Friday, December 03, 2010

Case Study: Enel Green Power Uses PPM to Gain Visibility, Orchestrate Myriad Energy Activities Across 16 Countries

Transcript of a sponsored BriefingsDirect podcast, part of a series on application lifecycle management and HP ALM 11 from the HP Software Universe 2010 conference in Barcelona.

Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Download the transcript. Sponsor: HP.

Dana Gardner: Hello, and welcome to a special BriefingsDirect podcast series coming to you from the HP Software Universe 2010 Conference in Barcelona.

We're here in the week of November 29, 2010 to explore some major enterprise software and solutions, trends and innovations making news across HP’s ecosystem of customers, partners, and developers. [See more on HP's new ALM 11 offerings.]

I'm Dana Gardner, Principal Analyst at Interarbor Solutions, and I'll be your host throughout this series of HP sponsored Software Universe Live Discussions. [Disclosure: HP is a sponsor of BriefingsDirect podcasts.]

Our customer case-study today focuses on Enel Green Power and how their Italian utility business has benefited from improved management of core business processes and gained visibility into new energy projects, also adhering to compliance through better planning and the ability to scope out new projects comprehensively.

To learn about Enel Green Power’s innovative use of project and portfolio management (PPM), please join me now in welcoming Massimo Ferriani, CIO of Enel Green Power in Rome. Welcome.

Massimo Ferriani: Thank you.

Gardner: Tell me a little bit about your issues, your strategy, when it came to managing such a large and diversified company. Perhaps you could start by describing Enel Green Power and where you operate?

Ferriani: Enel Green Power is one of the leaders in the renewables market. We're fighting with the Spanish Iberdrola Renewables every day in order to find out who is the leader of this market.

We have some important differences, compared to the other competitors. First of all, we operate in 16 countries. The next one operates in 12 countries. So, we have 30 percent more, but it's important for us in order to decide our strategy and how we have to invest.

All of the other competitors basically work on a couple of renewable technologies -- wind and solar. Enel Green Power works in all the most mature technologies such as hydro, geothermal, wind, and solar.

If you think about a matrix to cross technologies and countries, we have a lot of trouble, because we operate four technologies in 16 countries. This is very important for the IT strategy as well, because we're slightly different compared to conventional generation, which is arithmetically easy to pace from carbon combustion to the energy product.

Asset portfolio

For renewables, it's difficult, because we have more than 300 plants all around the world with four technologies. So, it's an asset portfolio that we have to operate, and we have to reduce the risks. When we decided to deploy IT platforms, we didn’t think that it was a good idea to deploy conventional generation IT platforms, but to build up new platforms more fitted to renewables' needs.

We thought about the main objective in deploying these platforms and said, "Okay, maybe we have to deploy platforms that permit Enel Green Power to minimize the portfolio risk, in order to know exactly what production should be." For us, knowing the production is a condition. It's not a main output. There's no sense in knowing the exact production of a plant on a small island in Greece. That may be irrelevant, considering all the plants we have.

We have to know production, but we have to know exactly the production that we're promising to sell to the market.

Gardner: You have many different types of renewable sites. This left you with many different choices on those sites, but it seems to me you need it to centralize. You need to have a single PPM solution. Tell me a little bit about why centralization and control became important?

Ferriani: This follows the business strategy. The business strategy is to manage centrally and operate locally. So, IT had to follow the strategy. Our main IT platforms are developed with the objective to be global. Global doesn’t mean managing everything centralized, but to manage the IT platform as centralized, because it's better for synergies and in terms of costs. But, because we have to fit local needs, we we have to localize these platforms in 16 countries.

For PPM, as well, we decided to have a global, centralized, unique platform, in order to gather and collect all the data that we get from the field. This is one of the problems that we frequently have because, in effect, the operation is located everywhere. And, it’s not easy to collect information from each field operation.

It’s important to have global IT platforms, because one of our main objectives is that all our people have to work in the same way.



We have lot of plants in the middle of nowhere -- in the middle of the Nevada desert and in the middle of the Mato Grosso in Brazil. We have to gather information from these plants. So, it’s important to have global IT platforms, because one of our main objectives is that all our people have to work in the same way and because this market is so strange.

It depends a lot on the regulations in a country. It could be that a country that wasn't interesting for us some months ago will become absolutely interesting. This is the case today of Romania. Romania adopted a regulatory incentive scheme so interesting for us that we decided to switch 500 million euros from other countries to Romania.

The whole company has to follow that, but it’s important for us that all the people could work in the same way on the systems. If we have to move people from other countries to Romania, it’s important that they keep on working on the same tools.

Gardner: Very good. So when you looked into what PPM tools and platform would be the right choice, what were the criteria? What were the service level agreements (SLAs) or requirements that you were interested in getting the right choice for your PPM?

Setting the main goals

Ferriani: First of all, it’s important to set the main goal of the PPM solution. Now, the PPM solution lets Enel Green Power manage its own worldwide portfolio initiatives, both business development side and the plant construction Phase 2, because we have to remember that the business development hands over the construction of the project.

