Enterprise architecture is the key to business transformation for the energy and utilities industry. Read the latest in our series of articles exploring the power of SAP LeanIX across a range of industries.
Enterprise architecture is a key capability for the utilities industry to leverage in order to unlock business transformation. EA is a methodology for synergizing your operations with your IT landscape and digital capabilities, and this is increasingly crucial for energy providers being called on to meet rising need under financial duress, as well as reduce their carbon footprint.
Enterprise architecture can show organizations what software applications and IT components they're using, whether they're best-of-breed, and what business capabilities they support. Armed with this information, energy suppliers can plan a road map to take them from inefficiency to optimization.
SAP LeanIX is the digital toolset for enterprise architects, both experienced and just starting out. To unlock business transformation, energy suppliers need the power of LeanIX.
In the next part of our series exploring how enterprise architecture drives business transformation across different industries, let's consider the factors impacting utilities. Discover how enterprise architecture drives transformation for energy suppliers.
Enterprise architecture is key for supporting the utilities industry through business transformation to meet customer and regulatory needs. To find out how to empower your EA function, download our success kit:
Success Kit: EA for Energy & Utilities
The World Needs More Energy
Enterprise architecture is vital for a utilities industry under increasing pressure to expand its capacity. The world's population is continuing to grow and its thirst for energy is rising even faster.
The World Economic Forum reports that the global demand for electricity is due to rise by 4% in 2024, increasing even faster than the 2.5% it grew in 2023. The world is calling on the utilities industry to expand its capacity to provide for that growing need, both now and into the future.
This is particularly important now that the world is looking forward to a future powered by artificial intelligence (AI). The power needed to enable AI data centers is immense, and so is the demand for these services.
Yet, energy provision networks in place across the world weren't designed to fill that capacity, or to be rapidly expanded and improved. The energy industry needs to upscale its capacity at an exponential rate and also to upgrade its software to manage that level of provision.
This means that utilities companies are facing a desperate need to transform their organizations rapidly, while also dealing with a restrictive economic environment. The world is still paying off debts incurred during the pandemic and this means that few governments or customers have the money to invest into expanding their energy networks.
All this leaves the utilities industry under pressure to literally do more with less. Not to mention, methods of energy production are also under scrutiny.
Regulatory And ESG Pressures
Enterprise architecture can help the utilities industry overcome pressure to help combat climate change and meet environmental, social, and governance (ESG) issues. Regulators, customers, and our own best interests all call on energy providers to find renewable energy sources before traditional fossil fuels run out.
The world is currently 1.2 degrees celsius warmer than it was in the 1800s. To keep this global warming under 1.5 degrees, 195 nations agreed to the historic Paris Agreement, which pledges to reduce carbon emissions to net zero by 2050.
Filling this demand means utilities providers must find alternative energy sources that not only conserve fossil fuel reserves, but are also carbon neutral. The ability to track this use is just as crucial as actual success for both reducing carbon and satisfying regulators.
New reporting tools and methodologies, such as T-EACs, are increasingly expected by regulators. Implementing new energy provision infrastructure, new reporting tools, and adapting the way you provide to customers requires, not just technological change, but also changing your marketing messaging, retraining your teams, and operational flexibility that could require restructuring.
Any changes to your supply chain will require comprehensive and wide-reaching adaptation for your organization, and it won't be for the last time. Transforming your business is a daunting task, but it is precisely what enterprise architecture can unlock for you.
Business Transformation Is Key For Utilities
Enterprise architecture can unlock business transformation for the utilities industry. What exactly do we mean by business transformation, however?
Once, we would discuss "digital transformation", but enterprise quickly found that 70% of digital transformations failed. This was because true change requires a more-holistic approach.
For transformation success, you need to optimize your operational processes in synergy with your upgrade to your digital systems, ensuring both will operate as one and support each other. Comprehensive whole-business transformations are the only way you can adapt your business to thrive in the modern market.
For the utilities industry to adapt to rapid growth, modernization, and environmental, social, and governance (ESG) regulation, it must look to change across its people, processes, applications, and data in synergy. To do that, you need to have detailed oversight of your entire IT landscape and how it impacts and relates to the rest of your business.
With this clarity on your digital operations, you can see how your IT interacts with your real-world processes in order to plan changes to your software and understand the impact on the rest of your business. For the utilities industry, this means keeping track of new monitoring software and the new technology being used to increase energy production, and understanding how it benefits your customers and staff.
That's why SAP LeanIX is the perfect tool to retain a single source of truth on your IT landscape and its dependencies. Let's explore the power of SAP LeanIX.
SAP LeanIX For Utilities Transformation
SAP LeanIX is to enterprise architecture what Zoom was to team meetings. Our solutions not only bring digital EA to the utilities industry, but our automations and built-in guidance empower any organization to set up an effective enterprise architecture function.
Each software application and IT component in your landscape will have its own, customizable fact sheet. These can be filled in manually, or with imported information from your configuration management database (CMDB), a variety of other sources, or automated user surveys.
The fact sheets can then be organized and connected according to your business capability map, showing you which applications support which crucial services for providing energy to your customers. With the fact sheets set up, you can perform advanced analytics and visualizations on them to prepare you to chart a course for change.
Plan that course directly in SAP LeanIX' sandbox environment, mapping your entire transformation based on real, live data. This plan can then be shared with anyone in your organization to win stakeholder engagement.
SAP LeanIX has everything you need to drive your organization through transformation to growth and success. From there, you'll be ready for every future business transformation, regardless of how the market calls on you to change.
Enterprise architecture is key for supporting the utilities industry through business transformation to meet customer and regulatory needs. To find out how to empower your EA function, download our success kit:
