executive summary: high-performing information systems aligned

Portions of the IT Strategic Plan will also provide necessary elements of the Enterprise Architecture (described above).

Figure S.4 Critical Inputs and Outputs into the Strategic IT Planning Process

Strategic IT planning is often undertaken in utilities every 3 to 5 years. However,

a more continuous process is needed to sustain the defined initiatives and adapt to changing business needs. Strategic IT planning occurs in the context of IT Governance. IT Governance includes both an organizational structure, such as an IT Steering Committee, and a process for receiving, evaluating, and making decisions on high level IT issues and solutions.

One purpose of IT Governance is to make sure the major decisions about IT involve the correct decision-makers. Accordingly, as shown in Table S.1, a Decision Rights Matrix is used to develop a clear understanding of the types of decisions to be made, and the roles of individuals or groups involved in the process. Once the Decision Rights Matrix is finalized, the IT Governance organization and processes are designed to support the decisions.

Where are you today?• Strengths• Weaknesses • Opportunities• Threats/Obstacles

Where are you going?• Vision• Mission• Goals• Objectives

How will you get there?• Strategies• Tactics• Success Factors• Best Practices

How will you know you have arrived?

• Performance Measures• Reporting• Accountability• Action Plans

IT Strategic Planning Process

IT Priorities in Utility Context

• Aligned IT Strategies• IT Project Priorities• IT Program Framework

Resource Requirements• Business Case• IT Program Budget• Organization• Roles and Responsibilities

Program Plan• Prerequisites• Schedule• Dependencies• Risks

Commitment to Change• Executive Advocacy• Stakeholder Input• Cross‐departmental relationships• Governance Framework

Critical Inputs into Planning Process

Critical Outputs from Planning Process

©2013 Water Research Foundation. ALL RIGHTS RESERVED.

Table S.1 Typical Utility Decision Rights Matrix

Role IT

Principles IT

Standards IT Support Procedures

IT Annual

Plan and Budget

IT Capital Investment

General Manager

Provides Input

Approves Approves*

Department Senior Manager

Provides Input

Provides Input

IT Steering Committee

Approves Provides

Input Provides

Input Approves

Provides Input

IT Leader Develops Develops

and Approves

Develops and Approves

Develops Recommends

and Approves*

Capital Procurements

Committee Approves*

*Investment approvals according to utility’s policy for financial delegation of authority

INFORMATION TECHNOLOGY OPPORTUNITIES Part 2 of the report presents a cross section of IT related opportunities for water

utilities. IT opportunities evolve over time as technology innovations spur software and hardware changes, as well as new methods of communicating. Water utilities are advised to reconsider the value of their existing systems through routine IT planning and governance. Some of the major technology developments are shown in Figure S.5.


Figure S.5 Significant IT Developments over Time

One characteristic of today’s evolved information systems is that their productive

use is not confined to a single department within a utility. Figure S.6 depicts the major information systems typically used, and the utility departments (functional areas) that will benefit from using the systems. In most cases, there will be two or more departments benefitting. This characteristic suggests there may be a broad set of “stakeholders” for any given information system. As opportunities for new or upgraded information systems are considered, all potential stakeholders should be engaged, educated, and involved in the assessment.


Core Information Systems

Functional Areas that Derive Benefits

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Industrial Control System/Process Control System

P S D S

Laboratory Information Management System P D S P

Computerized Maintenance Management System

S P P

Geographic Information System P P P P S

Capital Program Management System

D D P S P P D

Customer Information & Billing System S P S D P

Financial Enterprise Resource Planning System D S D D P P S S

Human Resources/Payroll Management System D D D D P D D P

P Primary beneficiary of this system S Secondary beneficiary of this system D Provides data for reporting and decisions

Figure S.6 Benefits of Core Utility Information Systems

IT opportunities are described in detail for a select group of utility functions: Operations Management Industrial Control System Maintenance Management Computerized Maintenance Management System Customer Service and Billing Customer Information and Billing System Meter Reading Automated Meter Reading Finance and Human Resources Enterprise Resource Planning (ERP) System Engineering and Projects Capital Program Management System Geospatial Asset Management Geographic Information System


Water Quality and Compliance Laboratory Information Management System Each section presents information about an IT opportunity in a consistent format.

The subsections include:

An introduction to the technology ― what type of system is being described. A brief recap of business benefits associated with successful system use. Trends that have affected the technology ― what’s new with these systems. Implementation considerations for a new or upgraded systems project.

In addition, there are IT opportunities that cut across all utility functional areas.

