IT strategy to master unbundling in the utilities industry
Information management

Helping the client to adjust the company’s IT architecture in response to new regulations in the German energy market


Challenge

Following the introduction of new regulations in the German energy market, our clien’'s billing system no longer complied with legal requirements, particularly in regard to data confidentiality and data formats. 


Our client wanted advice on adapting its IT architecture to take account of the new legal requirements. A number of factors were to be considered:

  • The existing billing system was used simultaneously at the company’s two major sites. In addition, a multitude of site-specific IT systems would be affected by changes to the billing system.
  • Harmonization of business-unit processes across sites had yet to be implemented. As a result, potential future scenarios had to be assessed at each site separately.
  • The legal position was changeable, since new directives were already under discussion by the regulator. As a result, the targeted IT architecture had to be as flexible as possible.
     

Approach

  • We began by establishing a set of key questions:
  • Which of the possible IT architectures would fulfill the legal requirements?
  • Which IT solution should be favored in terms of technical and economic adequacy? 
  • What would be the ideal migration path for establishing the target IT architecture?
  • What costs would be involved, and when would they occur?

 

We structured the project in four phases. The first phase comprised an initial investigation at the two sites. This allowed us to acquire information on strategic plans and possible future requirements and determine the critical factors that would influence decision-making. 


The aim of the second phase was to recommend a target IT architecture. We identified a number of potential architectural approaches and evaluated them according to clear criteria:

  • Compliance: did the architecture fulfill all legal requirements?
  • Process efficiency and flexibility: to what extent would the architecture affect business processes?
  • IT sustainability: how easily could the IT solution be adapted to future requirements?
  • Costs and feasibility: what degree of re-organization would be required? 

 

The third phase involved a detailed investigation of the selected architecture. We evaluated various migration options and defined the ideal migration steps. Finally, we drew up an implementation plan, including a detailed timetable and project structure.
 

Value

Arthur D. Little recommended target IT architectures for possible regulatory scenarios and delivered a milestone plan, showing clearly when and how to move to the next stage of IT architecture.

 

As a result, our client was able to reduce the investment required to comply with new regulatory requirements, and to minimize the risk arising from the changeable legal environment.