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IT Powers the Energy Sector

April 28, 2015 by Michael Zipf 0

To survive in a digital economy, utility companies need innovative solutions. SAP S/4HANA wants to be one of them.

As they square up to deal with the changes caused by falling oil and gas prices, the rise of renewable sources of energy, the demise of the nuclear industry, deregulation, and digitization, enterprises in the utility, oil, and gas industries are really feeling the heat.

“Everything flows,” was how Simon Paris, President of Industry Cloud at SAP, began his keynote at the 10th International SAP Conference for Utilities, which this year was co-located with the International SAP Conference for Oil and Gas for the first time.

Paris was referring to commodities such as electricity, water, oil, and gas, which are the lifeblood of our economy. You’d think that the transformation currently sweeping through the utility, oil, and gas industries would be enough to make even the most level-headed decision-maker break out in a cold sweat. But the 1,200 or so attendees from 55 countries who converged on the CityCube trade fair and congress venue in Berlin seemed – outwardly at least – unperturbed: They were clearly eager to use this opportunity to network with their peers and find out about new solutions from SAP.

All eyes were on SAP S/4HANA, the fourth generation of SAP enterprise software, particularly when Peter Maier, General Manager of Energy and Natural Resources at SAP, teamed up with Henry Bailey, Head of IBU Utilities, for a video demonstration of how SAP S/4HANA meets the diverse requirements of utility companies and reduces complexity.

Maier explained how customers could lay the foundations for SAP S/4HANA by first migrating their ERP systems to SAP HANA. They could continue the simplification process, he said, by implementing SAP Simple Finance and then switching completely to SAP S/4HANA to net further optimizations in IT. SAP also gave details of its first industry-specific roadmap, indicating when oil and gas sector customers can expect to benefit from solutions powered by SAP S/4HANA for their industries.

Transformation to a digital enterprise

The agenda in Berlin included an array of information sessions and workshops – hosted by SAP experts explaining the latest innovations and customers reporting on how they are profiting from SAP solutions – and an exhibition at which SAP partners showcased their products and services. The clear message from everyone we spoke to at the event was that, if they want to survive in an increasingly competitive market, utilities need to step up their commitment to becoming digital enterprises.

In a witty and entertaining keynote, professor of forecasting and innovation James Woudhuysen dispelled any fears that the human appetite for energy – particularly in emerging markets – might be dwindling. But he also had some salutary advice for utilities, urging them to focus less on revenues and profits and more on research and development. “If we don’t make technological advances, we’ll fail,” was his stark warning, as he appealed to the industry to devote much more energy to innovation and to look more closely at all the things that are good about carbon, for example.

Klaus Heimann, a former SAP expert on the utility industry and now an advisor to SAP on the future of the sector, shares this view. Speaking to SAP News, he was adamant that this traditional, rather conservative industry needs to invest heavily in digital progress if it is to master the challenges ahead.

Learn more:

Peter Maier on the future of the oil and gas and utilities industries.

Top image: Shutterstock

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