CF-29 and<br />

convertible<br />

Toughbook CF-18 for<br />

rugged reliability and<br />

industry-leading uptime<br />

at a significantly lower<br />

total cost of ownership.”<br />

Responding to this pressure, many traditional phone providers<br />

have relinquished some of their most historically cherished profit centers<br />

to maintain market share. Package plans bundling unlimited local<br />

and long distance calling and a range of premium services — everything<br />

from call waiting and voice mail to distinctive ring tones and, in<br />

some cases, DSL — for a fixed, cut-rate price are proliferating.<br />

Making money while offering customers more bells and whistles<br />

for fewer dollars demands rigorous attention to cost control<br />

and employee productivity. Getting customers to subscribe — and<br />

stay subscribed — to those packages, regardless of their value,<br />

requires an almost obsessive focus on customer service. “While<br />

price will always be an important factor, satisfying customers has<br />

become more about the quality of the relationship and the provider,”<br />

says telephone industry analyst Steve Kirkeby.<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 49


Explaining why his company recently pulled almost 3,000<br />

supervisors out of their offices and sent them into the field<br />

with ruggedized notebook computers, a key executive with one<br />

of America’s biggest telecommunications companies echoed<br />

Kirkeby. “The program is designed to enable us to do better work,<br />

more tightly scheduled work, and safer work,” he said. “It all comes<br />

down to increasing the quality of our customer service.”<br />

Improving customer relations by redefining its concept of service<br />

and spending millions of dollars on better tools was a formidable<br />

challenge for this company, but given the importance of every<br />

single market-share point won or lost, one it had to undertake.<br />

Since abandoning the concept of behind-a-desk supervisors<br />

in favor of “floating field offices” required portable computers<br />

capable of wearing many hats, selecting the perfect hardware<br />

platform was crucial.<br />

The notebooks would be used to monitor and evaluate field<br />

technicians while they worked, allowing supervisors to give them<br />

real- time problem-solving guidance. The units would need to be<br />

automatically updated with new cable maps, location records and<br />

service procedure changes and each would have to be capable<br />

of connecting to any of the several wireless protocols used in the<br />

company’s vast service area.<br />

And they would have to run all the applications the supervisors<br />

had previously performed in-office and file the generated e-documents<br />

on the company’s servers from wherever the supervisor happened<br />

to be. Finally, the computers had to be bulletproof. Failure<br />

of a technician’s computer, with the resultant backing up of service<br />

orders, is bad. Failure of a computer in the truck of someone with<br />

15 employees to support is unacceptable.<br />

The decision to use ruggedized Toughbooks such as the CF-<br />

29 was based on many factors, not the least being Panasonic’s<br />

unique position as the industry’s only core manufacturer of rugged<br />

computers and rugged computer components.<br />

50 ENERGYBIZ MAGAZINE July/August 2005<br />

[ C A S E S T U D Y ]<br />

CONTACT INFORMATION<br />

Rance Poehler, President<br />

Panasonic Computer Solutions Company<br />

Jim King<br />

VP of Operations<br />

Jared Gould<br />

VP of Engineering<br />

Brandi Gil<br />

Director of Marketing<br />

PANASONIC COMPUTER SOLUTIONS COMPANY<br />

50 Meadowlands Parkway<br />

Secaucus, NJ 07094<br />

Phone 800.662.3537<br />

Fax 201.392.6618<br />

www.panasonic.com/toughbook<br />

BUSINESS CONTACT<br />

Thell Gillis<br />

Phone (281) 395-8420<br />

thell_gillis@p2c2.com<br />

A D V E R T I S E M E N T


A D V E R T I S E M E N T<br />

[ C A S E S T U D Y ]<br />

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www.energybizmag.com ENERGYBIZ MAGAZINE 51


