Broad changes are underway in energy and utilities organizations, many influenced by trends from other sectors. These shifts are pushing companies in utilities and oil and gas to rethink their approaches, creating new cross-industry dependencies and consumer interactions.

Working to Accommodate Changing Consumer Behaviors

Energy companies are responding to evolving consumer behavior. In utilities, the shift from viewing customers as ratepayers to treating them as consumers with retail-like expectations is evident. Consumers now expect flexible payment options, including online payments, recurring billing, and credit card acceptance. Utilities are also offering smart devices, like mobile-controlled thermostats, while oil and gas companies are rolling out loyalty programs at fuel stations.

Additionally, both industries are taking on advisory roles, helping consumers manage energy use and conservation, and entering the renewable generation market. In this, they’re increasingly relying on capital markets to address grid demand and stability challenges.

How Energy Companies Flipped the Switch on Electrification

The interaction between the energy and automotive industries is accelerating due to electrification. Consumers want fast EV charging and solutions to ease range anxiety. Oil and gas companies are adding EV charging stations alongside gas pumps, while utilities balance offering charging services with maintaining grid reliability. This deepening interplay between industries has driven companies to seek talent with cross-industry expertise.

Engineering Experience No Longer Needed for Executive Roles

Traditional pathways to leadership in energy companies, which often required engineering experience, are changing. We’re seeing executives from the automotive and retail sectors take on leadership roles in utilities. The focus is now on bringing in fresh perspectives and solutions from outside industries to meet evolving consumer needs.

Cross-Industry Expertise Is Critical to Partnership

As the energy landscape transforms, partnerships with companies that bring expertise from industries like automotive, manufacturing, and retail are becoming critical. These cross-industry collaborations are key to navigating the complex challenges and opportunities ahead.

If you’d like to learn more about tapping into expertise from other industries to accelerate your transformation, explore our industry expertise.

To dive into how we’re using cross-industry solutions to optimize the utilities industry, explore our energy and utilities expertise.

A major energy and utilities supplier has become the latest victim in a growing list of organizations targeted by cyberattacks. Without a quick response to an attack like this, energy companies can risk exposing customer data, cutting off energy supply, slowing or completely stopping operations, and more. 

According to the Department of Energy, the recent incident was responded to quickly, and had minimal lasting impact. However, these attacks are becoming increasingly frequent across industries, and the risks continue to grow. Let’s focus on one of the most common types of cybercrime: ransomware. 

Are Your Systems Susceptible to Malware? 

Ransomware attacks are pervasive, affecting various sectors including organizations like Colonial Pipeline, JBS Foods, and Kaseya. The most frequently targeted industries range from energy and finance to healthcare and entertainment. Malicious software, better known as malware, compromises network integrity by gaining access through phishing, stolen passwords, and other vulnerabilities. 

Ransomware-as-a-Service is a cybercrime business model made possible via modular business models with low barriers to entry, creating a wide market of perpetrators. These individuals are divided into developers who create the malware and affiliates who initiate the attacks, with profits split between them. 

It is crucial to be vigilant, with the most common defense being routine basic cybersecurity hygiene, such as implementing multi-factor authentication. Other tactics include adopting Zero Trust principles and preparing for potential attacks to minimize impact. While a good defense is wise, it is still essential to have a strong relationship between the government and private sector, with collaboration being of utmost importance. Companies must share information about breaches and their efforts to disrupt infrastructure with the support of law enforcement. 

Three Simple Ways to Prevent Cyberattacks 

Now that we have identified what makes malware like ransomware possible, let us address the best ways to avoid becoming a victim. We have broken the solution down into a few simple steps: 

1. Be prepared with a recovery plan – Make it incredibly challenging to access and disrupt your system. If you make an attack economically unfeasible, you have already avoided the threat. The goal is to avoid paying the ransom for privileges that might not be returned or using keys provided by attackers to regain access. While restoring corrupted systems can be burdensome, it is better than the alternative. 

1. Limit the scope of damage – By limiting privileged access roles, you reduce the number of entry points for attackers to acquire access to critical components of your business. If they can only gain access to pieces rather than the entire system, it will deter attackers from pursuing an escalated attack. 

