Supercharging Electric Utilities With Material MDM

SUPERCHARGING
ELECTRIC UTILITY COMPANIES
WITH
MATERIAL MDM
Webinar - May 2016www.verdantis.com | info@verdantis.com © 2016 Verdantis Inc. All Rights Reserved

About the Presenter
Arthur Raguette
Executive Vice President, Verdantis, Inc.
Arthur@Verdantis.com
+1 609 799 5665 x225(0)
Arthur is very passionate about the application of innovative technologies
to solve real-world business problems with a strong emphasis on large
enterprise solutions.
He has more than a decade of experience of working with Software for
Master Data Management and Data Governance for multiple domains and
across industries. Arthur’s prior technology passions included high
performance B2B middleware and hybridized SaaS applications for HR,
Employee and Education related domains.
www.Verdantis.com | info@verdantis.com

The Verdantis Experience
Material Master Data Cleansing and Governance
• Over 12 years of Material and Product Master expertise and projects with Global clients delivering
unmatched technology and attention to ROI.
• Experts in Material / Part Classification and Attribution.
• SaaS deployed solutions to more cost and time effectively compliment major ERP/EAM and Legacy
systems.
• The most comprehensive suite for collaborative and automated high speed batch material data
cleansing solutions – Verdantis Harmonize.
• Options for On-going new Item create and data governance with embedded classification and
attribution models – Verdantis Integrity.

Importance of Material MDM for Utilities
Large number of MRO/Spare parts:
Critical to ensure continuous supply:
MDM helps in maintaining consistency in item details and improves item setup
which makes material search more efficient and effective
MDM’s capability to provide consistent inventory information enables efficient
handling, storing, financing, and accounting of operational support inventory. In turn
this supports continuous supply and expected productivity.

Changing technology paradigm
Technology is constantly evolving to address various business challenges.
Google like searching and the shopping cart metaphor are now common
place.
If you can search and find inventory easily, redundant and duplicate orders
can be reduced significantly.
Cont’d
Pressure to manage costs due to stringent regulations:
Sourcing: MDM enables utilities to order parts optimally and manage cost
pressures.
Inventory: With more reliable data at their fingertips, employees do not have to
worry about stock-outs and this reduces the reason to place excess “insurance”
orders or squirrel away parts.

Power Generation is critical and needs to be well-maintained with zero breakdowns
Electricity generation is streamlined by operations, which consumes maintenance, spares,
and repair information. Missing technical attributes and other gaps in data make this
process less efficient, which impacts performance.
Multiple locations necessitate standardized and normalized data to ensure
smooth working of systems across the fleet
With multiple electricity generation plants and distribution facilities, standardized data
ensures that various systems are able to interact smoothly.
Cont’d

Why Electric Utility Companies should consider
Material MDM
1
2
3
With rising competition, it is essential to streamline expenditures
High costs are always an issue, but with new technologies and efficiencies,
utilities have to control costs better and make cost management a positive
for them. This can help counter the competition better.
The need for consistent data across different EAMs
The new world runs on data, and companies that manage data better
will get a huge leg-up in the race to the top. A focus on consistent
data across different EAMs can help Utilities manage their strategies
better.

Unique Case of MDM in an EAM Scenario
Need for a single and authoritative source of material master data
A constant challenge for utility companies, specifically on the generation side, has been
the difficulty for one facility to look into another for a part. MDM enables material search
across facilities and reduces new purchase triggers - providing opportunities to optimize
inventory and reduce maintenance downtime.
Requirement for 2 distinct capabilities
Historical data cleansing: Historical data cleansing involves classification, de-duplication
& business-value enrichment of the existing legacy master data across all the enterprise
systems and other applications and organizational units.
Ongoing data governance: Ongoing data maintenance involves managing the quality of
master data on an ongoing basis and creating a framework for the creation, use, access,
and maintenance of data across the organization.

Why Indirect Materials Present a
MISSED OPPORTUNITY
Savings from indirect materials generally ignored
The indirect materials category is one which can lead to signiﬁcant savings if the data is managed
properly. For many commodities, it can return savings of 15%-18% with a comprehensive MDM
system in place that supports reduction in maverick spending.
Not just about Cost
Better Indirect material management directly affects reliability and efﬁciency of systems and
processes rather than just being about cost savings. Avoiding stock outs, especially of critical
components, leads to fewer breakdowns and ensures continuous, uninterrupted operations.

Benefits of Material MDM -
The Industry Perspective
OPERATIONAL
EFFICIENCY
REDUCTION
OF WASTE
FEWER POWER
OUTAGES
CUSTOMER
SATISFACTION

CUSTOMER
SATISFACTION
OPERATIONAL
EFFICIENCY
According to Aberdeen Research, accurate
and enriched MDM (integrated with EAM)
can improve operation costs by 17%.
Also, Material MDM helps reduce risk,,
prevent disruptions and increases
productivity.
Lastly improved data quality improves
informed decision making capabilities for
management and end users.
According to Aberdeen Research, an
enterprise can improve its
profitability by 4% by utilizing the benefits
of MDM over those that don’t.
This allows utilities to invest in improving
the customer experience and improves
customer satisfaction and loyalty in
competitive markets.

