38 ENERGYBIZ MAGAZINE July/August 2005
Managing Complexity EVERYONE KNOWS WHAT ASSET MANAGEMENT IS — THEY’RE JUST NOT SURE WHAT TO CALL IT. By Warren Causey Asset <strong>management</strong> seems to have as many names as there are vendors promoting it and utilities buying it. That’s because there is no one over-arching definition of the discipline. Is it enterprise resource planning (ERP)? Is it enterprise <strong>asset</strong> <strong>management</strong> (EAM)? Is it a system that produces process improvement from generation to the field? Is it inventory, financials, warehousing, wires and pipes, or people? What exactly constitutes an <strong>asset</strong>? Increasingly, utilities are determining that virtually everything they possess is an <strong>asset</strong> — from the information stored in automated systems, recorded on paper, or even communicated by word of mouth. The definition of <strong>asset</strong> <strong>management</strong> has shifted considerably since the early days when SAP, based in Germany, introduced the idea of “enterprise software” to U.S. companies back in the early- to mid-1990s. Considered prime targets, utilities were just coming out of a long slumber as regulated, protected, quasi-governmental organizations with great resources. Facing the very real risk of competition, utilities quickly realized that the “silo structure” of their information technology solutions wouldn’t work in the proposed new environment; nor would existing haphazard systems of locating, moving, and accounting for all kinds of <strong>asset</strong>s. Thus, SAP and other vendors began expanding their footprints to compete with SAP. They expected to take the industry by storm and eventually drive out niche players with all-encompassing, tightly integrated software packages. However, some strange things happened along the way to this planned vendor nirvana: collapse of deregulation in California; the demise of Enron and other corporate malfeasance; and the implosion of the wholesale energy market. One interesting phenomenon that resulted, besides the splintering of the enterprise <strong>asset</strong> <strong>management</strong> computing market, is most “energy companies” 40 ENERGYBIZ MAGAZINE July/August 2005 now want to be called “utilities” again. They also want to define, configure, and determine <strong>management</strong> of <strong>asset</strong>s on their own terms — not as some large vendors decided they should be defined. As a result, not only have SAP, Oracle, J.D. Edwards, PeopleSoft, and several others opted against creating monolithic “enterprise computing” empires at utilities, but also utility IT seems to be as splintered as ever — at least in the United States. The lineup of vendors also has changed considerably. First PeopleSoft acquired J.D. Edwards. Then Oracle acquired PeopleSoft. Traditional CIS/CRM vendor SPL WorldGroup acquired a smaller ERP/EAM vendor, Synergen, plus an OMS vendor, CES International, and now is playing in the “enterprise” <strong>asset</strong> <strong>management</strong> space. Several other ERP/EAM vendors have continued to broaden and expand their offerings to encompass more <strong>asset</strong>s. Indus International of Atlanta, for example, acquired a CIS from SCT and now calls its overall package “Service Delivery Management.” Utilities did catch on to the idea of having their systems communicate across the enterprise, but they have done so much “picking and choosing” that many enterprise or <strong>asset</strong> <strong>management</strong> vendors find themselves having to link to their competitors’ products at the same utility. One example of that trend is evident at Nashville Electric Service, which acquired Mincom software, an enterprise software vendor, and integrated it with PeopleSoft/Oracle. National Grid of New England is another case in point. Its U.S. operations run primarily on PeopleSoft, but its United Kingdom parent has a former (before the PeopleSoft merger) Oracle EAM solution. Lattice, a newly acquired gas subsidiary, employs SAP. The idea of enterprise <strong>asset</strong> or resource software has split into competing ERP and EAM paradigms. Both have enthusiastic advo-