Sourcebook<br />

Listing Categories<br />

ENTERPRISE ASSET MANAGEMENT PAGE 52<br />

MAINTENANCE MANAGEMENT PAGE 56<br />

SW IMPLEMENTATION/SYSTEMS INTEGRATION SERVICES PAGE 56<br />

BUSINESS PROCESS PAGE 58<br />

MAINTENANCE OUTSOURCING PAGE 59<br />

OTHER PAGE 59<br />

ENTERPRISE ASSET MANAGEMENT<br />

Advantica<br />

PO Box 86<br />

Carlisle, PA 17013<br />

(717) 243-1900<br />

www.advantica.biz<br />

American Software<br />

470 East Paces Ferry Road<br />

Atlanta, GA 30305<br />

(404) 264-5296<br />

www.amsoftware.com<br />

Artemis International Solutions Corporation<br />

4041 MacArthur Boulevard, Suite 401<br />

Newport Beach, CA 92660<br />

(800) 477-6648<br />

Fax (949) 660-6501<br />

www.aisc.com/sao<br />

Contact<br />

Dan Niswonger, SAO Solution Sales Manager<br />

(847) 441-1802<br />

Dave Thomas, SAO Solution Sales<br />

(312) 231-7170<br />

Artemis International Solutions Corporation is<br />

the world’s leading provider of Investment Planning<br />

and Control solutions. The Artemis Strategic<br />

Asset Optimization Solution is based on a proven<br />

enterprise portfolio and project <strong>management</strong> platform<br />

by the world’s largest energy companies. This<br />

robust and highly configurable platform permits you<br />

to think big for the long term, but lets you start small<br />

and obtain highly measurable productivity results<br />

and/or ROI benefit in the short term.<br />

Champs Software, Inc.<br />

1255 North Vantage Point Drive<br />

Crystal River, FL 34429<br />

(352) 795-2362<br />

www.champsinc.com<br />

52 ENERGYBIZ MAGAZINE July/August 2005<br />

Data Systems & Solutions, LLC<br />

12100 Sunset Hills Road, Suite 310<br />

Reston, VA 20190<br />

(703) 375-2800<br />

www.ds-s.com<br />

Datastream Systems<br />

50 Datastream Plaza<br />

Greenville, SC 29605<br />

(864) 422-5001<br />

www.datastream.net<br />

Datria Systems, Inc.<br />

7211 South Peoria Street, Suite 260<br />

Englewood, CO 80112<br />

(303) 728-1300<br />

www.datria.com<br />

EPRI Solutions, Inc.<br />

942 Corridor Park Boulevard<br />

Knoxville, TN 37932<br />

(865) 218-8000<br />

www.eprisolutions.com<br />

ESRI 380 New York Street<br />

Redlands, CA 92373<br />

(909) 793-2853<br />

www.esri.com<br />

GEAC Enterprise Solutions<br />

11 Allstate Parkway, Suite 300<br />

Markham, ON L3R 9T8, Canada<br />

(905) 475-0525<br />

www.geac.com<br />

Hansen Information Technologies<br />

11092 Sun Center Drive<br />

Rancho Cordova, CA 95670<br />

(916) 921-0883<br />

www.hansen.com<br />

IFS 10 North Martingale Drive, Suite 600<br />

Schaumburg, IL 60173<br />

(888) 437-4968<br />

www.ifsworld.com<br />

Indus International Inc.<br />

3301 Windy Ridge Parkway<br />

Atlanta, GA 30101<br />

(770) 952-8444<br />

www.indus.com<br />

Intenia Americas<br />

Two Century Plaza<br />

1700 East Golf Road, Suite 900<br />

Schaumburg, IL 60173<br />

(847) 762-0900<br />

www.intentia.com<br />

Ivara Corporation<br />

935 Sheldon Court<br />

Burlington, ON L7L 5K6, Canada<br />

(877) 746-3787 x312<br />

www.ivara.com<br />

Contact<br />

Gary Davies, Vice President, Sales<br />

(905) 632-8000 x263<br />

Brian Maguire, Vice President, Marketing<br />

(905) 632-8000 x311<br />

A leader in <strong>asset</strong> reliability solutions, Ivara<br />

combines advanced technology and reliability<br />

expertise to help utilities achieve and sustain a<br />

proactive, reliability-focused approach to <strong>asset</strong><br />

<strong>management</strong>. Ivara EXP software supports the<br />

<strong>asset</strong> reliability process – effectively managing<br />

<strong>asset</strong> health and ensuring the right work is always<br />

done on the right equipment, at the right time.<br />

With Ivara, customers can achieve higher returns<br />

on their <strong>asset</strong> investment and reduce costs while<br />

ensuring safety and environmental integrity.<br />

Lawson Software<br />

380 St. Peter Street<br />

St. Paul, MN 55102<br />

(651) 767-7000<br />

www.lawson.com<br />

LogicaCMG<br />

10375 Richmond Avenue, Suite 100<br />

Houston, TX 77042<br />

(713) 954-7000<br />

Fax (713) 785-0880<br />

www.logicacmg.com/us<br />

Contact<br />

Gary High, Vice President, Sales & Marketing<br />

(713) 954-7096<br />

Sue Wilson, Marketing Manager<br />

(713) 954-7308


Demand dramatic improvement—<br />

unify your workforce, <strong>asset</strong>s and culture<br />

LogicaCMG’s Asset & Resource Management (ARM) suite provides<br />

the foundation utilities need to achieve dramatic business<br />

improvements. With ARM, utilities can unify their workforce, <strong>asset</strong>s<br />

and culture to reduce costs and better manage their business.<br />

By optimizing the use of information and <strong>asset</strong>s with ARM,<br />

companies can produce significant operational changes and move<br />

to the next level of business benefits. ARM provides the critical<br />

information technology that supports smarter business decisions<br />

and enables a utility to stand out from the crowd.<br />

The ARM product suite includes work <strong>management</strong>, mobile<br />

computing, <strong>asset</strong> <strong>management</strong>, compliance tracking, dispatch,<br />

scheduling and reporting capabilities delivered as a pre-integrated,<br />

seamless solution.<br />

LogicaCMG is a major international force in IT services and wireless telecoms.<br />

It provides <strong>management</strong> and IT consultancy, systems integration and<br />

outsourcing services to clients across diverse markets including energy and<br />

utilities, telecoms, financial services, industry, distribution and transport and<br />

the public sector. For more information, contact us at 1-800-334-7101 or see<br />

www.logicacmg.com/us.<br />

SOLUTIONS THAT MATTER<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 53


For over 40 years, LogicaCMG has been a<br />

major international force in IT solutions, systems<br />

integration, consulting, products and services.<br />

LogicaCMG’s Asset and Resource Management<br />

(ARM) product suite combines work <strong>management</strong>,<br />

mobile computing, <strong>asset</strong> <strong>management</strong>, compliance<br />