REDUCTION
OF WASTE FEWER POWER
OUTAGES
Standardized, de-duplicated, and enriched data
enables utilities to:
- search material across facilities,
- find maintenance spare parts quickly and
- reduce maintenance downtime significantly.
MDM helps in lowering asset carrying and
maintenance costs. Likewise
streamlined operations and greater process
compliance help in reducing waste.

Case Study – Client Scenario
Electric Utility Co in the US
The Company went live with its massive ERP and Master Data Management (MDM)
unification effort. It was the culmination of a three year effort to accomplish three key
tasks:
Unifying the company's accounting structure
Upgrading all client businesses and affiliates data, both regulated and non-regulated, to
a single version of SAP
Upgrading all units in client’s nuclear division to a single instance of client’s Enterprise
Asset Management (EAM) system for every aspect of the business.

Case Study – Verdantis’ role
Verdantis executed the project in a phased manner for the data set containing 600K
records. This included:
Interrogating existing item catalogs and classifying each item master correctly to the
appropriate global coding standard
Interrogating existing item descriptions
Extracting, normalizing and structuring existing item attribute data
Generating standard item descriptions from normalized and structured attribute fields

Case Study – Enterprise Benefits
Excess Inventory as well as inventory holding costs went down. The staff could rely on the
data available to them. This meant no duplicate orders and no insurance stock items.
Better data governance led to a more useful search function. This enabled staff to cut down
on redundant orders and get their hands on parts easily, thereby saving time and money.
Detailed catalogue descriptions with technical specification provided better information -
not only for procurement but also for operations people in determining how and where
items will be sourced, purchased and deployed.
Elimination of item duplication by automatically interrogating the existing master database
and identifying potential duplicates ensured long term reliability and accuracy of inventory
data.

5 Reasons why MDM should be a part of EAM Blueprint
Why MDM
should be a part of
EAM Blueprint
During EAM
Implementation
Post EAM
Implementation
Clean data
Quicker implementation
Eliminate redundant orders
Ongoing efficiencies
Inventory rationalization

During EAM Implementation
Clean data
Master Data Cleansing should be planned at the beginning of the project. A
third party expertise with deep domain skills and capabilities in providing
automation will clean and improve existing bad or incomplete data.
Quicker implementation
An MDM initiative combined with AI-based technology and deep domain
expertise makes EAM implementation quicker as the time wasted on data
parsing is minimized owing to consistent & reliable data

Post EAM Implementation
Eliminate redundant orders
With Standardized, de-duplicated, accurate and enriched master data, bringing about a
synergy among all the applications, legacy and proprietary systems of the company
provides better visibility to the enterprise to identify and removes redundant orders.
Inventory rationalization
MDM prevents data duplication at source, ensures a robust workflow process, and validates
and enriches master data on a real-time basis, enabling enterprise to rationalize inventory
optimally.
Ongoing Efficiencies
Effective and stringent data governance frameworks and approval workflows ensure master
data integrity, improve procurement process times and mitigate risks of supply chain
disruption.

MDM in the EAM Implementation Lifecycle
Integrating Master Data Management with an ERP/EAM system can deliver many significant
benefits to an enterprise. The below mentioned statistics are part of research done by Aberdeen
which reveal the improvement that incur during a Master Data Management initiative with EAM
implementation.
Metrics NO MDM
MDM integrated
with ERP
Improvement in complete and on time deliveries of
supply chain achieved from ERP Implementation
Inventory Accuracy
Improvement in Inventory turns achieved from ERP
implementation
+14%
91%
+33%
+18%
96%
+43%
(Source: Aberdeen Research)

MDM in the EAM Implementation Lifecycle
(Source: Aberdeen Research)
Optimized ROI from EAM implementation with MDM Integrated
Metrics NO MDM
MDM integrated
with ERP
Reduction in operational costs post ERP implementation
Reduction in administrative costs post ERP implementation
Internal business process schedule compliance
Year over year change in time to decision
Change in profitability over 2 consecutive fiscal years
-14%
-12%
90%
-17%
+9%
-17%
-16%
93%
-18%
13%
Based on earlier detailed statistics, it can be easily concluded that implementing an MDM initiative
during an EAM implementation using automated solutions that combine AI-based technology and
deep domain expertise can ensure the success of the project. Master Data Management can
unlock the true potential of an EAM implementation project and achieve expected results.

The Verdantis Experience
Material Master Data Cleansing and Governance
• Over 12 years of Material and Product Master expertise and projects with Global clients delivering
unmatched technology and attention to ROI.
• Experts in Material / Part Classification and Attribution.
• SaaS deployed solutions to more cost and time effectively compliment major ERP/EAM and Legacy
systems.
• The most comprehensive suite for collaborative and automated high speed batch material data
cleansing solutions – Verdantis Harmonize.
• Options for On-going new Item create and data governance with embedded classification and
attribution models – Verdantis Integrity.
Note: Integrity leverages classification model, values, spec sheets, abbreviations, UOM and more from
Harmonize

Supercharging Electric Utilities With Material MDM

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