Implementing arm systems? – Don’t forget the process changes

Implementing arm systems? – Don’t forget the process changes

Robert L. Trotter
Executive Consultant
Spirit Business Solutions, LLC
356 West Ash Avenue
Decatur, IL 62526-1708
Telephone (217) 877-3759
Email: trotterr@msn.com

Abstract
To survive and prosper in the new paradigm of competition, distribution utilities are required to consider the impact of process changes, new organization structures, and new technologies to achieve operational excellence. Some utilities are becoming companies that deliver energy to customers who have contracted for energy from other suppliers. Many are in the process of installing new Asset and Resource Management Systems (ARM) and integrating them with existing legacy systems. While some of us feel process reengineered to death, the processes must be reviewed enough to ensure that the new systems and the integrated legacy systems support the processes required to do business. The processes should also be reviewed throughout the implementation to obtain the full benefit from the implementation. While integrated systems improve the utility’s ability to deliver power, even greater improvement can be realized if they properly support the asset and resource management processes. A properly integrated solution will reduce paper work, improve the delivery cycle, reduce the overall cost of power delivery, and provide better decision making related to power delivery. This paper identifies the benefits to be gained by reviewing the processes at the outset and during implementation so that integration of an ARM solution can deliver expected results.

Introduction
To survive and prosper in the new paradigm of competition, distribution utilities are required to consider the impact of process changes, new organization structures, and new technologies to achieve operational excellence.

Some utilities are becoming companies that deliver energy to customers who have contracted for energy from other suppliers. Many are in the process of installing new Asset and Resource Management Systems (ARM) and integrating them with existing legacy systems.

The primary system component parts of an integrated asset and resource management system are:

Outage Management System (OMS)
Customer Information System (CIS)
Mobile Dispatch System
Geographic Information System (GIS)
Work Management System (WMS)
System Control and Data Acquisition System (SCADA)
And often Mobile Computing

While some of us feel process reengineered to death, the processes must be reviewed enough to ensure that the new systems and the integrated legacy systems support the processes required to do business. The processes should also be reviewed after selecting a vendor, during implementation, and after implementation is complete to obtain the full benefit from the implementation.

While integrated systems improve the utility’s ability to deliver power, even greater improvement can be realized if they properly support the asset and resource management processes. An integrated solution will reduce paper work, improve the delivery cycle, reduce the overall cost of power delivery, and provide better decision making related to power delivery. This paper explores the benefits to be gained by reviewing the processes at various points of implementation.

Five process reviews will be discussed:

Justification for a project
Process review when producing a request for proposal Process validation review during implementation
Follow-up process review after one year
Decision making processes

Description of arm systems
ARM systems are usually comprised of the following systems: Outage Management, Geographic Information, Customer Information, Work Management, Mobile Dispatch, Mobile Computing and SCADA. Customer Information is not usually considered part of ARM, however, it does contribute to the information needed to operate the electric system. Figure 1 shows how information may flow from one system to another. The messages shown in this example are for an outage scenario.

Figure 1 – Typical ARM
Outage Management System (OMS)
The Outage Management System analyzes the outages as they are entered into the system and helps to determine the probable location of the cause of the outage. The system depends on a connectivity model and follows a set of business rules to determine the location or cause of the fault. It tracks the calls received from customers, groups the calls, and forms an incident. The business rules decide when a group of outages are gathered into a single incident and are considered as the probable cause of the outage.

Geographic Information System (GIS)
The Geographic Information System is the normal location for storing the base connectivity model of the electrical system. This base connectivity model is copied to the Outage Management System regularly or when significant change has been made to the model.

Maintaining the design model of the system in one location, the GIS, increases the model’s accuracy and eliminates nearly all the time required to transfer the connective information to the OMS. In many cases, integrating with a GIS can eliminate the need for two or more full time clerical people.

Customer Information System (CIS)
In most companies, individual customer information is stored in the Customer Information System. The information includes location, type of customer, and some information about the circuit that the customer is attached to. The CIS also contains business information about the customer. It is the primary tool of the call center and can be used to record outage calls. The outage calls are then sent to the OMS.

