By Greg Galluzzi, Senior Vice President, Five Point Partners |
May 2009
People are always curious about what is taking place in the CIS
marketplace. It is not easy tracking all of the different initiatives.
While one utility market segment may be extremely busy with CIS
projects, others may have minimal activity. This article attempts
to provide you with insight into what the market is experiencing
in terms of CIS projects and in particular CIS installation efforts.
What we do know about CIS initiatives within the North American
utility industry is that of the utilities who are engaged in a CIS
project:
In addition, when examining 25 utilities who have installed a new
CIS solution in the past five years we discover the following:
Utilities engaged in a CIS installation effort find that it is
imperative to closely manage these risky projects. The following
are aspects of the CIS project which these 25 utilities constantly
monitored in order to insure the success of their initiative.
Customer and Vendor Expectations. Although
formal contract documents were developed, signed, and agreed to
by both parties, several details arose during the implementation
which became the source for conflict and disagreement. The utility
focused on resolving these conflicts and maintained realistic
expectations regarding the delivery and timing of all aspects
of the CIS solution.
Project Resources. One of the biggest headaches
was staffing the project with experienced vendor personnel and
talented utility staff. Most of the utilities had to release their
most experienced personnel to work on the project while still
conducting business and maintaining high levels of customer service.
Project Scope. As detailed design activities
progressed additional CIS components were included or excluded
from project scope. The utilities worked to minimize the number
of project scope changes, identified out-of-scope items, and they
followed a structured project change request process.
Project Cost. The utilities closely monitored
project budget, actual expenditures in the current period, actual
expenditures for the project, estimates to complete for the project,
and actual cost projections in comparison to project budgets.
In addition, they reviewed dollars associated with any project
change requests to determine fairness and impact to the project.
Project Schedule. The utilities closely monitored
project activities and their progress in relation to the project
baseline. For each primary activity this included; the tracking
of percentage complete and the projected end date; the status
of project milestones with the identification of pending, past
due, and critical path milestones; and, the status of financial
milestones.
Project Risk. During the course of the project
several issues arose, some of which had the potential to impact
the successful CIS implementation. The utilities identified areas
of risk which may have impacted the project timeframe, project
budget, system functionality, or other project components as identified.
Contract Terms & Conditions. The utilities
monitored vendor(s) performance in relation to contracted terms
and conditions and the agreed upon statement of work. Any discrepancies
were identified and reported for subsequent resolution.
The following are common issues faced by utilities who are implementing
a new CIS. If not properly addressed these individual issues may
ultimately impact the ability to successfully implement the CIS
solution.
Mobilization and Staffing. Some projects found
their vendor was slow to mobilize and staff the project. In addition,
a few of the people proposed and identified in the Statement of
Work were not the ones who showed up for work – instead
they tended to be less qualified and experienced.
Retaining Key Project Resources. Key resources
assigned to the project were not always staffed for the duration
of the project because vendors who staff multiple projects tend
to move their resources around. For example, one project lost
five key vendor personnel to other projects.
Staffing the Project with Utility Personnel. Operationally,
many utilities are currently faced with low production staffing
levels, hiring freezes, and a reduction in overtime pay. As a
result many utilities faced resource issues regarding serving
the customer and staffing the project. In several instances, they
failed to backfill positions allowing critical resources to staff
the project. These critical personnel found themselves doing their
regular job and trying to work on the project full-time.
Utility Resource Utilization. Many times the
work program and associated schedule did not take into consideration
the utility’s ability to staff the project and complete
the work assignments in a timely fashion. Project management must
conduct resource loading and leveling activities to insure the
work assignments and timeframes are realistic.
Project Team Socialization and Collaboration. Typically
numerous individuals from many different companies participated
in the project. The impact on the project was a complex organization
structure and staffing with many roles and responsibilities –
some of which overlapped. It is imperative to introduce people
to the project and to insure each person understands their specific
roles and responsibilities.
A Comprehensive Work Program. Most projects
were managed with limited work programs. Project work programs
need to contain project activities, project milestones, and dependencies.
