Read how a major utilities player overcame inefficiencies and a lack of focus with a new organizational structure that eliminated traditional functional silos…
This asset management organisation was structured around traditional functional silos – operations, maintenance and planning. These islands of isolation created a high operational focus that diverted attention from critical asset management issues.
There was a tendency to push technical solutions rather than customer outcomes. Poorly-defined interfaces between divisions created inefficiencies, while depletion of strategic analytical skills meant investment planning operated below par.
Recognising the level of change required to transform the focus and performance of the organisation, the General Manager sought outside assistance, and called in Third Horizon.
Third Horizon was engaged to realign the organisation to an ‘asset owner’ operating model.
Key principles of the realignment included focusing on proactive rather than reactive asset management decision. Separating the responsibilities of ‘decision making’ from ‘doing’ would place greater focus on core asset management and enable long-term skill development. Greater emphasis on financial and risk analysis in the decision-making process would balance the previous focus on engineering and operational excellence. Co-locating non-core activities would achieve greater leverage and increase the focus of the rest of the organisation.
From this foundation, Third Horizon helped the client develop a new operating model. It included defining five new process areas to achieve better asset management outcomes. The new structure also more closely aligned roles and responsibilities to processes, and delivered detailed mapping and definition on all interactions across and outside the structure.
Third Horizon worked with the client to test the new structure in detail to validate all of the interactions and identify any organisational ‘trade offs’ and possible conflicts.
Following its success, the organisation is now migrating to the new operating structure.