The Infosys Utilities Blog seeks to discuss and answer the industry’s burning Smart Grid questions through the commentary of the industry’s leading Smart Grid and Sustainability experts. This blogging community offers a rich source of fresh new ideas on the planning, design and implementation of solutions for the utility industry of tomorrow.

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Utility Procurement - a New Vision

Innovation is part of the 'DNA' of Infosys, and we are always being asked to innovate by our clients. All too often however the procurement process constrains our ability to offer that innovation. The deliverables are given strict bounds, and we are only able to offer specific solutions. For example, the need may be for improvements in asset management, but the tender constrained to configuring and installing a particular software package. Whilst in a few cases that may be due to a poor procurement strategy, in most cases it is due to the constraints, both regulatory and corporate, that control how procurement can be undertaken.


Does it have to be this way? I believe that clients could procure in an innovative way, that allows their suppliers to show their ability to offer novel ways to solve problems. The process could be two stages, the first a simple pre-qualification exercise to determine a shortlist (as is currently undertaken), the second to deliver an outline design of the solution, where the client pays a small fee to the tenderers to get into far more detail than current tenders allow. This will enable the supplier to demonstrate their ability to deliver innovation, and the client to both understand that ability, and know how the supplier performs in a work situation. Such a process would enable to client to tackle much larger issues than generally covered in a tender, and indeed a few utility clients are already using a more agile approach. I will demonstrate with an example in asset management.


This example tender could be phrased "Devise a solution that will deliver an x% reduction in asset management costs, whilst producing a y% improvement in performance, without increasing overheads." In the pre-qualification, tenderers would need to demonstrate experience in such areas (although not necessarily in the same industry), and provide good and pertinent references: this would allow the client to shortlist. Tenderers could also consider partners to add to their bid, for example instrumentation suppliers and installers. In the tender, the client would allow a certain sum for each tenderer to produce their innovative solution, with sufficient access to client staff to determine constraints, both technological and business. This phase would of course need to be undertaken under non-disclosure agreements to protect all parties. Once the 'tender' is completed, the client would be able to select a supplier with a much greater understanding of that supplier's ability to innovate in a way that will benefit their business.


Whilst this system may seem strange to some in utility procurement, it is similar to those employed in areas like architecture, that have allowed buildings such as the Sydney Opera House to be developed. Do we want our future to be full of bland boxes, or Guggenheims?

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