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How Data Ecosystems Drive Operational Excellence in Power Generation

How a cohesive data ecosystem empowers operational excellence for power and utilities

For the power and utility sector, operational excellence allows every member of a plant to visualize how workflows operate to produce optimal output. Doing so enables all personnel to identify issues that could lead to an unsafe condition and/or a plant shutdown. Reduce the risk of security threats and create a safer, more reliable and more resilient facility.

From the executive suite to the plant floor, facilities can establish a data ecosystem that connects an organization. This cohesiveness allows plant floor employees to identify areas where efficiencies could be improved, therefore, illuminating the path along the operational excellence journey. A plant floor employee can identify areas of immediate concern while management focuses on developing a long-term strategy with measurable enhancements that enable competitiveness in the market and long-term sustainability.

When creating a data ecosystem, plants must focus on equipping the facility as a whole rather than segmented parts. The 2021/2022 Global State of Operational Excellence report from the Business Transformation & Operational Excellence World Summit (BTOES) conveys that the most pressing operational excellence-focused challenge that leaders in the energy sector face is a need for end-to-end business transformation. To overcome this challenge, plant leaders must adopt a continuous improvement strategy and culture that leverages digital solutions to establish an integrated data ecosystem.

Streamline Process With Digitalization

While most industries are accelerating their digital transformation , the power generation sector's shift to a digital mindset has been substantial. Complex changes within the last 20 years have created a need for the power generation industry stakeholders — from floor managers to C-level leadership — to adopt integrated digital solutions that empower more streamlined and cohesive information for plant operations decisions.

One of the mistakes currently seen throughout the industry is to implement a strategy solely focused on cutting costs in an effort to improve the near-term balance sheet. McKinsey & Company reports that 40% of transformation value stems from growth initiatives while reducing costs accounts for only 9% of transformation value. Thus, plant operators and managers must discern how to increase sustainability without reducing general overhead expenditures. That's where digital transformation comes in.

Digitalizing Enhances Operational Efficiency

Digital tools have the power to change the plant culture, streamline operations and create a more sustainable, safe and efficient power plant. This type of process excellence is achieved through:

  • improving the process flow,
  • automating data gathering, reporting and refining,
  • standardizing procedures,
  • reducing nuisance alarms and improving situational awareness,
  • consolidating data in a central location,
  • providing data to teams to continually improve operational procedures

By leveraging these digitalization solutions (a digitalization strategy), power plants can assemble a truly connected worker. The connected worker strategy permits the plant to fine-tune its operations through identifying areas for continuous improvement in order to meet sustainability goals. The ongoing improvement enables power plants to become safer and leaner, thus accelerating their journey toward operational excellence.

Cultivate a Culture of Technology Adoption

Operational excellence is not a skill; it is a journey that has to include changing plant culture. Therefore, to achieve operational excellence in power generation and increase the bottom line, culture must be addressed via a recognized Change Management process.

To ensure digital transformation success, power plants must adopt an all-hands culture of lean thinking and continuous improvement that encompasses two critical elements:

  1. Digital-first mindset: Employees must be open to learning, and ultimately adopting, new technology, understand the value that it will bring to the organization and how it fits in with the facility improvement strategy.
  2. Digital literacy: Everyone in the organization must understand how to utilize the tools to maximize efficiency. This isn't accomplished by the vendor's training program, but rather by identifying and empowering superusers and change champions.

By achieving this cultural shift, the workforce will have the capabilities to take ownership of managing processes, procedures and continuous improvement activities.

Digital Tools in Action: Calpine Corporation

Calpine Corporation, America's most notable generator of electricity, sought to utilize digital technology to generate power in a low-carbon and environmentally responsible manner. Calpine intended to leverage digital solutions to record processes that would drive more efficient shift handovers. Additionally, the plant wanted this data to be readily accessible across its facilities and corporate offices.

Calpine integrated digital software to replace manual reporting methods with more agile and streamlined tactics. By leveraging the right technology, Calpine created a central data repository. All necessary personnel could access the data and analyze it to look for improvement opportunities across operations while bolstering digitalization efforts to move the plant toward operational excellence.

Digitalization Drives OpEx

At a high level, digitalization allows power plants to streamline communication to drive operational efficiency. This is achieved through:

  • building lean end-to-end value streams that facilitate the creation of efficient workflows,
  • executing a workflow that results in being able to visualize problems,
  • establishing cohesive processes and plant procedures that an employee can easily adopt,
  • enabling all plant employees to access key processes, procedures, permits and other required documents,
  • highlighting potential issues within a process flow, such as security threats, or areas in need of productivity enhancements

Examples of data and technology working together to create a more sustainable plant include:

  • performing nightly autonomous scans of daily work areas,
  • automatic scan processing by artificial intelligence engines to monitor energy outputs and deliver insights to management

Ultimately, these types of digital solutions work together to:

  • merge human elements with autonomy,
  • eliminate energy waste,
  • prevent safety incidents,
  • stimulate automation across all areas of the plant

At the plant floor level, new technologies and digital solutions can solve specific challenges that plant owners, managers, operators, HSE and IT personnel encounter.

Increase Plant Productivity and Cost-efficiency

Technology makes workflows and processes visible. For example, certain types of digital twins have the capability to leverage artificial intelligence, predictive and prescriptive analytics, and machine learning to devise a digital ecosystem where plant owners and operators can view data and transform it into action items to facilitate operational improvement. The result is process improvement, which creates more productive, sustainable and cost-efficient power plant operations.

Connect Workers Through More Cohesive, Streamlined Processes

At its core, operational excellence increases value by allowing plant personnel to be more productive with their time. Digital ecosystems enable power plants to consolidate data, automate standard work and standardize processes to increase worker efficiency. A suite of digitalization tools helps achieve this by:

  • reducing nuisance alarms,
  • improving shift handovers,
  • standardizing and streamlining the permitting process,
  • enhancing situational awareness,
  • compiling data sources,
  • automating data gathering and reporting,
  • digitizing safety-critical operational work processes

The result is connected power plant workers coming together to create a leaner, safer and more profitable facility.

Address Emergencies or Abnormalities Without Disrupting Operations

It's not a matter of if an incident will occur — it's a matter of when. By having the right digital tools in place, organizations can take the first step in creating high-performance work teams that harvest the necessary data — think Six Sigma — to perform incent investigations that mitigate the problem once and for all.

A digital backbone ensures operations can perform multiple functions and is vital in preventing plant shutdowns and reducing safety and environmental hazards. While additional risks may still occur and particular circumstances warrant a shutdown, a comprehensive data ecosystem helps organizations visualize data to make predictions, evaluate areas of improvement and make changes to processes. Digitalization ensures that when emergencies occur, your plant will handle them without disrupting operations or putting the environment or safety at risk.

By consolidating data and making it readily accessible for maintenance and reliability engineers, plants can develop improvement plans. Enhanced processes deliver resilient operations that keep the plant on track to achieve its goals. Technological assets help employees identify and resolve abnormalities while preventing safety and environmental threats.

Assure Sustainable Progress for the Plant

A 2020 study on operational excellence and its connection to resilience produced by Sustainability concluded that there is a positive correlation between operational excellence and sustainable development, specifically in regard to lean management. The guiding principles of operational excellence strive to improve performance and employee productivity across an organization, which results in more resilient, autonomous and cost-effective operations.

For example, field operators can use digital software to streamline maintenance requests and operational work instructions. In doing so, they enable lean manufacturing that allows operators to shift their focus from navigating inefficient, paper-based systems to improving the efficiency of their field workers. The result is a more sustainable and resilient power plant.

Action Items To Execute Operational Excellence for Power and Utilities

To begin the journey toward operational excellence, plant management must create a plan of action for continuous improvement: Define a strategy and path, identify quick wins and look for low-hanging fruit where digitalization will expedite the return on investment (ROI).

 Digitize Wherever Possible

Digital transformation, when implemented properly, facilitates an organization to adopt technology that create leaner, more efficient operations. However, before that can happen, plant leadership must first perform a tech gap analysis to determine which processes, procedures or permits could benefit from digitalization to increase ROI.

For instance, by digitizing paper-based data collection and storage, employees can keep safety-critical assets in digital, secure spaces that are accessible to those who need them. By using the right software, organizations can reference or utilize these assets quicker, giving them more time to devote to improving operational efficiencies and overseeing other procedures.

Establish a Cohesive Data Network

Once plant leaders identify which business processes need to be digitalized, they can then determine how to connect these digital assets to produce a cohesive ecosystem. Creating a connected workforce involves digitally linking all processes and procedures; digital tools like alarms, control loops, IPLs, and process and operating limits can be connected to operational management solutions to increase visibility across the plant to create an interconnected workforce. With operational data readily available, users can visualize end-to-end processes and find the information they need in a central location.

A data cohesive network results in a digitally connected plant where personnel with a need for the information across the organization have access to process data. This improves efficiency, decreases operational risk and affirms internal and external compliance regulations are met.

Ensure Security

If not identified and rectified quickly, cyber threats put plant operations at risk and can lead to a plant shutdown. Thus, plant leaders and IT managers must continuously assess their operations for cyber threats, which can be accomplished through digitalization. A visual flow of operations makes these cyber threats more visible, empowering operators to create solutions that enhance security and safeguard the plant's operations.

Metrics for Measuring the Impact of Operational Excellence Strategies

Adopting new technologies that integrate with plant operations allows management teams to connect existing systems, support scalability and ensure sustainability. However, every plant requires a unique approach to adopting and incorporating digital solutions into its workflow — there is no one-size-fits-all path to achieving operational excellence. These are quantitative and qualitative tools that plants can utilize to gather and measure metrics to ensure they are propelling toward operational excellence.

Operational key performance indicators (KPIs) are quantitative metrics for determining the impact of operational excellence strategies. They measure against benchmarks to help organizations track operational processes. Organizations can evaluate progress against objectives and key results (OKRs) along with KPIs to identify areas that need optimizing, then implement continuous improvement strategies to accelerate operational excellence across the plant. Examples of these types of quantitative KPIs include energy consumption rates, production costs and performance ratios.

Qualitative metrics provide conceptual insights into the quality of which a plant operates. Leadership teams use these insights to identify vulnerabilities and make enhancements to workflow, operations and/or processes to determine areas for improvement.  

For example, a 2020 study by the University of Bergen investigated the use of digital twin technology by high-reliability organizations. It found that the implementation of digital twins led plant personnel to compare and question workflows and visualize how new tools could fit into their existing methodology while ensuring complete safety and efficacies.

Digital Twin Use Cases: Employing Digital Solutions To Enhance Power Safety Processes

Given the example of digital twins, data ecosystems serve as the backbone of their strategy and extend operational efficiency across the power plant. A power company can create a replica of their plant that can be accessed securely anywhere, any time and by approved personnel.

As shown in this webinar on achieving autonomy in industrial facilities and manufacturing , when a plant can reduce the need for people to travel to facilitate a safety evaluation, they mitigate the risk of safety and security issues. Using digital twin technology when planning an inspection can decrease the number of people who have to go into the field to visit critical safety areas of a plant. The user can input a specific tag to generate a digital representation of the area they need to analyze, as well as view all corresponding documents, information maps and other assets. The result is seamless, consolidated navigation that allows plants to optimize their safety while simultaneously reducing operational risk.

Make the Most Out of Your Organization's Digital Investment

By harnessing the power that digital solutions deliver, organizations can create more efficient, sustainable and secure operations. From simulating real-world scenarios to automating digital processes, power and utility operational excellence involves integrating the physical world with the digital. The result is a cohesive digital ecosystem that management can depend on to inspire continuous improvements across facilities to achieve operational goals.

Above all, leadership must recognize and understand that operational excellence is a unique journey. Rather than relying on a one-size-fits-all blueprint, operators and managers must educate team members and integrate the right digital solutions into their business process. Only then will power companies be able to embrace lean methodology and drive toward operational excellence.

Contact Hexagon to discover more on the impact of operational excellence for the power and utility sector and how organizations can use technological advancements to maximize their operations.  

Check out Hexagon's latest content on the power of digital transformation . Whether you need to digitalize safety-critical human operations, processes and procedures, optimize alarm management, protect your investment with state-of-the-art cybersecurity or build a comprehensive digital twin, we are here to support your digital transformation journey and to help you prepare for tomorrow, today. And if you would like to better understand where your organization's digital maturity stands, our Operations Management Gap Analysis Survey is a valuable tool to help you get started.


About the Author

Bob Hooper is a senior industry consultant at Hexagon with a successful track record in the development and implementation of operational excellence, lean manufacturing and reliability programs within the oil and gas, chemicals and consumer products industries. His areas of expertise include program management and change management, and he specializes in helping customers understand the intricacies and applications of a variety of digital technologies.

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