Rising tide: How Northumbrian Water's CIO James Robbins is preparing for market competition

The water industry is about to be submerged in competition. Robbins tells Computing how the company is preparing

The regulated world of the water industry is about to undergo a revolution. From April next year, business will be free to buy their water from whomsoever they like - and that competition may be extended to consumers from as early as 2020.

Water companies like Northumbrian Water Group*, therefore, are in a race against time to prepare themselves and their systems. It isn't, says Northumbrian's group IS director James Robbins, just about improving customer relationship management systems accordingly, although that is part of the company's strategy.

It will also inaugurate a formal separation of retail and wholesale, similar to the split between BT's Openreach and Retail divisions.

"Our IT investments at the moment are swayed towards where we can add customer value and customer satisfaction. But the big thing that's happening in the industry right now is market reform. From 2017, for our business customers in water in the UK, there's going to be a competitive marketplace like there is for gas and electricity," says Robbins.

That's as if there wasn't enough to do already, with Robbins not just responsible for Northumbrian Water's IT - its ERP, billing and other standard systems - but also its operational IT. That is to say, the IT that underpins Northumbrian's water infrastructure from water purification to waste treatment, and the IT that oversees all that.

"[I'm responsible for] all of the SCADA [supervisory control and data acquisition] and telemetry, and the stuff that helps produce the water - our manufacturing systems - real-time data, that's also under the IS function as well. So it's 'OT' as well as IT," says Robbins.

The role doesn't necessarily require a PhD in Chemistry (as well as the requisite IT knowledge). But with more than 300,000 sensors across 40,000 kilometres of water and waste-water mains, and more than 400 treatment works, with infrastructural operational IT increasingly integrated with corporate IT, that is a lot of responsibility.

"It's about being the 'chief intelligence officer', ensuring that our operational systems are working in harmony: the people, the process and the technology delivering the right intelligence to the right people at the right time. The best way to understand this is by getting out with key operators to witness them using our data first hand."

He continues: "I would have thought any CIO needs to understand the core business processes. While I have only been in water four years, I've spent a lot of time upfront immersed in what the business does, how we support it, how we enable it and, therefore, finding out what's critical in our service.

"I also need to make sure that I have got people in my team who are really up to speed, so our SCADA engineers are what I call our 'rock-star engineers' because they need to really understand the water production and waste water treatment processes, as well as coding, machine learning when we do that, telecoms, Wi-Fi and so on.

"So we need to make sure that we have those sorts of people, but they take some time to develop within the business," says Robbins.

Licence to thrill

Ultimately, the Group is part of the Hutchison Whampoa conglomerate - the same company that owns mobile phone operator Three, via its Cheung Kong Infrastructure Holdings arm, along with UK Power Networks and Wales & West Utilities.

One of the benefits for Northumbrian's IT department is that it can tap Hutchison's global software licensing arrangements with major software vendors and get started on projects straightaway, free from long-winded procurement procedures.

One of the big projects implemented most recently - which is still ongoing as it is rolled out to various parts of the water company's network - is Project SNIPeR, a big-data project based on Oracle BI designed to identify potential bottlenecks across the company's water networks in the North East before they happen.

For Adrian Holmes-Morris, Northumbrian's BI team leader, the ready access to Oracle - rather than having to go through a long procurement exercise - helped speed-up the process.

In many respects, too, the project is a nascent Internet of Things implementation, with sensors feeding back data in real-time and Holmes-Morris's team providing sewer network staff at Northumbrian the means to be able to analyse and digest this information in order to work out where problems may be building up before they become acute.

"We identified four main areas: our data loggers, attached to our CSOs - combined sewer overflows. Then there was our spatial data, our geographic information system, showing our sewer network. That needed to be combined with rainfall data, which we get from the Met Office via a service called Rain Radar, which they issue to us every five minutes," Holmes-Morris told Computing.

* Northumbrian Water Group supplies 2.7 million customers in north east England with water and waste water services, where it trades as Northumbrian Water. It also supplies 1.8 million customers with water-only services in Essex and Suffolk, trading as Essex & Suffolk Water.

Rising tide: How Northumbrian Water's CIO James Robbins is preparing for market competition

The water industry is about to be submerged in competition. Robbins tells Computing how the company is preparing

He continued: "We amalgamate that into 15 minute reads, which we then associate with the data-logger information. And, finally, there's the asset details associated with the network," says Holmes-Morris.

"That combination enables us to manage and identify where we have issues within our sewer network; where we have potential levels of overflow, and we can then set up alerts against them and identify where things are reaching a critical point and can then do something about it. That's essentially where this comes in," he added.

Such systems reflects Robbins' aim to keep Northumbrian Water ahead of its rivals in the industry, not just in terms of customer service, but also the key performance indicators against which the water regulator Ofwat judges water companies' performance.

Intensifying competition

However, while the all-you-can-eat-style software licensing deals means that Robbins needs to have good reasons for not going Oracle or Microsoft, it doesn't prevent a pragmatic approach to software procurement.

"We are implementing Oracle customer care and billing on the wholesale marketplace, but in our new retail business we have gone for a different solution," says Robbins. "We've gone with a CRM product called Velocity by a company called Gentrack, and creating a cloud model. We plan to turn off our data centre services to the new market and taking the opportunity to accelerate our cloud strategy," he adds.

