Supercharging Electric Utilities With Material MDM

SUPERCHARGING

ELECTRIC UTILITY COMPANIESWITH

MATERIAL MDM

Webinar - May 2016www.verdantis.com | [email protected] © 2016 Verdantis Inc. All Rights Reserved

http://www.verdantis.com/

About the Presenter

Arthur RaguetteExecutive Vice President, Verdantis, Inc.

[email protected]

+1 609 799 5665 x225(0)

Arthur is very passionate about the application of innovative technologies

to solve real-world business problems with a strong emphasis on large

enterprise solutions.

He has more than a decade of experience of working with Software for

Master Data Management and Data Governance for multiple domains and

across industries. Arthur’s prior technology passions included high

performance B2B middleware and hybridized SaaS applications for HR,

Employee and Education related domains.

www.Verdantis.com | [email protected]


The Verdantis ExperienceMaterial Master Data Cleansing and Governance

• Over 12 years of Material and Product Master expertise and projects with Global clients delivering

unmatched technology and attention to ROI.

• Experts in Material / Part Classification and Attribution.

• SaaS deployed solutions to more cost and time effectively compliment major ERP/EAM and Legacy

systems.

• The most comprehensive suite for collaborative and automated high speed batch material data

cleansing solutions – Verdantis Harmonize.

• Options for On-going new Item create and data governance with embedded classification and

attribution models – Verdantis Integrity.



Importance of Material MDM for Utilities

Large number of MRO/Spare parts:

Critical to ensure continuous supply:

MDM helps in maintaining consistency in item details and improves item setup

which makes material search more efficient and effective

MDM’s capability to provide consistent inventory information enables efficient

handling, storing, financing, and accounting of operational support inventory. In turn

this supports continuous supply and expected productivity.




Changing technology paradigm

Technology is constantly evolving to address various business challenges.

Google like searching and the shopping cart metaphor are now common

place.

If you can search and find inventory easily, redundant and duplicate orders

can be reduced significantly.

Cont’d

Pressure to manage costs due to stringent regulations:

Sourcing: MDM enables utilities to order parts optimally and manage cost

pressures.

Inventory: With more reliable data at their fingertips, employees do not have to

worry about stock-outs and this reduces the reason to place excess “insurance”

orders or squirrel away parts.




Power Generation is critical and needs to be well-maintained with zero breakdowns

Electricity generation is streamlined by operations, which consumes maintenance, spares,

and repair information. Missing technical attributes and other gaps in data make this

process less efficient, which impacts performance.

Multiple locations necessitate standardized and normalized data to ensure

smooth working of systems across the fleet

With multiple electricity generation plants and distribution facilities, standardized data

ensures that various systems are able to interact smoothly.

Cont’d



Why Electric Utility Companies should consider Material MDM

1

2

3

With rising competition, it is essential to streamline expenditures

High costs are always an issue, but with new technologies and efficiencies,

utilities have to control costs better and make cost management a positive

for them. This can help counter the competition better.

The need for consistent data across different EAMs

The new world runs on data, and companies that manage data better

will get a huge leg-up in the race to the top. A focus on consistent

data across different EAMs can help Utilities manage their strategies

better.



Unique Case of MDM in an EAM Scenario

Need for a single and authoritative source of material master data

A constant challenge for utility companies, specifically on the generation side, has been

the difficulty for one facility to look into another for a part. MDM enables material search

across facilities and reduces new purchase triggers - providing opportunities to optimize

inventory and reduce maintenance downtime.

Requirement for 2 distinct capabilities

Historical data cleansing: Historical data cleansing involves classification, de-duplication

& business-value enrichment of the existing legacy master data across all the enterprise

systems and other applications and organizational units.

Ongoing data governance: Ongoing data maintenance involves managing the quality of

master data on an ongoing basis and creating a framework for the creation, use, access,

and maintenance of data across the organization.



Why Indirect Materials Present a MISSED OPPORTUNITY

Savings from indirect materials generally ignored

The indirect materials category is one which can lead to significant savings if the data is managed

properly. For many commodities, it can return savings of 15%-18% with a comprehensive MDM

system in place that supports reduction in maverick spending.

Not just about Cost

Better Indirect material management directly affects reliability and efficiency of systems and

processes rather than just being about cost savings. Avoiding stock outs, especially of critical

components, leads to fewer breakdowns and ensures continuous, uninterrupted operations.



Benefits of Material MDM -The Industry Perspective

OPERATIONAL

EFFICIENCY

REDUCTION

OF WASTE

FEWER POWER

OUTAGESCUSTOMER

SATISFACTION




CUSTOMER

SATISFACTION

OPERATIONAL

EFFICIENCY

According to Aberdeen Research, accurate

and enriched MDM (integrated with EAM)

can improve operation costs by 17%.

Also, Material MDM helps reduce risk,,

prevent disruptions and increases

productivity.

Lastly improved data quality improves

informed decision making capabilities for

management and end users.

According to Aberdeen Research, an

enterprise can improve its

profitability by 4% by utilizing the benefits

of MDM over those that don’t.