We have to do it through building a unique centralized integrated platform, valuable to all the countries, designed to certify the market value of the pipeline and the potential future production related to that pipeline. For us, it's absolutely important to forecast better, to make budgets, and so on. It had to be designed to support people, our colleagues, in activities like planning, project development, reporting, document management, and so on.

So when we decided to deploy this platform, we had a lot of work for a couple of reasons.

First of all, because we wanted to develop an integrated in-house platform in order to map the AGP core processes of the project, and at the same time to implement algorithms to develop a portfolio evaluation.

The second was to investigate adopting a standard solution available on the market that allowed us, with little customization, to fit the need of the business. It's important to underline that, when we started this project, it was the end of May, 2010. We already knew we were going to have an IPO. We didn’t know the time exactly, but we had to be ready for the end of October, the estimated date of the IPO.

A few days after the IPO, the result of the third quarter were to be presented. So, it was very important to have the platform ready at the end of October in order to certify the value of the pipeline after the IPO -- and we did it.

We adopted the HP solution, because the HP people convinced us that with a minimal set of customization we would be ready for the end of October -- and we did it.



Gardner: So this was very important for your company, but the time had to be quick in order for you to reach your financial objectives and, in a sense, create the right value for your company. Tell me how you were able to do this so quickly.

Ferriani: In the market, there is a great variety of PPM solutions. We decided not to make our own solution, because, in general, we prefer to buy standard solutions in the market. Considering the level of centralization of this project we decided to adopt a standard solution with only a set of customizations that permitted us to reach our goals and be ready for the end of October.

We adopted the HP solution, because the HP people convinced us that with a minimal set of customization we would be ready for the end of October -- and we did it.

We chose HP because of the elements important to deploy such a platform. First of all, strong automation in the collection of the data. As I said before, also important for us were simplicity and flexibility. Also, with reference to our geographical distribution everywhere, the adoption of a solution supported with global support was another constraint and was absolutely important.

We needed a standard technology accessible from a lot of countries and with integration with other applications that we have, for example Microsoft Project. We also required scalability and platform growth -- and HP has a strength on this point -- because we are adopting a web service architecture. And, we wanted the viability of a unique homogenous view of mandating KPIs.

Gardner: What were the results? You had an awfully big challenge and you had a little bit of time to do it. Tell me how it worked out in the end?

A long life ahead

Ferriani: First of all, it's important to say that we are in the first phase of the project. So the project has a long life ahead.

We're only in the first phase in order to support the IPO and to support the certification of the market value of the pipeline. But, the main benefits of this platform for the business are acquisition and centralization of the data.

This is, as I said, for the certification of the market value of the portfolio initiatives in general, both business development and construction as well. Knowing that these steps that would flow is very important to a lot of the departments in this value chain. One is procurement, because they have to plan all the purchasing in relation of the progress state of the pipeline and the operation. And, it’s important for the operations, when you think of switching investments from one country to another one.

Business development has decided to switch a big part of the pipeline from North America to Romania. That's absolutely huge to manage. It’s important for the automation to monitor all the steps of the workflow, of the individual steps of the process, to manage the workflow authorization of the individual steps, and monitor progress of the individual steps. All these data have to support us in order to plan the strategy. So, there are plenty of benefits and maybe more benefits in the future with the evolution of this platform.

Gardner: Very good. Is there anything in particular about the PPM platform from HP that has really impressed you? Is there anything that you didn’t expect but have been surprised?

For us, the flexibility was one of the three main strengths on this platform and the reasons we chose HP.



Ferriani: Yes, the flexibility. For us, the flexibility was maybe one of the three main strengths on this platform and the reasons we chose HP. But, the best one, as I said before, was the minimum customization we needed in order to fit the first phase. It’s not easy to have only three months time to set 64 workflows, because the local business development wants to fit their workflow on these needs. It is not easy, because the central business development wanted to manage centrally.

So, the ability to mix this central point of view with the local ones was another strength of HP Solution.

Gardner: Well great. We have been hearing about how Enel Green Power’s innovative use of project and portfolio management has benefited their business. It sounds as if you’ve got in quite a bit of upfront completeness and yet flexibility that’s allowed you to balance the needs of your local organizations with the demands of your central organization. Thank you so much.

Ferriani: Thank you very much.

Gardner: We've been joined by Massimo Ferriani, the CIO of Enel Green Power in Rome. This is Dana Gardner coming to you from a BriefingsDirect live podcast in Barcelona at the HP Software Universe 2010 Conference.

Look for this and other podcasts from this event at the HP.com website as well as via the BriefingsDirect network. Thanks for joining, and come back next time.

Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Download the transcript. Sponsor: HP.

Transcript of a sponsored BriefingsDirect podcast, part of a series on application lifecycle management and HP ALM 11 from the HP Software Universe 2010 conference in Barcelona, Spain. Copyright Interarbor Solutions, LLC, 2005-2010. All rights reserved.

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