Two notable systems are described in depth:

System Integration and Business Process Management Systems ― the standard protocols and software responsible for moving data between separate systems and orchestrating services provided by separate systems so that business processes become as “seamless” as possible. For example, an integration system can be used to ensure customer service, operations and maintenance teams participate in an end-to-end utility process for managing system shutdowns, customer notifications, and repairs.

Business Intelligence and Reporting Systems ― software and databases that enable utility performance management, analytics, and reporting of data combined from multiple systems. These systems are used to create management level dashboards and report on key performance indicators.

INFORMATION TECHNOLOGY IMPLEMENTATION

Part 3 of the report focuses on IT implementation practices that will most likely

benefit utilities. Utilities are advised to consider that IT implementations, and particularly software-based systems, are implemented in ways that are both similar and dissimilar to capital design and construction projects. Accordingly, the methods for procurement and management of implementation may be different.

Software selection and procurement is described in detail. The recommended

process includes Identifying stakeholders and assembling a cross-functional team Gathering requirements and creating business process models Formulating system testing and validation plans Assembling and administering a request for proposals Crafting a selection plan Executing the selection plan One key difference between software projects and capital construction projects is

that leading commercial software products are highly malleable and can adapt to a wide


range of business requirements. With one product, many outcomes are possible. The traditional sequential implementation approach for these products is too constraining. A more flexible and adaptive approach may be more appropriate, as shown in Figure S.7, however, extra management attention is required to successfully execute such an approach and avoid major risks.

Figure S.7 Traditional Methodology and EPIC Process

To manage the elevated risks attendant to IT implementations, a formal approach

is recommended for IT program and project management. The formal approach starts with development and approval of a Project Charter, which is essentially an agreement among stakeholders with respect to the scope, justification, and major resource commitments. Beyond the Project Charter, a proven project management approach is advisable, such as the one defined by the Project Management Institute Body of Knowledge (also known as PMBOK).

Implementation of IT solutions is both a technical challenge and an organizational challenge. More often than not, the technical issues of system implementation are solved before the organization fully adopts and effectively uses the system. Organizational Change Management is the discipline of proactively planning and managing the impact of change on the organization. The motivation for doing so is illustrated in Figure S.8, which depicts the effects of a major change over time on people and organizational productivity.

Typically for IT projects in which employees are asked to use a new system, business performance will decline during initial use. But the goal is actually an improvement in performance. Organizational Change Management seeks to minimize the depth of decline and shorten the timeframe for recovery so that the benefits of improved performance are realized sooner.


Figure S.8 Performance Management through OCM

MANAGING INFORMATION TECHNOLOGY

The practice of managing the information technology function in a water utility is

similar to many other organizations. Several best practices are presented in detail in Part 4, because their adoption by most utilities will result in a better return on the IT investment and fewer management issues related to IT.

IT Service Management

IT Service Management is the process by which the IT organization, in

collaboration with all other departments, defines the services it offers, commits to service level agreements, and then executes the necessary system operations, maintenance, and support functions to provide the agreed level of service. The emphasis is on making an explicit connection between the business needs for IT related services, and the technical work performed by IT technicians, engineers, and analysts.

The most common customer-facing service provided by IT is a “Helpdesk”; however, the typical organization will define 20 to 30 services with corresponding service levels under the IT Service Management umbrella, including system availability and response times. IT Service Management is executed using the familiar “Plan-Do-Check-Act” approach, as shown in Figure S.9.


Figure S.9 IT Service Management Improvement Processes

IT Efficiency and Cost Reduction

An IT organization should have an ongoing process for reducing “total cost of

ownership” for IT. Due to innovations in the past 10 years, IT managers have many opportunities to reduce costs and improve efficiency. Some of these initiatives have the added advantage of contributing to lowering the carbon footprint of a utility. These technology investments, many of which are more recent innovations, include

Virtualization Software as a Service Cloud Computing Service-Oriented Architecture Green Computing Initiatives Storage Technologies Mobile Computing

Data Governance

Utilities have often been described as “data rich and information poor.” This may be attributed to a lack of system integration, or it may simply be the legacy of compartmentalized management of data, which leads to redundancy, inconsistency, and pockets of data. Data Governance is the process by which an organization classifies and manages data to achieve appropriate confidentiality, availability, and integrity of information assets across the entire organization. Data Governance encompasses multiple focus areas, as shown in Figure S.10.


Figure S.10 Multiple Focus Areas for Data Governance

While IT Governance defines management decision making across all IT

resources, Data Governance is a more specialized technical function focused specifically on the information assets of the organization. The business objective of Data Governance is to ensure that information is properly classified and proper controls are in place to ensure the necessary confidentiality, availability, and integrity of data across the utility. RESEARCH PARTNER: U.S. Environmental Protection Agency


executive summary: high-performing information systems aligned

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