This allows utilities to invest in improving

the customer experience and improves

customer satisfaction and loyalty in

competitive markets.




REDUCTION

OF WASTE FEWER POWER

OUTAGES

Standardized, de-duplicated, and enriched data

enables utilities to:

- search material across facilities,

- find maintenance spare parts quickly and

- reduce maintenance downtime significantly.

MDM helps in lowering asset carrying and

maintenance costs. Likewise

streamlined operations and greater process

compliance help in reducing waste.



Case Study – Client Scenario

Electric Utility Co in the US

The Company went live with its massive ERP and Master Data Management (MDM)

unification effort. It was the culmination of a three year effort to accomplish three key

tasks:

Unifying the company's accounting structure

Upgrading all client businesses and affiliates data, both regulated and non-regulated, to

a single version of SAP

Upgrading all units in client’s nuclear division to a single instance of client’s Enterprise

Asset Management (EAM) system for every aspect of the business.



Case Study – Verdantis’ role


Verdantis executed the project in a phased manner for the data set containing 600K

records. This included:

Interrogating existing item catalogs and classifying each item master correctly to the

appropriate global coding standard

Interrogating existing item descriptions

Extracting, normalizing and structuring existing item attribute data

Generating standard item descriptions from normalized and structured attribute fields



Case Study – Enterprise Benefits


Excess Inventory as well as inventory holding costs went down. The staff could rely on the

data available to them. This meant no duplicate orders and no insurance stock items.

Better data governance led to a more useful search function. This enabled staff to cut down

on redundant orders and get their hands on parts easily, thereby saving time and money.

Detailed catalogue descriptions with technical specification provided better information -

not only for procurement but also for operations people in determining how and where

items will be sourced, purchased and deployed.

Elimination of item duplication by automatically interrogating the existing master database

and identifying potential duplicates ensured long term reliability and accuracy of inventory

data.



5 Reasons why MDM should be a part of EAM Blueprint

Why MDM

should be a part of

EAM Blueprint

During EAM

Implementation

Post EAM

Implementation

Clean data

Quicker implementation

Eliminate redundant orders

Ongoing efficiencies

Inventory rationalization




During EAM Implementation

Clean data

Master Data Cleansing should be planned at the beginning of the project. A

third party expertise with deep domain skills and capabilities in providing

automation will clean and improve existing bad or incomplete data.

Quicker implementation

An MDM initiative combined with AI-based technology and deep domain

expertise makes EAM implementation quicker as the time wasted on data

parsing is minimized owing to consistent & reliable data




Post EAM ImplementationEliminate redundant orders

With Standardized, de-duplicated, accurate and enriched master data, bringing about a

synergy among all the applications, legacy and proprietary systems of the company

provides better visibility to the enterprise to identify and removes redundant orders.

Inventory rationalization

MDM prevents data duplication at source, ensures a robust workflow process, and validates

and enriches master data on a real-time basis, enabling enterprise to rationalize inventory

optimally.

Ongoing Efficiencies

Effective and stringent data governance frameworks and approval workflows ensure master

data integrity, improve procurement process times and mitigate risks of supply chain

disruption.



MDM in the EAM Implementation Lifecycle

Integrating Master Data Management with an ERP/EAM system can deliver many significant

benefits to an enterprise. The below mentioned statistics are part of research done by Aberdeen

which reveal the improvement that incur during a Master Data Management initiative with EAM

implementation.

Metrics NO MDMMDM integrated

with ERP

Improvement in complete and on time deliveries of

supply chain achieved from ERP Implementation

Inventory Accuracy

Improvement in Inventory turns achieved from ERP

implementation

+14%

91%

+33%

+18%

96%

+43%

(Source: Aberdeen Research)



MDM in the EAM Implementation Lifecycle

(Source: Aberdeen Research)

Optimized ROI from EAM implementation with MDM Integrated

Metrics NO MDMMDM integrated

with ERP

Reduction in operational costs post ERP implementation

Reduction in administrative costs post ERP implementation

Internal business process schedule compliance

Year over year change in time to decision

Change in profitability over 2 consecutive fiscal years

-14%

-12%

90%

-17%

+9%

-17%

-16%

93%

-18%

13%

Based on earlier detailed statistics, it can be easily concluded that implementing an MDM initiative

during an EAM implementation using automated solutions that combine AI-based technology and

deep domain expertise can ensure the success of the project. Master Data Management can

unlock the true potential of an EAM implementation project and achieve expected results.



The Verdantis ExperienceMaterial Master Data Cleansing and Governance

• Over 12 years of Material and Product Master expertise and projects with Global clients delivering

unmatched technology and attention to ROI.

• Experts in Material / Part Classification and Attribution.

• SaaS deployed solutions to more cost and time effectively compliment major ERP/EAM and Legacy

systems.

• The most comprehensive suite for collaborative and automated high speed batch material data

cleansing solutions – Verdantis Harmonize.

• Options for On-going new Item create and data governance with embedded classification and

attribution models – Verdantis Integrity.

Note: Integrity leverages classification model, values, spec sheets, abbreviations, UOM and more from

Harmonize



Supercharging Electric Utilities With Material MDM

Business

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