Improving electrical distribution reliability and costWritten by Jose Sanchez
ackground The company analyzed it's competitive position relative to other large investor owned utilities in US. It became clear to survive in a deregulated environment that significant change was needed in 3 key areas. Reduce operating and maintenance expenditures to be at or near best companies in cost per kWh. Improve generating efficiencies and implement load control programs so that no new generating plants would be needed to meet forecasted demand through end of century. Maintain overall system reliability, and focus on improving reliability for largest commercial and industrial "at risk"customers, and fund this effort by redeploying cost reductions. Develop a sense of competition on its people Developing Customer requirements An effort was undertaken to obtain reliability expectations of all customer segments. Of primary concern were large commercial/industrial (C/I) customers. This effort yielded a clear picture of customer expectations and recognition that significant improvement was necessary for a portion of large C/I customers if company was to retain them in a deregulated environment. Other pertinent information was collected during this phase that would provide basis for new product and service offerings geared to customers who required "premium power quality".
Systematic process improvement The existing methodologies were not dynamic enough to focus resources on most significant problems and target specific customer segments. Past improvement efforts were directed at system-wide projects that resulted in slight reliability gains. A more focused approach was needed in this new environment of cost reduction. This process assessed relative revenue contribution to company margins of specific customers, and current level of reliability they were experiencing. In addition, their individual expectations, or reliability thresholds which were obtained in surveys, were used in developing a scoring index. All large commercial customers were evaluated in this way. This resulted in a ranked scoring, or prioritized list of all C/I customers and enable company to focus improvement efforts.
Implementing reliability improvements After C/I customers were ranked in order of needed improvement, a field analysis was conducted at feeder level for each high priority account to identify needed corrective actions. This analysis resulted in a number of system improvements that were scheduled as part of operation and maintenance work to be completed. A deployment strategy was developed based on sound PDCA principals. These projects were included in budget allocation process and were integrated as priorities in local business plans. Total expenditures in improvements were tracked to assess benefit of investment These projects were worked before heavy outage season and early enough in year to see reliability improvement gains by year end.
Guide for Visionary Leaders and Business Decision-makers. Written by Bob Cannon
Change and Cycle of Specialization Robert E. Cannon www.cannonadvantage.com
Guide for Visionary Leaders and Business Decision-makers. – In January issue of Taking Aim, I reported on book Margin. That book triggered some thoughts that had been floating in and out of my consciousness for some time. In fact I had even created topic “Cycle of Specialization” several years ago, but just couldn’t quite get my thoughts to gel in any cohesive manner. This then is an attempt to put into words those thoughts and how it affects us as visionary leaders and business decision-makers. There is a Cycle of Specialization that has repeated itself over centuries. It has been difficult to spot because cycles have frequently been far apart, but pace is quickening. Our society is being driven to a more rapid rate of change in cycle by growth in population, technology and information. The cycle begins with prehistoric man and his work to survive. He had to be a vertical supplier to his own survival. He was responsible for his own food, shelter, water, and protection. He was dependent upon himself for his own survival. As time went on, he invented language and traveled in groups or tribes. These groups started to specialize. Some would hunt while others would drive game to hunters or cook food and as that happened; each specialization became vertical in their specialty. The hunter prepared his own equipment for hunting and cooks developed their own tools for cooking. Things changed very little for thousands of years. Certainly villages changed and farming became a specialty and each farmer in turn became vertical in his specialty and developed his own tools. With advent of farming came permanent establishment of villages and a new range of specialties developed. Craftsmen developed who specialized in spinning wool, weaving cloth, making clothes, making shoes etc. Each craftsman again had to be a vertical supplier of tools and technology to his own craft. This knowledge was passed along via apprenticeships and cycle continued. Today, as was pointed out in Margin, we are undergoing exponential change and with that, we are also undergoing exponential specialization. As a researcher, it is easy for me to point to work government has undertaken to modernize old Standard Industrial Classification (S.I.C.) codes to cover new products and services that were not in existence when codes were created. Another great example comes to mind having just gone through traditional year-end review of news. 2004 was for many year of blogger. Ten years ago Internet was still in its infancy, there was no E-Commerce let alone bloggers. (My spell checker still doesn’t recognize word blogger.) Another area of incredible specialization is Health Care. It wasn’t that many years ago that if I didn’t feel well, I went to my doctor and he prescribed something to help me. Today my family doctor is nothing more than a gatekeeper. When I don’t feel well now, I go to see him to find out whom to see to treat my problem. Our efforts to improve our competitiveness with LEAN and Continuous Improvement are so internally focused that we are creating even more specialists to delve into minutia of processes at a level previously unthinkable.
Specialization creates information, which requires more specialization creating an unending Cycle of Specialization devoted to continuous improvement of product or service. (I am not certain which came first, specialization or information, but cycle continues.)