"UK Power Networks operates critical national infrastructure and is owned by the Chinese," explains its Chief Information Officer, Andrew Bilecki. UK Power Networks is an electricity distributor for East Anglia, London and the South East of England.
"We supply 25% of the UK's population. It's an interesting business," Bilecki says of an organisation he's been with for the past three years. UK Power Networks is majority owned by Li Ka-shing, one of the richest men from Asia. Li's Cheung Kong Infrastructure Holdings business recently acquired Eversholt Rail Group for £1.1 billion and owns the Three mobile network. If the Eversholt deal gains approval, this Chinese company is in a powerful position of ownership of the UK's essential services. Bilecki describes the ownership structure as being impressively long-term, which is good news for a CIO of a utility company.
UK Power Networks' primary role is to take electricity from the National Grid and distribute it directly to homes and businesses in London, East Anglia and the South East of England, which has approximately eight million connections and customers. It has a direct relationship with these customers on matters such as fault restoration and new connections. Billing is conducted by the retailers.
"We try and make sure that we keep the lights on as best as we possibly can," Bilecki says of how his role really does live up to one of the mantras of being a CIO. In today's power-hungry world, UK Power Networks finds itself not only an asset operating business, but also having to be consumer focused. The past three winters have seen the UK suffer at the hands of increasingly extreme weather as a result of climate change. Over the winter of 2013-14, the UK was battered by high winds and floods, just a year after similar floods had affected other parts of the UK. The winters of 2010 and 2011 had the UK blanketed in levels of snow not seen for decades. It is clear talking to Bilecki that the planet's climate is a major factor in the organisation's business operations. In December 2014, industry regulator Ofgem forced UK Power Networks and generator SSE to pay an additional series of fines worth £3.3 million for the power cuts customers suffered during the storms of Christmas 2013.
"We have a curious relationship with the customer, as they don't pay us directly and that confuses the end customer. But over the years we have become more customer-centric, and Ofgem has encouraged that. We are trying to talk to customers a lot more through video, fault maps and social channels, so that we can push information out to mobile devices," Bilecki says of the lessons learned. He explains that as an industry, it is highly monitored for its planned and unplanned outages.
"We now sit right alongside the retailers and integrate services better, so that we can work more closely with local authorities. This means if there is an emergency, it is more seamless."
Bilecki joined UK Power Networks a year after it secured the contract to be primary electricity network for its three regions. The organisation was previously part of French energy retailer and nuclear power firm EDF. Since joining UK Power Networks, he's reshaped the relationship his technology team has with the organisation.
"IT is a bit like a utility business. We have logistics, call centres, assets and customers. So we are using the same reporting models, as it is good to talk to engineers about asset management," he says of how he has engaged the business in their language. "You base your asset principles on how you manage them and there's a little bit of sympathy from the business as a result. Nine out of 10 times, good communications will get you through any difficulties," he argues.
It makes sense, as all CIOs with legacy have the same challenges as a utility business. They have to supply a service, extract as much value from the assets as possible, those assets require varying levels of support and you have to be looking ahead for how you invest, justify and carry out a replacement for those assets, and more than likely move to a new operating model.
UK Power Networks was originally the EDF Energy Network business until EDF divested the business in November 2010. This meant Bilecki's initial responsibility was separating the technology estate from EDF, who he describes as very helpful. But IT had been unloved he says, so the separation "was never going to be fun", once completed. UK Power Networks faced the task of being the power supplier to the London Olympics in 2012, which went without a hiccup. With these big tasks out of the way, Bilecki and his team have begun to innovate within the business.
"We are halfway through our Business Transformation Programme, an end-to-end transformation to 'deliver the business we all want'. The Programme has an employee proposition of "improving, simplifying and reducing the numerous processes and systems that you use on a daily basis, so that it's easier for you to do your job," he explains.
"The scope of the programme is work management, asset management, customer service, new connections, supply chain, capital programme management, HR, finance and regulatory reporting. It's been a fantastic opportunity to look end-to-end across the three networks and look at the customer from delivery to feedback, and we've found that 70% of the business is ready for transformation.
"The programme is one of our main mechanisms to deliver our eight-year business plan, in which we set out to sustain delivery of a highly reliable, low-cost electricity network for our eight million customers; with high levels of customer satisfaction, and an industry-leading health and safety record.
"Virtually all our staff and supply chain will be impacted by the programme, with a suite of new business applications, as well as mobility devices and tools. We're just deploying algorithmic automation, so that our networks can work out what and where the breaks are and fix them. It's an opportunity to do things in a genuine end-to-end way and we have a really good level of business accountability for the transformation. Everyone on the executive team is responsible for the transformation programme. We also have fantastic engagement down through the organisation," he says of the positive culture towards change that exists at UK Power Networks.