Work Management System (WMS)
A modern Work Management System manages virtually all the work the utility does. Within the Asset Management framework it is focused on supporting construction work, maintenance work orders, service work, outage work, etc. The WMS is often a large, enterprise system that interfaces and/or integrates with most of the major existing distribution systems. The Work Management System becomes responsible for managing effectively and consistently all the work that the Distribution Company performs. In the case of restoring power to customers in an outage situation, experience has shown that it is better to restore the outage and use the WMS as a reporting tool to track the costs and time.

Mobile Dispatch System (MDS)
The Mobile Dispatch System is used to route and dispatch the crews to work locations. These systems evaluate the current location of the crew and the best route to get to the new work location. They also take into consideration the current work assigned, the priority of the work and the capability of the crew.

Mobile Computing
Mobile Computing brings to the field the asset management data and records the results of the inspection or maintenance activity. The field is where the work is done and automating the field user eliminates the need for paper records and clerks to transcribe the paper records. It increases the accuracy of the data since the user enters the data as the work is being done. It also provides the associated data such as map directions and optimized routes, schematics, substation diagrams etc. Mobile Computing also provides for very timely reporting of work in the field, thus keeping information more current and accurate. Some of the systems can be used to reduce the amount of voice communications thus leaving it available for the most important needs.

System Control and Data Acquisition Systems
SCADA Systems are used to control the distribution and transmission system. The SCADA system acquires data about the system operation and supplies it to the system operators. It allows the system operator to make decisions about switching and controlling the load on the system and perform remote switching of electrical system components. In an outage situation, information can be supplied to the OMS and used to help analyze outages and their probable cause. If this system is integrated with the Outage Management System, it can be vital in helping to analyze the cause and location of an outage.

Justification for a project
Often a process review, such as reengineering, helps a company decide to implement tools that support the ARM processes. What this means is that an area sees the need to improve and begins the effort to get approval to buy and implement software. The decision to implement ARM software to support the ARM processes is usually done in one of two ways.

A top down look at the entire ARM processes
A bottom-up approach

The top down approach has a big advantage. It helps to define the overall goals of the processes and identify the best order to use when installing the various new processes and systems. This approach also helps senior management to understand what is needed and to be supportive of the changes that will be implemented.

The bottom-up method will often give great improvement, but it may not give the greatest benefit for the dollars spent. With the bottom-up method, the need for improvement is seen for a specific function which begins the effort to get approval to buy and implement software. This approach often has some short comings. When systems are installed one at a time without the benefit of an overall plan, the benefits of systems installed later may be compromised. In addition, the system being installed may not bring as many benefits as installing software components in a different order might accomplish.

It is very important before starting any implementation, to set specific goals and expectations for the new processes and systems that are to be implemented. This will help those implementing to understand what is expected and will provide for later review of the project accomplishment. Changes, such as these implementations, need strong support from senior management. It is often the case that senior management says they support the changes, but in fact they seem to have a hands off approach. It is very important that employees in the organization see senior management involved.

The ARM system user must be a part of the process and must provide strong support and buy in to this new way of doing business. Before installing an ARM system, companies should start with an examination of existing systems, procedures and paperwork. Users should examine the major functions: interfacing with customers, writing work orders, designing projects, scheduling work, procuring material, construction management, maintenance management, etc. They must then decide how best to operate. A team should look at all of the company’s areas and see how they work; chances are the areas operate differently. Find the best practice and adopt it for the entire company, then review it for further improvements.

Process review when producing

A request for proposal
As the project team reviews the various vendors’ software to be used in the bid proposal, it is a good idea to think about small process changes that may help to make the software selection easier. It will be unusual to find a software system that will work without changing the processes to some degree. In most cases, software customization will be required if a company stands fast that they will not change processes.

The project team should consider the following issues as they begin the process of selecting a software vendor:

Confirm the vision & strategy
Get the education needed to be qualified to make the decisions required
Assess the “As-Is” model
Frame the “To-Be model
Identify the critical road-map for delivery of the conceptualized solution model

Include the end user when selecting software and with the process changes from the early stages of the project. This will make small process changes easier and may also provide a better understanding of the software when analyzing the bids. One advantage of changing process rather than customizing the software is that support for the new system and future upgrades of software are much easier and less expensive.