1. Challenge cybercriminals as much as possible – This step should not interfere with steps 1 or 2, but it is essential to create as much friction as possible for potential attacks. Make it an uphill battle for intruders attempting to gain remote access, emails, endpoints, or accounts. If they do manage to get in, ensure they cannot escalate their privileges by implementing robust detection and response capabilities. 

Perficient’s team of experts is well-versed in these incidents and what can be done to prevent them. If you would like to begin mounting more serious defenses, explore our energy industry expertise and browse the many technology partners with which we work to give companies confidence in their security, like Microsoft. 

As oil and gas companies face a future of flux and rapid energy transition, remaining competitive requires either full-fledged digital transformation or major components of it. Specifically, automated workflows and connected worker solutions are improving the employee experience and productivity. Further, direct consumers are demanding digital experiences tailored to their expectations. In response, there is also a rising interest from these organizations to invest in CX as well as data and personalization. As a result, there has been a huge increase in modernization, diversification, and optimization of past digital investments.  

The Digital Oil and Gas Industry Landscape 

Digital transformation this deep and extensive requires a solutions partner with industry expertise and proven award-winning solutions. With unique priorities such as considering strategies to tackle the disruption caused by electric vehicle adoption and renewable energy demand, the time is now to find a partner who can assist with customer journey science insights, artificial intelligence, immersive experiences, regulatory compliance like ESG tracking and reporting, digital twin modelling, and more.   

Perficient was recently recognized yet again in a leading global technology research and advisory firm’s report featuring noteworthy digital solutions consultancies partnering with oil and gas companies across North America and Europe. We are committed to helping oil and gas companies accelerate and thrive in their strategies to transition to green technology and reduce carbon emissions. We’re proud to be recognized as a notable digital consultancy helping oil and gas companies stay competitive in an evolving landscape full of energy transition challenges. 

As oil and gas companies look across their product lifecycles and reimagine the way they go to market, Perficient has proven expertise in delivering world-class digital solutions for their needs. “Each oil and gas company faces its own unique set of challenges, and Perficient is poised to meet them where they are and partner with them throughout their transformations,” said John Latham, General Manager of Houston, Perficient. 

More Than 250 of the World’s Leading Energy Companies Have Trusted Us 

Perficient’s long-standing partnerships with oil and gas companies, as well as all other types of energy and utilities companies, have allowed its experts to build an impressive base of knowledge and solutions tailored to global energy organizations. Our work spans the depth and breadth of the industry’s challenges with impressive digital solutions for worker safety, automated workflows, data tracking and reporting, immersive experiences, and more.  

Learn more about Perficient’s oil and gas strategy and technology solutions. 

In a world of convenient, fast, and reliable products and services, utilities companies are pressured to meet digital-first demands. Despite the desire to meet these demands, legacy systems have been causing them to miss the mark on customer expectations. Further, utilities companies are expected to shift from commodity providers to sustainable and trusted energy value advisors. If that wasn’t enough, societal and governmental pressures require the integration of renewable energy – an additional challenge that opens new revenue streams if companies succeed in smart management of operations. 

To address this evolving ecosystem, utilities companies have been partnering with digital consultancies for support in IT modernization, customer experience excellence, asset management, and more. Due to our impact on the industry and capabilities in these areas, Perficient was recognized by a leading global technology research and advisory firm’s report comparing the competitive differentiators of utilities industry consultancies in North America. 

Partnering to Keep the Lights On 

When it comes to digital transformation across the value chain, consultancies with deep industry expertise like Perficient are best positioned to set utilities companies up for success. With this assistance, utilities companies can streamline operations to increase efficiency, lower costs, and improve customer experience. Perficient has recently focused on strategy and execution of data and analytics as well as machine learning and artificial intelligence – areas that utilities companies are seeking out partners with excellent capabilities in. 

Companies in the utilities industry have benefitted from our end-to-end capabilities, most notably when it comes to worker safety, energy transition, and customer experience. Using our deep industry expertise, Perficient has been transforming utilities companies by seamlessly integrating digital solutions while streamlining and updating existing technology. With our help, several of the largest utilities companies in the U.S. have improved their operations and answered consumer demands for better experiences with their power suppliers. 

Harnessing Digital Transformation to Revolutionize Power & Utilities

The connected worker is one use case for Perficient’s capabilities in mobile applications, data management, portals, and more. Morgan McNeal, director of management consulting, Perficient, remarked:

“Employee experience is a top priority in the industry, yet one of the most common problems we’ve seen utility companies face is worker safety. With the help of advanced digital tools, these organizations can ensure workers stay connected and informed”

Further, Perficient has helped utilities companies reimagine their role in decarbonization, including creating immersive experiences that educate and assist customers in their sustainability goals. Energy transition is an ongoing challenge for utility companies as decarbonization and sustainability are at top of mind for consumers. While there are many ways energy companies are addressing this, from renewable energy portfolios to electric vehicle charging stations, some are going directly to their customers as trusted advisors of energy usage. Sandeep Ghosh, Houston director, Perficient, said:

“Transforming from energy provider to energy advisors will help utility companies maintain relevance and customer experience excellence.” 

Transforming the Utilities Industry 

Perficient’s intimate partnerships with utilities companies have allowed its industry experts to build an impressive base of knowledge and solutions tailored to global energy organizations. Many times, Perficient has enabled companies to ensure worker safety, improve workflows, streamline reporting, enhance employee and customer experiences, and reduce costs, all with strategically implemented technology solutions.  

Learn more about Perficient’s utilities strategy and technology solutions. 

Decision-making is best done by humans, but generative AI can quickly and accurately present the right data and reports we need to make those decisions. The rise of generative artificial intelligence has led to the potential for end-to-end improvements in the utilities industry. With this boundless resource now more accessible to utilities companies, it is much easier to swiftly address problems as they arise, dive deeper into supply chain visibility and predictability, and improve services to customers.

Generative AI use cases are mainly limited by imagination, but here are a few of the many ways this tool can be applied for utilities.

Scheduling Utilities Workers Effectively

Employee schedules can be complex and difficult to manage, especially when the workforce is large and work is project-based. Instead of manually monitoring, scheduling, and adjusting employee working hours, artificial intelligence can gather and organize data on work hours and employee requests for time off, whether they’re done in advance or last minute. This data can then quickly be turned into reports, and the generative AI tool can generate working schedules following all the necessary parameters.

Predicting and Preventing Potential Problems

Generative AI is a helpful tool when combined with predictive maintenance. Utilities companies can avoid outages and incidents that affect customer access to power by using sensors to continuously monitor the performance characteristics of the equipment. These capabilities span fleet management and fixed plant. With full visibility of all equipment data, generative AI can create reports on performance, alert workers to potential issues, and automatically request maintenance and inspections to lower the outage and incidence rates.

Mapping the Best Routes for Maintenance and Repair

Route optimization and maintenance routing automation are also areas where generative AI can play a productive role. Where utilities companies formerly assigned employees in advance to appointments and assignments out in the field, generative AI can use data monitored in real-time to continuously adjust worker routes and schedules for maximum efficiency. For example, if one assignment is taking longer than expected, or a sudden traffic blockage has made it difficult for the formerly assigned worker to make it to an appointment, generative AI can quickly regenerate the schedule with an employee who can take care of an appointment closer to the time requested or help reroute the vehicle for a quicker arrival time.

Changing the Landscape of Worker Safety

The connected worker is another advancement helping utilities companies to stay more vigilant in worker safety, but generative AI can offer an additional boost. Artificial intelligence can now provide predictions based on data from real life by creating virtual simulations. As a result, utilities companies can plan installations and maintenance with much more confidence in the safety of the project without putting real employees at risk.

Reducing Cost and Labor with AI Call Centers and Virtual Assistants

Finally, generative AI can greatly reduce the cost and number of work hours that companies must plan to operate call centers. Utilities companies can greatly benefit from this due to high call volumes during outages and extreme weather events. Customers also appreciate having more than one way to access information about their utilities, so generative AI can assist them in retrieving accurate, real-time information through phone calls, online dashboards, and virtual assistants.

