Artificial intelligence, or AI, has recently been a hot topic for news stories. Another headline-making subject continues to be the energy crisis.
Where these two subjects collide is the need for energy companies to invest in digital technologies. It is becoming ever more urgent for gas and electricity companies to accelerate their digitalisation plans to manage growing supply and demand complexity.
Utilities that modernise their operations through deep digitalisation will be better placed to cope with this complexity. How well they do that in 2023 and the next few years will determine their long-term growth.
The obsolescence obstacle
So, what’s holding energy companies back? The growing obsolescence of their digital infrastructure is a difficult hurdle to overcome.
Whether or not you buy into the apocalyptic warnings about AI, it’s impossible to overlook the accelerating speed of the technology’s development. It’s not just AI; digital technologies, such as advanced process automation, IoT devices, digital twins and blockchain, are also advancing rapidly.
The sheer pace of development means that legacy infrastructure is quickly outdated. Unless they modernise their systems, energy companies cannot take full advantage of such technologies to increase resilience and flexibility, while also meeting their net zero commitments.
Modernisation of legacy systems could be a complex task; companies are reluctant to remove legacy systems, despite their inability to provide the advanced capabilities needed. This may, in part be because legacy technology is deeply embedded in the company’s ways of working and is seen as being too difficult to change.
Migrating to the cloud eliminates or reduces the high costs of running data centres; strengthens security through increased resilience, provides better access management and automated patching; accelerates agility with near-instant scalability to match changing demand. Further, it increases innovation with cloud-native apps and processes that can take advantage of AI and third-party development to enable continuous product development.
Planning and resourcing are critical
However, large-scale cloud modernisation is a multifaceted undertaking. There needs to be an understanding of the current status and a definition of the desired outcomes. There must also be a strategy that covers the distinct phases of adoption - build, design, govern and operational excellence.
Without such a strategy, energy companies risk becoming stuck mid-migration, not achieving the expected benefits of cloud and may suffer rising costs without a clear indication of the causes. One recent survey found that as much as 32% of cloud spending is wasted and that cloud projects are, on average 13% over budget.
Nor does migrating applications to cloud automatically deliver the elasticity, resiliency, ease of deployment and flexibility that the cloud environment offers. Modernisation is also needed to transform the existing application environment into something more agile, elastic and highly available, as well as being easier to operate and maintain.
Implementing a cloud DevOps culture is key to achieving cloud-native capabilities. This calls for the deployment of CI/CD to release code in their applications; building Infrastructure as Code and Terraform to build the platform; relying on containers and Kubernetes technologies; and automating processes.
Simplify cloud modernisation
Achieving cloud migration and modernisation demands significant skills and resources that many utilities may lack. NTT DATA can help.
To help energy companies move to the cloud, we first assess their current state and future goals, before identifying the best cloud platform and architecture for their needs, as well as the security and compliance measures to protect their data. We then design a cloud roadmap that covers both technical and business aspects of the transformation. We leverage our automation tools and other capabilities to accelerate the cloud migration and modernisation process, while also being flexible to adjust to changing circumstances.
Our methodology is well established and has helped energy companies deal with a lack of visibility of increasingly obsolete infrastructure and complex application landscape. NTT DATA provides companies with an in-depth analysis of their obsolescence position and associated business and technology risks. It also defines a migration strategy including a migration plan, roadmap and the required investment costs.
To find out more about how NTT DATA can help you overcome obsolescence, please book a complimentary cloud consultation here.