tracking, dispatch, scheduling and reporting<br />

capabilities into a single, seamlessly integrated<br />

environment.<br />

From the office to the field, ARM streamlines<br />

a utility’s business processes, manages the entire<br />

work stream, controls operational costs, and<br />

manages maintenance and regulatory compliance<br />

activities.<br />

Mainpac<br />

10-12 Clarke Street, Suite 201<br />

Crows Nest, NSW 2065, Australia<br />

+ 61 2 9438 1411<br />

www.mainpac.com.au<br />

Mainsaver<br />

9890 Towne Centre Drive, Suite 100<br />

San Diego, CA 92121<br />

(858) 550-5300<br />

www.mainsaver.com<br />

Mincom<br />

9635 Maroon Circle<br />

Englewood, CO 80112<br />

(303) 446-9000<br />

Fax (303) 446-8664<br />

www.mincom.com<br />

Contact<br />

Marc Duame, Inside Sales Manager<br />

(303) 446-9000<br />

Utility organizations invest billions of dollars<br />

in <strong>asset</strong>s – from personnel to equipment. A single<br />

system to manage equipment maintenance,<br />

purchasing, finance and workforce planning<br />

is critical to ensure cost efficiency and quality<br />

service delivery.<br />

Mincom provides Enterprise Asset Management<br />

(EAM) and e-business solutions to power<br />

generation, transmission and distribution; water<br />

and wastewater; and gas utilities around the world.<br />

Mincom offers a range of consulting services<br />

delivered by experienced professionals with deep<br />

industry knowledge and implementation expertise.<br />

MRO Software<br />

100 Crosby Drive<br />

Bedford, MA 01730<br />

(800) 2 44-3346<br />

Fax (781) 280-2202<br />

54 ENERGYBIZ MAGAZINE July/August 2005<br />

[ C A S E S T U D Y ]<br />

www.mro.com<br />

Contact<br />

Ron Wallace, Industry Marketing Manager,<br />

Utilities<br />

(781) 280-6875<br />

Charles Maul, Enterprise Marketing Support<br />

Representative<br />

(770) 481-3070<br />

Jerry Schinski, Senior Sales Consultant<br />

(201) 909-3765<br />

MRO Software is the leading provider of<br />

strategic <strong>asset</strong> and service <strong>management</strong> solutions.<br />

Maximo Enterprise Suite, the company’s<br />

flagship solution, is delivered on a web-architected<br />

platform and increases productivity,<br />

optimizes <strong>asset</strong> performance, and service levels,<br />

reduces costs and enables <strong>asset</strong>-related sourcing<br />

and procurement across the entire spectrum of<br />

strategic <strong>asset</strong>s.<br />

MRO Software (Nasdaq: MROI) is a global<br />

company based in Bedford, Mass., with approximately<br />

900 employees, 10,000 customers and<br />

more than 260,000 end-users.<br />

NISC (National Information<br />

Solutions Cooperative)<br />

#1 Innovation Circle<br />

Lake St. Louis, MO 63376<br />

(866) 999-6472<br />

www.nisc.coop<br />

NewEnergy Associates, A Siemens Company<br />

400 Interstate North Parkway, Suite 1500<br />

Atlanta, GA 30339<br />

(770) 779-2800<br />

www.newenergyassoc.com<br />

Open Systems International, Inc.<br />

3600 Holly Lane North, Suite 40<br />

Minneapolis, MN 55447<br />

(763) 551-0559<br />

Fax (763) 551-0750<br />

www.osii.com & www.e-scada.com<br />

Contact<br />

Mary Jo Nye, Director of Business<br />

Development<br />

(763) 511-0559<br />

Open Systems International, Inc. (OSI)<br />

provides open and high performance solutions<br />

to utilities worldwide. These solutions include<br />

Supervisory Control and Data Acquisition<br />

(SCADA), Energy Management System (EMS),<br />

Generation Management System (GMS), and<br />

Distribution Management Systems (DMS), as well<br />

as individual software products for electric utility<br />

operation. OSI’s products include monarch, a<br />

Linux, Windows and Unix-based system platform<br />

and Osiris, a new Linux-based secure Remote<br />

Telemetry Unit.<br />

Oracle USA<br />

500 Oracle Parkway<br />

Redwood Shores, CA 94065<br />

(650) 506-7000<br />

www.oracle.com<br />

Peregrine Systems, Inc.<br />

3611 Valley Centre Drive<br />

San Diego, CA 91230<br />

(800) 638.5231<br />

www.peregrine.com<br />

Perfect Commerce<br />

850 NW Chipman Road, Suite 5050<br />

Lee’s Summit, MO 64063<br />

(816) 448-4444<br />

www.perfect.com<br />

Ramco Systems Corporation<br />

Crossroads Corporate Center<br />

3150 Brunswick Pike, Suite 100<br />

Lawrenceville, NJ 08648<br />

(609) 620-4800<br />

www.ramco.com<br />

R.W. Beck, Inc.<br />

1801 California Street, Suite 2800<br />

Denver, CO 80202<br />

(303) 299-5200<br />

www.rwbeck.com/emc<br />

SAP America, Inc.<br />

3999 West Chester Pike<br />

Newtown Square, PA 19073<br />

(610) 661-1000<br />

Fax (610) 661-8868<br />

www.sap.com<br />

Contact<br />

Leila Ahmed, leila.ahmed@sap.com<br />

Paul Jablon, paul.jablon@sap.com<br />

Carl Cross, carl.cross@sap.com<br />

SAP for Utilities is a set of state-of-the-art<br />

software solutions for utilities worldwide. The<br />

integrated, highly reliable, and scalable solutions<br />

enable the end-to-end <strong>management</strong> of business<br />

processes because they are built on the open<br />

architecture of the SAP NetWeaver platform.<br />

Today, in 70 countries around the globe, more<br />

than 950 leading electricity, gas, water, and<br />

municipality utilities in regulated, transitioning, and<br />

deregulated markets rely on SAP for Utilities.<br />

Soluziona<br />

Rosetree Corporate Center<br />

1400 North Providence Road, Suite 4005<br />

Media, PA 19063<br />

(610) 892-8920<br />

www.soluziona.us<br />

A D V E R T I S E M E N T


A D V E R T I S E M E N T<br />

[ C A S E S T U D Y ]<br />

Westar Energy Proves Knowledge is Power<br />

POSITIVE CHANGE<br />

Westar Energy, the largest electric energy provider in Kansas, is<br />

dedicated to providing its 650,000 customers with high quality<br />

service at below average prices. Although Westar Energy has<br />

received national recognition for maintenance and performance,<br />

the utility’s seven energy centers were constrained by homegrown<br />

mainframe information systems and reactive maintenance<br />

practices. The Company’s executives knew they could do better.<br />

They set out to grow best-in-class maintenance organizations.<br />

A select team of Westar Energy employees was created as a task<br />

force to plan the foundation for positive change. Goal-driven metrics<br />

were identified, and a new Enterprise Asset Management (EAM) system<br />

was chosen and put into place. David Walter, Engineer VI in Westar<br />

Energy’s “Engineering Reliability” department explains, “If you can<br />

measure against a goal, you can fix and improve the process. Metrics<br />

force the issue and fuel an environment of continuous improvement.”<br />

The value of this strategy became immediately apparent, and the utility<br />

expanded the EAM initiative over the next four years to include additional<br />

processes, modules, reports, and increasingly aggressive goals.<br />

THE SOLUTION<br />

In 1998, Westar Energy chose SPL WorldGroup’s Enterprise Asset<br />

and Work Management (SPL EAM, formerly known as the Synergen<br />

Series®), to replace its legacy systems. SPL EAM was selected<br />

over other vendor solutions because of its user friendliness, robust<br />

features, configurability, and low overall total cost of ownership. The<br />

application would enable standardized work practices and data formats<br />

across Westar Energy’s seven energy centers.<br />

In less than two years, all sites were live on SPL EAM and maintenance<br />

managers were ready to implement a new, three-pronged<br />

approach to power plant maintenance:<br />