Powering the globe has never been easier with generative AI. Tap into Perficient’s utilities industry expertise and CX AI jumpstart to implement gen AI.

I was recently asked to help evaluate an IT department’s readiness for their company’s new strategic direction – the acquisition of multiple companies in a relatively short timeframe. The company’s acquisition strategy, while new for them, was not unusual or unexpected.

A recent publication by Deloitte notes that private equity firms expect to increase both the number and size of M&A deals in the coming year[1]. Sadly, the foresight to assess IT readiness (especially in the small/midsized business space) was unusual however, but I believe very wise.

IT systems and processes underlie all business functions. Depending on the strategy employed for a merger, the IT impacts could range from simple integrations all the way through to full systems integration/migration, as well as an extension of IT service delivery (e.g. systems support and operations) to the new acquisition.

Extending service delivery can be a major impact, especially when the companies in question are small to mid-sized businesses. A single merger in that space can easily represent a 25% or larger increase in the IT footprint (measured in IT-enabled workers, infrastructure and systems).

Because IT systems and processes underlie all business functions, the impact of poor post-merger integration goes far beyond the IT department into core areas of the business.

I have worked to correct major IT integration issues in the past, and a particular example springs to mind from the mid-sized construction space. A construction company bought another in an adjacent market, a move which was strategic and had high value. However, planning for post-merger integration almost entirely left out IT readiness.

The results:

• Major differences in business processes led to a desire to integrate systems rather than migrate the acquired company. However, IT was not ready or able to handle system integrations. This had numerous knock-on effects:
  • Financials could not be systematically rolled up. Monthly, quarterly and year-end closing processes, as well as bank filings, were manually intensive for 24 months after the merger.
  • Responses to financial audits were also labor-intensive, and as a result were significantly higher risk/lower confidence.
  • Operations processes suffered as well, and the business had to resort to using temporary labor/manual effort in order to keep operations from slowing.
• Lack of readiness and planning to extend IT services (help desk, desktop support, employee onboarding/off-boarding etc.) to the acquisition resulted in a massive drop in IT service levels. The acquisition had extended the IT service footprint by roughly 30%, the impact of which was not anticipated.
• The acquisition lost key people, and poor IT integration contributed – it was called out specifically as a cause of low morale/high turnover post-acquisition.
• The cost of integrating IT systems and services was 4x the anticipated cost, and took over a year longer to achieve than originally planned.

That’s the horror story of what can happen when IT readiness isn’t understood. But imagine another, much more proactive scenario:

Your company’s M&A planning generates a few likely integration scenarios prior to executing the merger. An IT and systems readiness assessment is performed against those scenarios, looking at (among other things):

• Business process readiness – there needs to be a high degree of understanding of core business processes, both within the business and within IT. IT is paralyzed without requirements, and business processes are where they come from. If subject matter experts in those processes are unavailable or missing, integrating systems or migrating new people to current systems will be challenged.
• Architecture and systems readiness – is the enterprise architecture outdated? How does it mesh with likely acquisition targets? Are current applications and infrastructure healthy and stable? What interface options are there, and is IT currently staffed to handle their development and future maintenance? If not, what contract/partner options are there to farm out that work, and at what cost? Answers to these questions may lead to a portfolio of “get-healthy” infrastructure and applications work.
• Service delivery readiness – depending on the post M&A integration scenario, IT may be called upon to extend services to a significant number of additional workers. Is support staffing adequate or will it need to be shored up? What is likely to happen to acquisition staff? Will they join the IT team, and if so is IT ready to onboard them? Answers to these questions may lead to changes to the IT organization and/or improvement projects to make better use of current staff.
• Vendor contracts and commitments – are there potential impacts to these as a result of a merger?

Gaps highlighted in the assessments lead to narrowing of integration options to those which are most cost effective and likely to succeed in required timeframes. Projects to achieve readiness are planned and executed in time for the merger to occur, setting up the post-merger integration activity for success.

Which path is your business headed down? We can help. Perficient offers effective and experienced M&A management consulting, backed by proven technology strategy and implementation services which you can use to ensure post-merger integration is successful.

[1] Deloitte, The State of The Deal, M&A Trends 2018