It should be used with a rescheduling feature to identify impacts
to the project critical path and movement of project milestones
including the project go-live date.
Lack of Work Direction. Utilities typically
looked to the vendor for work direction and assistance in completing
project assignments. However, in some instances the vendor focused
only on their work assignments and left the utility to their own
devices. Vendors must lead utilities through the process to insure
both the system and the business are ready for production.
Operating Platform Late Decision. In some cases
the decision on which platform to use was left to be determined
during the installation phase. As several options exist regarding
operation of the CIS including: in-house, hosted, and outsourced
platforms, vendors and utilities found themselves scrambling to
define, design, and implement the hardware infrastructure to support
development activities.
Slow Bill Redesign Activities. Next to conversion,
the leading cause of missed go-live dates was the bill print not
being ready. Successful utilities started their bill redesigned
process early in the installation phase in order to be ready for
go-live.
Slow Scope Confirmation Process. In cases where
a clearly defined scope was not in place, the project spent considerable
time on confirmation and design activities leading to a defined
scope. This left less time for subsequent development, testing,
acceptance, and go-live preparation activities.
Excessive Third Party Interfaces. Frequently
overlooked was the complexity and time requirement to develop
third party CIS interfaces. For example, a bank may require 180
days to test remittance processing for the new scan line. This
work effort must be considered and built into the project timeline.
Identification and Development of Reports. When
the identification of new reports to be developed was done late
in the installation process the utility found itself struggling
to finish report development by the go-live date. In these cases,
many reports had to be developed and implemented in a post go-live
period.
Installation of the CIS Data Warehouse. One
of the biggest selling points of a new CIS is the capabilities
demonstrated around the new CIS data warehouse. Unfortunately,
most of the projects did not adequately allow sufficient time
to train on the tool and develop specific use of the warehouse
by the utility. Much to the dismay of everyone, this work is typically
pushed to after go-live.
Project Behind Schedule. At one time or another,
many projects fall behind schedule. Usually, once a project falls
behind schedule it is tough to catch up. It is imperative that
the utility focuses on monitoring the schedule and working as
efficiently as possible to stay on schedule.
New Go-Live Date. If the project fell behind
schedule, the utility assessed impact to the go-live date. Many
decided to retain the existing go-live date until a new date could
be determined. At that time a formal decision was made to change
the go-live date. The utility’s objective was to change
the go-live date only once.
Knowledge Transfer. One of the greatest fears
of a utility has been that when the vendor leaves there will be
no one left at the utility with knowledge of the system. Yet surprisingly,
only a few utilities had formal knowledge transfer programs put
in place as a specific activity in the work program.
Access to Historical Information. Strategy regarding
how the utility will access information not converted into the
new CIS was often poorly planned for. Questions like: “Will
the existing billing system remain accessible, and for how long?”
“Will there be another secondary system used?” “How
does the purge/archive process work in the new CIS and how will
the utility access that information?” were not addressed.
Late Code Drops – Poor Code Quality. Unfortunately,
utilities have experienced late code drops from their vendor or
code that when tested was found to be of poor quality. This impacted
development activities which many times infringe on the start
of testing activities.
Conversion Is Tough. Conversion was usually
a lengthy and complicated process. Often there were multiple sources
of data which had to be converted. In addition, in some cases
the utility did not have people who are knowledgeable about the
existing data, and on the other side, the vendor did not assign
personnel with in-depth knowledge of the new CIS.
Insufficient Testing Time. It is a notorious
fact that no matter how well a project is planned, if design and
development activities take longer than expected, testing time
is shortened to compensate. In these cases, testing was not as
thorough and often multiple tests were executed at the same time,
e.g. system testing, integration testing, performance testing,
and user acceptance testing.
We know that 50% of utilities engaged in a CIS project are involved
with an implementation effort. These utilities are constantly monitoring
their projects and addressing project issues as they arise. While
there are many challenges a utility may experience on a CIS project,
one thing is certain, over time we find utilities are having greater
success with their CIS installations than they have in previous
years. All parties can and must work together toward a common goal
of a successful CIS installation.
