“Smarter” outsourcing set to increase in the global Energy & Utilities industry

Monday, 23 January 2012

Pune, India, 07 December 2011

New research from HfS Research, the leading research analyst firm focused on outsourcing and shared services strategies, and co-authored by ValueNotes, a leading provider of business research, highlights the gradual shift occurring in the energy & utilities (E&U) industry. This sector is evolving from large nationalized natural monopolies to smaller de-regulated, privatized enterprises which are adopting outsourcing as a key strategy to overcome multiple business challenges. Key findings in the report discuss the following market dynamics:

The E&U industry is facing issues such as the pressing need to “go green” by generating electricity from renewable sources, strengthening the security of energy supply high price volatility for oil products, pressure from regulators to incorporate “smart grid” technologies and pursue new revenues of growth from a sluggish economy..
There has been an increase in the level of de-regulation in the industry which has brought in competition for the older companies. Services are now offered at more competitive rates, and in order to increase profitability and increase revenues, outsourcing has emerged as a key solution.
The current industry is characterized by the following factors – an increased level in customer centricity and the adoption of new technology, dominated by the “Smart Grid” network, Companies are balancing their strategies by maintaining the focus on their end users and increasing the level of automation and computerization of their services.
The service provider landscape features a wide range of vendors, ranging from end-to-end comprehensive solutions providers to relative newcomers offering horizontal services. The oldest players in this market offer BPO, ITO and consulting solutions for the industry.

The introduction of the “Smart Grid” has led to an enormous amount of unprocessed data. Emerging outsourced services such as Meter Data Management and Data digitization are increasingly being offered by service providers. Companies are partnering with ERP solutions providers and smart meter manufacturers to offer system integration solutions for their clients. These services will revamp CIS systems, billing services and offer high value research and analytics solutions.

Trends such as these have been explored in the new HfS Research Market Landscape titled “The Utilities Sourcing Landscape in 2011: Are Global Utilities Outsourcing Smarter?” The study investigates industry drivers and the major services outsourced the service provider landscape and segmentation, and a discussion of trends in outsourcing over the next few years. The report is appended with the HfS FormGuide, which offers buyers a quick way to identify and understand the providers operating within a particular market niche.

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