1. Improve Planning and Scheduling: Westar Energy wanted<br />

to modernize its maintenance system and organization by<br />

implementing best practice work planning and scheduling.<br />

2. Integrate Maintenance and Supply Chain: Purchasing<br />

and inventory organizations would be a more closely<br />

integrated partner in support of maintenance efforts.<br />

3. Measure and Improve Results: The utility sought to<br />

increase accessibility of information and better manage<br />

results by establishing goals and performance metrics.<br />

Westar Energy’s greatest challenge involved the cultural/<br />

behavioral and procedural changes necessary to successfully<br />

implement goal-driven practices. Metrics would determine where<br />

weaknesses existed, and procedures would be implemented to<br />

improve performance. Personnel throughout the fleet were motivated<br />

to work together to overcome each limitation in pursuit of<br />

maintenance excellence.<br />

MEASURING SUCCESS<br />

SPL EAM serves Westar Energy work <strong>management</strong> needs, in the<br />

areas of work and project planning, scheduling, permitting, timekeep-<br />

ing, purchasing, inventory control, and more. Every transaction that<br />

occurs in a power plant is sent to the general ledger via SPL EAM.<br />

Using the data collected and stored in SPL EAM, Westar Energy<br />

executives are now able to track and measure performance and chart<br />

progress toward maintenance practice improvement goals.<br />

Westar Energy’s plant maintenance departments perform<br />

approximately 30,000 work order tasks per year and generate about<br />

17,000 work schedules annually. The utility has met several of its<br />

“This year we met our goal for the<br />

percentage of hours spent on predictive<br />

and preventive activities, and we will<br />

very likely raise the bar next year.”<br />

goals in transitioning from reactive maintenance to a more planned<br />

and scheduled environment, and was able to build upon its success<br />

by measuring and improving work package planning, advance<br />

scheduling, schedule compliance, planned materials percentages,<br />

and related metrics. According to Walter, “About 18% of our maintenance<br />

work is currently unscheduled. Recognition of, and visibility<br />

into, the inefficiency of unscheduled work is helping us to change<br />

our work culture.” He adds, “This year we met our goal for the percentage<br />

of hours spent on predictive and preventive activities, and<br />

we will very likely raise the bar next year.”<br />

Westar Energy’s materials and purchasing organizations also<br />

tended to be reactive. With metrics this is changing. The utility<br />

stocks nearly 60,000 SKUs in its warehouses and executes more<br />

than 17,000 purchase orders each year. Objectives such as reduced<br />

inventory, increased use of blanket purchase orders, achieving consignment<br />

goals, and meeting required dates are measured. Westar<br />

Energy’s Generation Business Analyst, Sue Gordon says, “The<br />

internal lead time from requisition generation to purchase order<br />

issue has been dramatically reduced. Replacing previously arduous<br />

tasks with the capabilities of SPL EAM made this possible.”<br />

EFFICIENCY OF INFORMATION BREEDS SUCCESS<br />

Walter concludes, “We’ve always felt that our maintenance organizations<br />

were effective. Today though, with the help of the SPL EAM<br />

solution and a strong focus on continual improvement in our work<br />

<strong>management</strong> process, we are even better. We are far more efficient in<br />

collecting intelligence now. Having ‘exploded’ in this respect is proving<br />

invaluable to our efforts. We now have the ability to continuously evaluate<br />

our progress and raise the standard as we meet our goals. The end<br />

result is a more efficient operation, more reliable service, and greater<br />

customer satisfaction.”<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 55


SPL WorldGroup, Inc.<br />

525 Market Street, 33rd Floor<br />

San Francisco, CA 94105<br />

(415) 963-5600<br />

Fax (415) 963-5601<br />

www.splwg.com<br />

Contact<br />

Cathy McCause, Vice President, Marketing<br />

(925) 658-1056<br />

SPL WorldGroup delivers a leading Enterprise<br />

Asset Management software solution — SPL<br />

Enterprise Asset and Work Management (SPL<br />

EAM) — for collaborative work <strong>management</strong> and<br />

<strong>asset</strong> optimization across the enterprise. SPL<br />

EAM is also available as part of an integrated suite<br />

of best-in-class utility-specific software solutions<br />

including SPL Customer Care & Billing, Mobile<br />

Workforce Management, and Outage and Distribution<br />

Management that helps utilities around the<br />

world achieve competitive advantage while ensuring<br />

a lower total cost of technology ownership.<br />

Southeastern Data Cooperative, Inc.<br />

2100 East Exchange Place, Suite 300<br />

Tucker, GA 30084<br />

(770) 414-8400<br />

www.sedata.com<br />

TMA Systems, LLC<br />

5100 East Skelly Drive, Suite 900<br />

Tulsa, OK 74135<br />

(918) 858-6600<br />

www.tmasystems.com<br />

Xtensible Solutions<br />

PO Box 372969<br />

Satellite Beach, FL 32937<br />

(321) 777-3789<br />

Fax (321) 777-3810<br />

www.xtensible.net<br />

Contact<br />

Greg Robinson, President & CEO<br />

(321) 777-3789<br />

Joe Zhou, CTO<br />

(303) 229-4328<br />

Terry Saxton, VP Special Projects<br />

(763) 473-3250<br />

Achieving your <strong>asset</strong> <strong>management</strong> objectives<br />

will require unambiguous information to be shared<br />

among many applications and users. Xtensible<br />

Solutions offers the Model Driven Integration (MDI)<br />

Framework to meet this requirement in a timely and<br />

cost-effective manner. MDI provides the process<br />

and capability whereby your enterprise can lever-<br />

56 ENERGYBIZ MAGAZINE July/August 2005<br />

age a common language for <strong>asset</strong> <strong>management</strong><br />

goals and objectives, roles and responsibilities,<br />

and <strong>asset</strong> performance metrics that are understood<br />

and correctly used across your enterprise.<br />

MAINTENANCE MANAGEMENT<br />

ABB Inc.<br />

940 Main Campus Drive<br />

Raleigh, NC 27606<br />

(800) 919-4995<br />

www.abb.com/us<br />

Burns & McDonnell<br />

9400 Ward Parkway<br />

Kansas City, MO 64114<br />

(816) 333-9400<br />

Fax (816) 333-3690<br />

www.burnsmcd.com<br />

Contact<br />

Doug Riedel, Associate Vice President<br />

(816) 822-3391<br />

Jeff Greig, Associate Vice President<br />

(816) 822-3392<br />

Founded in 1898, Burns & McDonnell is a fullservice<br />

engineering, construction, environmental<br />

and consulting solutions firm.<br />

The company’s multi-disciplined staff of<br />

more than 1,800 includes engineers, architects,<br />

contractors, planners, estimators, economists,<br />

technicians and scientists, representing virtually<br />

all design disciplines. Burns & McDonnell plans,<br />

designs, permits, constructs and manages facilities<br />

all over the world with one mission in mind<br />

— to make our clients successful.<br />

Camcode Barcode Labels<br />

18531 South Miles Road<br />

Cleveland, OH 44128<br />

(800) 627-3917<br />

www.camcod.com<br />

Caver-Morehead Systems, Inc.<br />

5000 Legacy Drive, Suite 170<br />

Plano, TX 75024<br />

(972) 599-9330<br />

www.caver-morehead.com<br />

Cetaris<br />

41 Constellation Court<br />

Toronto, ON L0G 1J0, Canada<br />

(416) 679-9555<br />

www.cetaris.com<br />

Engica Technology<br />

Newcastle Technopole<br />

Kings Manor, Newcastle upon Tyne, NE1 6PA<br />

United Kingdom<br />

+ 44 (0) 191 201 7777<br />

www.engica.com<br />

har*GIS Field Information Systems<br />

6551 South Revere Parkway, Suite 210<br />

Centennial, CO 80111<br />

(303) 220-0253<br />

www.truckmap.com<br />

Harris Computer Systems<br />

1 Antares Drive, Suite 400<br />

Ottawa, ON K2E 8C4, Canada<br />

(613) 226-5511<br />

www.harriscomputer.com<br />

LinearVision, LLC<br />

198 Van Buren Street, Suite 120<br />

Herndon, VA 20170<br />

(250) 388-0500<br />

www.linearvision.com<br />

LogicaCMG<br />

See complete listing on page 52<br />

Meridium<br />

10 South Jefferson Street<br />

Roanoke, VA 24011<br />

(540) 344-9205<br />

www.meridium.com<br />

SMGlobal Inc.<br />

2911 Waterford Forest Circle<br />

Cary, NC 27513<br />

(919) 434-5146<br />

www.smglobal.com<br />

SW IMPLEMENTATION/SYSTEMS INTEGRATION<br />

SERVICES<br />

Accenture<br />

128 Third Street South<br />

St. Petersburg, FL 33701<br />

(727) 897-7000<br />

www.accenture.com<br />

AMEC Americas Limited<br />

2020 Winston Park Drive<br />

Oakville, ON L6H 6X7, Canada<br />

(905) 829-5400<br />

www.amec.com<br />

Deloitte<br />

127 Public Square, Suite 3300<br />

Cleveland, OH 44114<br />

(216) 589-1300<br />

www.deloitte.com/us<br />

Delve Energy Group LLC<br />

855 Foxberry Farms Road, Suite 200<br />

Minneapolis, MN 55340<br />

(763) 478-3580<br />

www.delveenergy.com


www.energybizmag.com ENERGYBIZ MAGAZINE 57


Doble Engineering Company<br />

85 Walnut Street<br />

Watertown, MA 02472<br />

(617) 926-4900<br />

www.doble.com<br />

Enspiria Solutions, Inc.<br />

10475 Park Meadows Drive, Suite 200<br />

Littleton, CO 80124<br />

(303) 741-8400<br />

Fax (303) 799-6766<br />

www.enspiria.com<br />

Contact:<br />

Hahn Tram, Executive Consultant<br />

(303) 521-3055<br />

Mehrdod Mohseni, VP, Business Development<br />

(303) 521-5395<br />

Chip Scott, EVP, Operations<br />

(303) 949-6144<br />

Enspiria Solutions provides consulting and<br />

systems integration services to help utilities plan and<br />

implement technology-enabled solutions including:<br />

Asset Management, Geographic Information Systems,<br />

Automated Meter Reading, Substation Automation,<br />

Outage Management, Work Management,<br />

and Mobile Field Dispatch. Our experts offer a range<br />

of Asset Management services to enable clients<br />

to succeed across their T&D enterprise including<br />

reliability <strong>management</strong> solutions, investment project<br />

prioritization, performance benchmarking, key performance<br />

indicators, and executive dashboards.<br />

ICF Consulting<br />

9300 Lee Highway<br />

Fairfax, VA 22031<br />

(703) 934-3637<br />

www.icfconsulting.com<br />

KEMA One Burlington Business Center<br />

67 South Bedford Street, Suite 201<br />

East Burlington, MA 01803<br />

(781) 273-5700<br />

Fax (781) 299-4867<br />

www.kema.com<br />

Contact<br />

Jennifer Krabbenhoeft, Director, Strategic<br />

Marketing<br />

(303) 708-9355<br />

Kristen Brewitt, Corporate Communications<br />

(781) 273-5700<br />

KEMA offers technical and <strong>management</strong><br />

consulting, testing, inspections, certification, and<br />

58 ENERGYBIZ MAGAZINE July/August 2005<br />

training services to more than 500 electric and utility<br />

industry clients in 70 countries. KEMA applies<br />

global experience and regional insight in offering a<br />

full complement of services supporting generation<br />

through the consumer side of the meter. Headquartered<br />

in Arnhem, the Netherlands with subsidiaries<br />

and offices worldwide, KEMA employs more than<br />

1,500 full-time professionals and leading experts in<br />

many facets of the energy utility industry.<br />

LogicaCMG<br />

See complete listing on page 52<br />

Navigant Consulting, Inc.<br />

615 North Wabash Avenue<br />

Chicago, IL 60611<br />

(800) 621-8390 x5736<br />

www.navigantconsulting.com<br />

PA Consulting<br />

1750 Pennsylvania Avenue NW<br />

Washington, DC 20006<br />

(202) 442-2000<br />

www.paconsulting.com<br />

POWER Engineers<br />

1295 South Eagle Flight Way<br />

Boise, ID 83709<br />

(208) 685-6355<br />

www.powereng.com<br />

Radio Satellite Integrators<br />

19144 Van Ness Avenue<br />

Torrance, CA 90501<br />

(310) 787-7700<br />

www.radsat.com<br />

Telemetric Corporation<br />

9941 West Emerald Street<br />

Boise, ID 83704<br />

(208) 658-1292<br />

www.telemetric.net<br />

UMS Group Inc.<br />

20 Waterview Boulevard<br />

Parsippany, NJ 07054<br />

(973) 335-3555<br />

www.umsgroup.com<br />

BUSINESS PROCESS<br />

Boreas Group LLC<br />

730 South Elizabeth Street<br />

Denver, CO 80209<br />

(303) 744-2108<br />

www.boreasgroup.com<br />

Bottom Line Impact<br />

1040 North Michigan Avenue<br />

Pasadena, CA 91104<br />

(626) 794-7894<br />

www.bottomlineimpact.com<br />

E3 Consulting, LLC<br />

3333 South Bannock Street, Suite 500<br />

Englewood, CO 80110<br />

(303) 762-7070<br />

www.e3co.com<br />

Elevon<br />

500 West Madison, Suite 1600<br />

Chicago, IL 60661<br />

(312) 258-6000<br />

www.elevon.cc<br />

GE Energy<br />

4200 Wildwood Parkway<br />

Atlanta, GA 30339<br />

(678) 844-5476<br />

www.gepower.com<br />

Hannon Armstrong<br />

1997 Annapolis Exchange Parkway<br />

Annapolis, MD 21401<br />

(410) 571-9860<br />

www.hannonarmstrong.com<br />

INOVx Solutions<br />

17701 Cowan, Suite 260<br />

Irvine, CA 92614<br />

(949) 752-3700<br />

www.inovx.com<br />

Invensys<br />

33 Commercial Street<br />

Foxboro, MA 02035<br />

(508) 543-8750<br />

www.invensys.com<br />

Itron 2818 North Sullivan Road<br />

Spokane, WA 99216<br />

(800) 635-5461<br />

www.itron.com<br />

Ivara Corporation<br />

See complete listing on page 52<br />

MCR Performance Solutions<br />

400 Skokie Boulevard, Suite 375<br />

Northbrook, IL 60062<br />

(847) 562-0066<br />

www.mcr-group.com<br />

Panasonic Computer Solutions Company<br />

50 Meadowlands Parkway<br />

Secaucus, NJ 07094<br />

(800) 662-3537, Option 5<br />

www.panasonic.com/toughbook/utilities<br />

Contact<br />

utilities@p2c2.com<br />

(800) 662-3537, Option 5


© 2005 Enspiria Solutions, Inc., an Osmose company.<br />

The Zen of Asset Management<br />

Hahn Tram – Student of eastern philosophies, father of two, collector<br />

of toy pigs, recipient of the Westinghouse Engineering Achievement<br />

award, foremost industry expert on utility <strong>asset</strong> <strong>management</strong>.<br />

While others fret, deliberate and struggle with the uncertainties of<br />

<strong>asset</strong> <strong>management</strong>, Hahn applies the same calm intelligence,<br />

enlightened intuition and clear comprehension that pervade all aspects<br />

of his life. And while elsewhere confusion may reign, Hahn’s confident<br />

experience make him always mindful of that which has come before,<br />

and that which is likely to follow. Ever aware of the need for balance,<br />

Enspiria’s Hahn Tram is the Zen of <strong>asset</strong> <strong>management</strong>.<br />