"We've got the business sitting there and coming to workshops, so they are leading things like the GUI design for our mobile tools. One of our success measures is that the business gets the outcomes they want, but also that the feedback they give is positive.
"Everyone in an organisation has different priorities, so expecting a business to align all of its activities in line with a big-bang transformation programme is nonsense. We have adopted a more agile approach to transformation," he reveals of the ad hoc teams that include his technologists and partners, to deliver changes in achievable sizes that do not break the flow of business too dramatically.
Bilecki is also using the transformation programme to embrace shadow IT. In an organisation with a large number of engineers and technical experts shadow IT is inevitable. Bilecki is, however, clear that as the CIO, he has to sign off and justifies the organisation's technology P&L, so ultimately a contract will be brokered and signed off by the CIO. "If there is a need, we will always help."
"With the transformation programme, we have an opportunity to converge a set of shadow IT. We have some interesting models in recent years, such as end users working on some elements of SAP configuration. It was a lot quicker than some of our outsourced service provision, and they have the skills and knowledge to do it right first time. As CIO, you have to be comfortable that you have the right metric. I think a lot of people are creating a productivity tool to fill a gap, so it is often sensible that you embrace and containerise what they know. Stopping it makes no sense," he explains.
Bilecki has an opex of £30 million for operations and IT; and a capex of £20 million, which excludes the transformation spend. These may seem high, but the CIO is investing in corporate IT from devices to machine-to-machine implementations that will transform the use of information and technology literally in the field. Additionally, UK Power Networks operates a number of specialist operational technologies focused on the power provision market.
"The transformation programme is unusual in two ways, the first being that it is outcome-driven, with the systems integration partner contracted to deliver real results in line with 150 business and regulatory targets. The second being the delivery model, which ensures engagement from all directors, managers and staff through incentive and engagement mechanisms. In the way of examples, one of our five key measures of success is to ensure minimal business disruption, another is customer satisfaction with the end product," he explains.
"The only way to do this is to have an extremely flexible systems integrator. Enzen is relatively small, but we picked it for its commitment and flexibility.
"The big names in systems integration layer up a set of assumptions and everything is a debate from then on. Enzen is committed to the same business outcomes as we are and it has a say. In practice, it means it's exciting for us as there is a constant level of change, and it is good for the business," Bilecki says. He also counts GE, TCS, Vodafone, EE, CGI, Capgemini, and SAP as his suppliers, with Capgemini providing service management.
Bilkecki's team has been picking up a few accolades of late too for embracing digital methods, its Self Service Tools provide improved digital information services to electricity customers, as well as perspective businesses considering generation projects.
Following a relaunch of the organisation's website in 2012, UK Power Networks began a series of Agile sprints to create the Self Service Tools for business and private customers.
Private customers can now use a Fault Map and reporting tools, which support the use of digital photographs, to inform UK Power Networks of network issues.
"Self Service has reduced our direct and indirect customer service costs," reveals Bilecki. Previously, customers chose a call-back service from an outsourced provider, which charged UK Power Networks per enquiry.
Businesses considering entering the electricity generation market are now able to use Google Maps-based tools to identify network connection points that UK Power Networks operates and the cost of hooking up to the grid. Over 250 renewable energy developers and landowners have used the new tools, replacing a legacy process of submitting an application before they received an estimate of connection costs. This cost them both time and money, and in many cases the connection costs impacted the viability of the proposed scheme, leading to the withdrawal of the application. Since the release of the tool developers are able, for the first time in the UK, to pre-assess connection distances, complexity and the costs before submitting an application to create a power-generating business such as a wind farm.
Bilecki reveals his team is also working on ways to use weather modelling to assess the increasing impact of climate change on the network and to be able to better inform customers how long an outage will be. He adds that UK Power Networks has masses of data, and his team is looking at how that can be combined and used to improve information or services using network modelling.
Bilecki had worked with EDF once before in his career, working as Director of Business Improvement for three years until 2009 when he left to become the CIO Thames Water.
The energy production sector is at the low foot hills of major transformation, as sustainable energy systems gather interest and increasing economic viability. Recent reports show major technological developments in solar and energy storage technology are soon to enter the market and disrupt energy producers.
Bilecki and UK Power Networks have demonstrated strong foresight to use existing open data such as Google Maps alongside their own data about connections to the network to enable a new industry to grow. Sometimes transformative disruption isn't about reinventing your business or developing an entirely new market sector, sometimes it's about using the power of technology and information to enable, and benefit from, disruptive businesses powering up.