Utilities CEOs step up investments to achieve growth. | KPMG | GLOBAL

Power & Utilities CEOs will invest in Cognitive Technology and Data Analytics to achieve growth: KPMG Survey

Utilities CEOs step up investments to achieve growth.

Despite commitment to emerging technologies, CEOs are concerned that implementation will create challenges.

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Amid a rapidly evolving landscape of changing customer dynamics, unprecedented growth of renewables, and tech-driven business model disruptors, global power and utility CEOs are bullish on growth, and are increasing investment in emerging technology to pave the way, according to the 2017 Global KPMG CEO Outlook.

“Utilities across the globe are feeling the effects of disruptors. From consumers demanding more, to the effects of policy and regulatory changes, to advancements in smart technology influencing energy infrastructure, the utility industry continues to face pressure to reinvent itself. The savvy CEOs are embracing technology to drive innovation within their company cultures and become the utility of the future,” said Regina Mayor, Global Energy and Natural Resources Leader, KPMG in the US.

In the KPMG study of 74 global power and utility CEOs, 88 percent say they are confident they will see their company grow over the next 12 months; 86 percent are confident they’ll see growth over a 3-year period.

To achieve this growth:

  • Eighty-nine percent of CEOs plan to invest in data and analytics tools, followed by cognitive automation (77 percent), and IoT (76 percent). 
  • Seventy-seven percent say these investments will primarily focus on regulatory compliance, 66 percent point to physical infrastructure, and 62 percent say innovation of new products and services.
  • The CEOs’ priority objectives for these investments are to achieve bottom-line growth, increase productivity, and bring their organization closer to the customer.

Despite a clear commitment to investing in emerging technologies, utility CEOs are concerned that implementation will create challenges. In fact, piloting emerging technology was the number one technology-related challenge CEOs are concerned with, followed by integrating cognitive technology and optimal use of analytics. Additionally, the top three risks utility CEOs are concerned about are those associated with operations, strategy and emerging technology.

“Cognitive technologies and robotic process automation are changing the way we do business,” said Michael Salcher, Global Power and Utilities Leader, KPMG in Germany. “While there may be implementation challenges along the way, the benefits of a digital labor workforce are becoming clearer. Organizations must challenge themselves to be innovative and capitalize on opportunities to adopt these smart technologies to remain competitive.”

For more information, please visit the KPMG 2017 CEO Outlook landing page.

About KPMG's 2017 Global CEO Outlook survey

The survey covers 1,261 CEOs in 10 key markets (Australia, China, France, Germany, India, Italy, Japan, Spain, UK and US) and 11 key industry sectors (automotive, banking, infrastructure, insurance, investment management, life sciences, manufacturing, retail/consumer markets, technology, energy/utilities and telecom). A third of the companies surveyed have more than US$10B in annual revenue, with no responses from companies under US$500M. The survey was conducted between 21 February and 11 April 2017. NOTE: some figures may not add up to 100 percent due to rounding.

About KPMG International

KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 152 countries and have 189,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

For further information, contact:

Megan Dubrowski
KPMG LLP
201-307-8237
mdubrowski@kpmg.com
Twitter: @meg_dub

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