Real People with Inspired Solutions to Real Problems<br />

www.enspiria.com • 303.641.2968<br />

For over fifteen years, Panasonic Computer<br />

Solutions Company has produced the industry’s<br />

most dependable mobile PCs—legendary Panasonic<br />

Toughbooks®. Toughbook reliability assures<br />

utility industry professionals maximum uptime and<br />

a significantly lower total cost of ownership. With<br />

durability built into every seal, hinge and connector,<br />

Toughbooks offer the highest reliability rates in the<br />

industry. Toughbooks are ideal whether you’re up in<br />

the bucket, above or below ground or driving over<br />

rural roads.<br />

Toughbooks’ rugged features are unmatched<br />

for durability, with magnesium alloy cases, shockmounted<br />

hard drives and moisture- and dust-resistant<br />

LCDs and keyboards. And with integrated<br />

wireless capabilities, utility workers are able to<br />

receive work orders and make schedule changes<br />

in the field, dispatch and manage crews from<br />

virtually anywhere and instantly access customer<br />

service histories and inventory information.<br />

Platts UDI<br />

1200 G Street NW, Suite 1000<br />

Washington, DC 20005<br />

(202) 942-8788<br />

www.platts.com<br />

Powerlink Corporation<br />

20 South Santa Cruz Avenue, Suite 320<br />

Los Gatos, CA 95030<br />

(408) 399-3355<br />

www.powerlink.com<br />

Sargent & Lundy LLC<br />

55 East Monroe Street<br />

Chicago, IL 60603<br />

(312) 269-2000<br />

www.sargentlundy.com<br />

SmartSignal Corporation<br />

901 Warrenville Road<br />

Lisle, IL 60532<br />

(630) 829-4000<br />

www.smartsignal.com<br />

MAINTENANCE OUTSOURCING<br />

Asset Management Consulting Limited<br />

221 St. John Street<br />

Clerkenwell, London, EC1V 4LY<br />

United Kingdom<br />

+ 44 (0) 20 7688 2828<br />

www.amcl.com<br />

OTHER<br />

SensorLink Corporation<br />

PO Box 301<br />

1975 Valley Highway #9<br />

Acme, WA 98220<br />

(360) 595-1000<br />

Fax (360) 595-1001<br />

www.sensorlink.com<br />

Contact<br />

Ken Borbe, Director of Marketing & Sales<br />

(360) 595-1000<br />

Manufactures meters, sensors, and recorders<br />

for primary voltage. They read current, voltage,<br />

power factor, harmonics, and micro-ohms resistance.<br />

They record profiles including current and<br />

power factor.<br />

Our sensors measure in high voltage environments<br />

where a traditional potential or current<br />

transformers may not be the answer. Our research<br />

team is dedicated to designing high quality, easy to<br />

use sensors that give the right answer. Past projects<br />

include: Open core current transformers, Non-Contact<br />

power factor sensors and Current sensors for<br />

special SCADA applications.<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 59


[ C A S E S T U D Y ]<br />

Asset Management:<br />

Optimized Business Use of Aging System<br />

Information Base<br />

INTRODUCTION<br />

Oklahoma Electric and Gas is completing implementation of a<br />

comprehensive <strong>asset</strong> <strong>management</strong> framework for its distribution<br />

business unit. Working with KEMA T&D Consulting, OG&E has<br />

implemented a method based on a unique approach to T&D system<br />

<strong>management</strong> that incorporates an aging infrastructure model<br />

into its investment, utilization and maintenance decision-making<br />

processes. Its approach also applies an option-based portfolio<br />

optimization method to maximize “bang for the buck” performance<br />

enhancement of its power delivery operations.<br />

OG&E moved to <strong>asset</strong> <strong>management</strong> to improve business performance.<br />

According to Terry Henry, Leader of Strategy, OG&E<br />

Electric Services, “Asset <strong>management</strong> is a change from traditional<br />

engineering standards and operations-guideline driven approach<br />

for decision making and spending to a <strong>management</strong> system that<br />

coordinates all decisions to maximize their joint contribution to the<br />

corporate business case. We believed it would help us focus on<br />

achieving maximum performance for our customers, our stockholders,<br />

and our employees.”<br />

Henry further notes that OG&E knew from the outset that it also<br />

needed to look at the issues and trends it faced due to continuing<br />

wear and tear on an aging T&D system. “We saw trends in our cost<br />

and operations data that indicated potential rising costs and reliability<br />

problems down the road. OG&E wanted to get out in front of<br />

such trends before they became problems. An <strong>asset</strong> <strong>management</strong><br />

approach seemed the ideal way to put any such problems in a business<br />

perspective and to optimize their solution.”<br />

“KEMA had a solid,<br />

fact-based methodology<br />

to address the aging<br />

infrastructure issues and<br />

made a good argument<br />

for including those issues<br />

directly in the <strong>asset</strong><br />

<strong>management</strong> project.”<br />

PROPER TEAMWORK WAS A KEY<br />

OG&E assembled a team that cut across all relevant departments<br />

and backgrounds. They also went outside the company<br />

for expertise that could help them do the job quickly and well.<br />

“OG&E picked KEMA because it had a solid background in business-based<br />

<strong>asset</strong> <strong>management</strong> approaches,“ said Henry. “We<br />

were confident they would listen to us and work with us toward<br />

our goals and needs. KEMA had a solid, fact-based methodology<br />

60 ENERGYBIZ MAGAZINE July/August 2005<br />

to address the aging infrastructure issues and made a good argument<br />

for including those issues directly in the <strong>asset</strong> <strong>management</strong><br />

project.” OG&E and KEMA also worked closely with ABB Power<br />

Technology Services, which provided expertise and support in<br />

evaluation, diagnosis, and condition assessment of major electrical<br />

equipment like transformers and breakers.<br />

AGING INFRASTRUCTURES:<br />

DURABILITY VERSUS JUST RELIABILITY<br />

Lee Willis, Vice President of Asset Management and Planning for<br />

KEMA T&D Consulting, says that equipment aging and its effects<br />

are not well understood in the power industry, particularly their<br />

interaction with business performance. “When people talk about<br />

aging, they use it as a proxy for condition deterioration. Age and<br />

time in service create wear and tear that gradually erodes condition.”<br />

But age itself is a good thing, Willis insists. “An optimum<br />

business strategy means getting the most value out of everything<br />

the utility owns or buys, and that means making it last as long as<br />

practicable.”<br />

Working with utilities in Europe and the US, KEMA developed a<br />

unique “sustainable point” durability analysis of historical <strong>asset</strong> base<br />