Process validation review during implementation
Some flexibility during the implementation is very important. In cases where the utility company has been willing to make small changes during the bidding process, they should expect other differences to be found during the implementation process. If the software is purchased and the utility company is too rigid about changing processes, the result may be a large amount of customization, which will lead to costly changes to the software during implementation and increased cost of maintenance of the system in the future. This review during implementation is sometimes called process validation. It validates the user company’s processes against the functionality of the vendor’s software.

The objectives of process validation are to determine and understand the company’s existing ARM processes in detail, recommend changes to the processes to correspond to existing system capability, and demonstrate the use of the ARM system. Interface requirements from the Customer Information system, Payroll system, General Ledger, and Materials Management system to/from the ARM system component will also be further identified at this time. To assist the company and other teams in understanding the ARM system and contributing to the process validation, a detailed walkthrough of ARM system should be conducted as part of the process validation effort. The walkthrough also serves as valuable initial project team training on ARM system operation and use.

Following the ARM system walkthrough, the vendor should conduct a module-by-module review of the processes in conjunction with the ARM workflow. During this review, interface points should be identified and business process changes defined. Requirements are then defined for the changes in functionality, and for the interfaces with systems such as CIS, Payroll, Materials Management, and General Ledger. All such requirements should be documented in a Requirements Specifications document. At this point, the utility company should review the changes needed and decide if it is better to change processes than to change the software.

Follow-up process review after one year
At the end of the first year, it is very important to review the results of the implementation and take stock of whether the original goals have been met. This is the time when having the expectations identified in the beginning is of great value, since the review should be based on those criteria.

It is good to complete a follow-up process review about a year after implementation is complete to see if the initial benefits have been accomplished and see if further benefits could be realized. Some of the things that can be expected from doing this are:

Evaluate if original goals are met
Look for further improvements by changing the processes
Identify future enhancements

Consider the decision making processes
One other way to improve the ARM processes is to look at how decisions relating to the various processes are made. Many times, we set up processes for the workflow, but fail to consider the information needed to make good, timely decisions around those processes. When looking into the decision making process, sometimes we may find that we are giving the decision makers the wrong information or they are receiving too much information to process. As an example, in the outage management process, companies usually move through steps as the number of outages increases. Typically these steps are local, regional, and company wide. The decision to move from one category to another requires a considerable amount of information. It is important to have a process in place that will assist in making the decisions.

People tend to make decisions that they feel are on the safe side. Sometimes these decisions are very costly since a decision to bring in outside help to recover from a large outage is very expensive. The timing of the decision is very important and developing a process for making the decision often can help decide when to bring in outside help, how much help will be needed, and when to let them go as the recovery progresses. While most utilities have a process in place for large outages caused by storms or other events, they do not have a process in place for making critical decisions as the outage and restoration progresses. Improving the decision process can help to insure timely, accurate information for making the decisions necessary to use the processes.

Change management
Change Management is an important part of process reviews. When looking at process changes, make sure to address the scope of change being recommended and the amount of change that the organization can absorb in each step of the change. While it is important to have the ultimate process in mind when doing process review, it is necessary to reach that ultimate process in steps that the organization can successfully implement. If the steps are too big and the implementation isn’t successful, you may have to go back and it is very hard to pick it up in the future. One of the issues in going to a step that can’t be successfully implemented is that the organization develops doubt in management’s ability to make the changes happen. This also gives the skeptics ammunition since they didn’t think the changes would work anyway. What this is saying in different words is that the change management considerations are important and must be considered in any process change evaluation.

Summary and conclusions
It is advisable to look at the process review of ARM processes as a four step process. These steps are:

Before starting the justification for a project – a top down approach is usually best
Specific process review when producing a request for proposal – processes that are more in line with what vendors have will expedite the implementation
Process validation review during implementation – the processes that are to be used must line up with the system capabilities and processes
Follow-up review about a year after implementation is complete to check if benefits are accomplished and see if further benefits could be realized.

There may also be benefits in looking at the decision making process that sits on top of the functional processes. This provides a look at the information that the decision makers need in following the processes and helps to eliminate the information that doesn’t help them with making good and timely decisions.

Change management should also be considered in process reviews since it is often the key element to making successful process changes.