Operational improvement and performance management
Utilities are increasingly squeezed between demands for better quality and improved customer responsiveness and a drive to continually reduce operational costs. These changes are being driven by regulators, shareholders and customers, and require new ways of working, and more flexibility in how and where services are provided. Yet typically, all of this must be delivered without compromising safety and compliance requirements.
PwC brings a team that not only understands operations, but also the unique aspects of the power and utilities sector. We collaboratively work with you to align your people, processes, technology and organizational structure so that you can most readily achieve your desired outcomes and incorporate the needs of your stakeholders.
Our team can help you across a wide spectrum of activities, including:
- Operations Transformation: Transforming the front and back office to support strategic objectives
- Core Operations: Increasing value by improving day-to-day activities in operations and capital projects
- People and Change: Achieving value through your people
- Customers and Markets: Leveraging customer insight and social media to drive innovation
Across these activities, we recognize the importance of performance management — whether it be to benchmark your current operations or to measure your progress in implementing new initiatives over time. We leverage global best practices and industry insights to assist you in identifying and implementing the tools and processes needed for continual improvement.
Transforming supply chain and material logistics
Cost reduction and operational efficiency are key issues for utility industry leaders, and have the potential to drive significant value for stakeholders and shareholders. We believe that the supply chain strategy for leading utilities goes beyond simply making tactical procurement more efficient. Leaders are focusing on leveraging business partner alignment and supply chain collaboration to bolster productivity and reliability.
PwC can advise you on industry practices to transform your supply chain and achieve cost reductions across your operations, such as:
- Designing and executing corporate and operational cost reduction programs
- Value/cost driver modelling and continuous improvement process design
- Measuring supply chain performance and business unit expectations
- Helping to create a metrics-driven, high performance culture
- Establishing monthly cost review and cost reporting processes
Enterprise Asset Management (EAM)
In today’s market, asset-intensive utility companies are facing numerous challenges including aging installed assets, unstable credit conditions, nervous stakeholders, and volatile input costs. To succeed, you need your assets to perform like never before. You need to increase your uptime, output and asset reliability while decreasing maintenance costs and extending asset longevity.
This requires a proactive and comprehensive approach to Enterprise Asset Management (EAM). Our EAM team is highly regarded in the utilities sector for our skills across the asset lifecycle, from concept and design, through procurement/construction to operations and decommissioning. We provide independent advice and assistance to develop and implement an integrated asset management strategy that will improve your EAM efficiency (leading to improved execution) and EAM effectiveness (leading to increased reliability and availability). Specifically, we can assist with:
- Increasing reliability and asset performance to its intended levels
- Developing decision analytics around asset life cycles
- Integrating with inventory management solutions
- Managing the asset through its life cycle
- Creating maintenance standards and policies
- Optimizing preventative and predictive maintenance programs
- Improving your maintenance labour utilization
- Developing a performance measurement program
- Selecting EAM software
- Providing EAM software implementation or optimization
Investing capital effectively is crucial for a utility's short and long term success. Utility asset lives can span 25 to 100 years of useful life. Consequently, ensuring your capital asset portfolio is optimized is critical, including ensuring the right asset is built in the right way for the right cost. As Canada's electric, gas and water assets age, critical pieces of infrastructure are coming to end of life, creating a demand wave of capital project investment that is historic in its height and breadth. Many organizations are facing increased capital spending just as key members of their management team are retiring, increasing the need for strict project oversight and proactive management.
PwC is well positioned to help utilities find the right balance in capital projects management and focus on the key elements affecting program performance, including:
- Building greater levels of flexibility into project execution, such as building options and flexibility into contractual terms with suppliers, so programs can easily be slowed or accelerated depending on market developments
- Updating capital program governance frameworks, including reporting practices, to reflect new industry realities
- Managing the demand for capital, for instance, finding new sources of financing by increasing links with joint venture partners or customers
- Ensuring an appropriate role of key stakeholders, including boards, internal audit and, where appropriate, external stakeholders such as regulators, engineering/construction firms and first nations peoples.
For more information, read our publication Gain not pain: Managing risk in utilities capital projects.
Utility companies face ongoing regulatory compliance requirements and increased public scrutiny to integrate sustainability into their overall strategies.
PwC's Sustainable Business Solutions team works with utilities to align corporate governance and non-financial management, including operating systems and processes, performance reports and mechanisms, to meet the needs and expectations of stakeholders. Examples of our solutions include:
- Sustainability strategy development
- Stakeholder engagement
- Certification (ISO 14001, 9001)
- Environmental liability audits and due diligence engagements
- Corporate social responsibility reporting
- Non-financial report assurance
With so many moving parts within utilities operations, it's important that risk management, internal controls and governance processes accomplish business objectives and meet stakeholder expectations.
We can help you develop internal audit and risk management plans and methodologies to increase the effectiveness of your internal audit processes. We also offer resource solutions depending on your needs, including outsourcing and complementing in-house functions.
Finance function effectiveness
Today's business environment is putting pressure on finance departments to deliver superior information and controls in line with increased governance and transparency. There is also a demand to reduce operational costs.
Utilities face these issues in spades as increasing regulatory scrutiny puts additional pressure on the finance function’s transactional support, analytical throughput and strategic role.
PwC professionals can help you assess, design and implement changes to your financial processes and systems. Our services include:
- Strategic planning for your finance function
- Business process standardization and simplification
- Improved consolidation process and management reporting
- Improved budgeting and forecasting processes related to both operations and capital
- Selecting and optimizing enabling tools and technologies
- Identifying cost reduction opportunities