However, although Gentrack can count Ovo Energy among its UK customers, Northumbrian Water is the first to run it in the cloud, with Gentrack establishing its cloud facilities in a data centre in the North East.

And with competition in the water market looming, Northumbrian required a billing system capable of plugging-in to comparison websites to provide instant quotes, connections to credit reference agency Experian for debt recovery, and handle people switching from one company to another. Furthermore, like the billing system recently implemented by First Utility, it's highly flexible, too.

In addition to honing the organisation's customer-facing IT, Robbins is also focused on supporting the company when the business market for water is opened up to competition from April 2017.

The idea, is to enable national businesses, such as supermarket chains, to be able to contract for water services with just one company. This ought to make managing the water and waste contracts of a nationwide chain of businesses a lot easier and more efficient.

But as a result of that reform, water companies like Northumbrian will be required to separate their retail customers from the infrastructure side of the business, similar to the way in which the infrastructure side of BT (Openreach) has been separated from the retail side.

There are also moves afoot to introduce competition in the domestic market, too, from 2020. That's another reason why Robbins is focused on billing, CRM and other customer-facing systems. "It's not just about IT. It's business processes; it's people. I'm leading a business transformation programme. It's a huge investment - £30m-plus - in reconfiguring our wholesale-side systems to interact with a number of retailers in the B2B space.

For Northumbrian, IT is important not just in terms of delivering its services and ensuring customer satisfaction, but also because it has a regulator to satisfy and key performance measures to meet.

Youth and experience

Robbins is arguably one of the youngest CIOs in the country, but probably has more experience than a CIO parachuted from another department into such a position.

He cut his teeth at some fairly heavyweight organisations, including Northern Rail and transport services company Abellio.

Rising tide: How Northumbrian Water's CIO James Robbins is preparing for market competition

The water industry is about to be submerged in competition. Robbins tells Computing how the company is preparing

At rail franchise Northern Rail, Robbins was able to make the business case to shift from outsourced legacy mainframe IT dating back to the days of British Rail to a more modern SAP implementation - and saving money in the process over the relatively short-term of the company's rail franchise.

"We moved from legacy mainframe British Rail systems onto a modern SAP solution... It's a short-term franchise with little investment. So how do you make a business case for an SAP implementation without stripping costs out of the business?" asks Robbins.

The answer, he continues, was on focusing first on those areas that could generate the greatest cost savings. "We got some big wins in terms of engineering and materials management, business intelligence around finance costs and retail, and also reducing the costs of the mainframe solutions - it's not often your SAP licence model is cheaper than what you're replacing, but it was in this instance," says Robbins.

The challenge of many IT implementations, believes Robbins, is that while the costs invariably reside with IT, the benefits (including savings) are typically enjoyed elsewhere. "We need to create an environment where the IT team works collaboratively with colleagues in the business so that system benefits are maximised" he says.

The SAP implementation had followed a 2007 roll-out of 1,500 BlackBerry smartphones to train conductors, to the scepticism of many in Northern Rail - but the delight of the conductors themselves.

The various tangible and intangible benefits helped the project to quickly pay for itself. Conductors could get information quickly, and help passengers more thoroughly, while Robbins was able to implement a slew of projects that fed into it, such as automating some control-centre systems, which helped drive efficiency.

Robbins' approach to IT leadership, he believes, is strongly influenced by the systems theory he picked up studying Business Information Systems at Liverpool John Moores University. This focuses on the people and process elements of the age-old 'people, process and technology' approach to enterprise-IT leadership.

"The mindset that I learnt on that course was amazing. It meant that I was ten years ahead of my time," says Robbins, who laments that such courses appear to be dying out.

From university, Robbins went into coding with the Cooperative Pension Fund, migrating data from 12 different human resources systems into the Coop's pension fund - doing all the coding, testing, data migration, the lot. However, despite the workload the prospects weren't great.

"After a year, I left and went back to Liverpool John Moores University and did something called Knowledge Transfer Partnership, a government-funded initiative to get high-calibre graduates into SMEs. I went into a programme of work with Arena Homes, now called Your Housing, a £50m-turnover housing association, which had been formed as a result of a merger and wanted efficiency in its business processes and new systems," says Robbins.

One of the initiatives included the closure of three regional offices, putting housing managers into cars with tablet computers to deal with tenants' problems directly. That involved writing interfaces to integrate the mobile devices on a shoe-string, given the association's four-man IT team.

Having been at the heart of the transformation of Arena Homes, Robbins was recruited to head-up the IT at Northern Rail - at the age of just 27, managing some fairly old hands who were twice his age. "I went to meet them in the pub on day one, and I could tell they were thinking, 'what the hell has the chief financial officer done?' This is a kid...

"It was tough. It's about your behaviour. When you sit down with someone and they commit to doing something for you, I just held them to account. I gave everybody a chance, set some tasks, they chose the deadline. If, then, they don't deliver, you have to sit down and ask what we need to do to help them deliver," he says.

At Arena Homes, Northern Rail and Abellio, when the businesses no longer required "transformation", Robbins got itchy feet. But with competition coming to the water industry from next year on the commercial side and, perhaps, to consumers from 2020, not to mention the challenge posed by implementing Internet of things operational technologies across Northumbrian's infrastructure, Robbins will almost certainly be at Northumbrian Water for some time.

To learn more about the developing enterprise use case for the Internet of Things, come along to our Internet of Things Business Summit on 12 May 2016. Attendance is free to qualifying IT professionals