operating data, which projects future changes in condition, failure<br />

rates, repair and replacement costs. The utility can see where, how,<br />

and why its costs and reliability challenges will change over time or<br />

as a function of decisions made about utilization and maintenance.<br />

Willis explains the approach finds an optimum sustainable business<br />

case. “There is an optimum age or condition profile for each class<br />

and type of equipment in the system, one most compatible with the<br />

utility’s business needs. Even fifty-year old poles and transformers<br />

can have decades of life remaining in them if well serviced. A utility<br />

that has the right base of information can determine where and how<br />

to allocate budget and scarce resources to do the best job of getting<br />

value out of its <strong>asset</strong>s, old and new.”<br />

A utility must be pro-active, and work hard, to get maximum<br />

value from its older equipment. “Older equipment can be a lot like<br />

older people,” explains Randy Schrieber, Senior Vice President,<br />

Power Technology Services, at ABB, whose group did much of<br />

the project’s major equipment evaluation. “It can go from good<br />

condition to bad more quickly than new. It’s prone to more frequent<br />

breakdowns. So you have to inspect and monitor it a bit<br />

more frequently, and maybe perform more maintenance. You have<br />

to balance those costs, remaining life, and risk of failure against<br />

the cost of replacement. This means a lot hinges on your understanding<br />

of the equipment’s condition.”<br />

OG&E’s Henry agrees, adding that the utility needs to look beyond<br />

just its equipment cost and lifetime issues, at Operations costs and<br />

performance issues, too. The optimum way to provide good service<br />

quality to customers might be to learn to ‘live with’ a slightly rising<br />

failure rate from aging equipment through improved operations. “You<br />

might eliminate the effects of aging trends on customer service by<br />

improving response and restoration – by more efficiently handling<br />

high outage rates.”<br />

A D V E R T I S E M E N T


A D V EE RR TT II SS E M E N T<br />

TAKE BUDGET OUT OF PROJECTS,<br />

[ C A S E S T U D Y ]<br />

NOT PROJECTS OUT OF THE BUDGET<br />

The best way to balance all these disparate issues is by using a<br />

rigorous <strong>asset</strong> <strong>management</strong> approach to select the best matching<br />

set of programs and strategies, says KEMA’s Willis. “But the<br />

key point, based on the results I’ve seen, is that you can’t ignore<br />

equipment aging trends if you’re trying to do effective <strong>asset</strong> <strong>management</strong>.<br />

The two go hand in hand.”<br />

Zac Hager, Strategy and Total Quality Engineer with OG&E’s<br />

Asset Management team, notes that KEMA helped his team apply<br />

two other features that further improve <strong>asset</strong> <strong>management</strong>. “First, we<br />

think in terms of three budget areas, investment, maintenance, and<br />

operations, rather than two.” On KEMA’s advice, the traditional O&M<br />

area is viewed as two separate spending areas that buy different<br />

types of performance. Inspection and maintenance extend equipment<br />

lifetime and lower failure rate. Operations budget improves response<br />

and restoration to lessen the effects of escalating failure rates. “It can<br />

make better business sense to prepare and be able to react well,”<br />

he says, “than to try to lower breakdown rates. The key, always, is to<br />

balance and target spending and resources across those areas well.<br />

Second, OG&E’s <strong>asset</strong> <strong>management</strong> framework uses an optionbased<br />

approach which allows it create extra leverage as it balances<br />

activities and investment areas.”<br />

KEMA’s Willis notes that several utilities have reported rather<br />

disappointing results from <strong>asset</strong> <strong>management</strong>. “In every case they<br />

were using an <strong>asset</strong> <strong>management</strong> portfolio method to prioritize or<br />

optimize projects defined and scoped in the traditional manner.<br />

That just doesn’t work. If the traditional project paradigm goes<br />

in, traditional results come out. You have to set up a system that<br />

will take budget out of projects, not projects out of the budget.”<br />

The secret is creating a set of flexible, performance-based project<br />

options guidelines to replace the traditional engineering standards<br />

approach to the assessment of needs and specification of project<br />

design. “There are always several ways to do any project,”<br />

Willis adds, each with different costs and different results. Halfmeasures<br />

sometimes deliver far more than half results, and are<br />

a preferred approach. Other times ‘gold-plating’ will be justified<br />

based on what it brings. “The key is to let the portfolio optimization<br />

see those options, their cost and results differences, and make the<br />

decision about how to best balance all options from all considerations.”<br />

Do that, Willis says, and the utility will get the big impacts<br />

its upper <strong>management</strong> is expecting.<br />

Doug Patterson, Senior Planner at OG&E, and project manager<br />

for the effort, reports that a third of the project involved<br />

determining how to construct project and program options objectively,<br />

comprehensively, and efficiently. “Absolutely nothing can be<br />

untouchable when it comes to cost reduction. Remember, if you’re<br />

taking money from one place it’s because you want spend it where<br />

it will provide more value. It’s all to make the greatest contribution<br />

to overall company business goals.”<br />

OG&E also uses its portfolio optimization to select the penetration<br />

of maintenance and technology programs. “A big part<br />

of our planned performance improvement is based on what you<br />

might call optimized cherry picking,” Patterson adds. “We don’t<br />

have to inspect all breakers if we can target the ones that need<br />

service. Some feeder line switches produce six times the ‘bang’<br />

when you automate them compared to others.” Patterson’s team<br />

entered such programs in targeted 10 percent increments and let<br />

the optimization determine penetration and timing.<br />

“The key is to let the<br />

portfolio optimization<br />

see those options, their<br />

cost and results<br />

differences, and make<br />

the decision about how to<br />

best balance all options<br />

from all considerations.”<br />

GOOD RESULTS<br />

“This project has gone a long way toward helping OG&E prepare<br />

for the future,” OG&E’s Henry reports. The biggest impact may not<br />

be the technical, but rather the institutional and team understanding<br />

OG&E gained. “This project helps us take a business basis<br />

in our decision-making and focus on coordinating our activities<br />

so all decisions are coherent.” And OG&E gained a firm handle<br />

on system aging and how to manage for the inevitable results of<br />

wear and tear on its system. “We better understand what we face.<br />

We know what we know and what we don’t know, along with the<br />

priorities we should put on improving areas of our knowledge base<br />

and our system. Most important, we have a good roadmap for the<br />

future, for both IT and process improvements, and for how to invest<br />

and manage our T&D system going forward.”<br />

www.energybizmag.com ENERGYBIZ MAGAZINE 61


62 ENERGYBIZ MAGAZINE July/August 2005

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