The case explains and discusses how Brown wanted to put emphasis on process orientation because the ” functional model had run out in Corporate America” and according to Brown, ” the only reasonable approach to business transformation is process alignment and service orientation. ” (Aragua, 2010). However he was unable to push for more when found his information services organization lacked the necessary formal processes and was so strongly dependent on people knowing which person needed to be contacted to get the job done.
After using a functional model within the company and having over 50 years of IT experience, he now faced the challenge of needing to push for a change from a functional model to a process model. To help rectify this sue Brown began to implement a process discipline into the IT organization, however this lead to also trying to fix the major gap between IT people and Business people within the company.
Brown’s push for a process orientation based organization was driven by his “conviction that the functional model had run its course in Corporate America” (Page 3) and he believed ‘the only reasonable approach to business transformation is process alignment and service orientation” (Page 3) Brown realized if one part of the company could accept and achieve a process-oriented approach so could the other parts f a company, to help him initiate his goals he created a “Center for Process Excellence (COPE) within his unit, which would act as an internal consulting organization to other business units in their process improvement efforts.
One of the most successful engagements of this team was its work with the sub-station maintenance group that eventually culminated in the TAN [Transformer Oil Analysis and Notification] project. ” (Page 1) Furthermore Arizona Public Service (APS), Pinnacle West’s largest subsidiary and co-owner/operator of Palo Verve Nuclear Power Generating Station.
Served more than one million customers within the Arizona population, with the utility industry growing it was projected that there would be a “60 percent increase in customer peak demand by 2025” (Page 2) in order for them to meet the expected demand “APS identified several key initiatives including increasing energy efficiency, doubling renewable energy production and adding additional nuclear power capacity. ” (Page 2) given PAP’S environmental concerns, APS had to be continuously improving their ability of generating and distributing power.
To meet these needs APS would need o upgrade old disruption infrastructure with power grids and install “smart” meters, these upgrades and the regulated price market would challenge APS to keep up with the changing commodity price and the increasing fuel cost. Brown knew that in order for the company to continue through these challenges and changes, APS would need efficiency improvements and cost saving operations through innovation. ENTERPRISE CAPABILITIES Evaluating a company’s enterprise capabilities allows you to determine if the company can support a processed-bases transformation in respect to the company’s senior executives.
The capabilities consist of four categories (Leadership, Culture, Expertise and, Governance) and thirteen subcategories (Awareness, Alignment, Behavior, Style, Teamwork, Customer Focus, Responsibility, Attitude Toward Change, People, Methodology, Process Model, Accountability and, Integration) 1. 1 LEADERSHIP A company’s leadership refers to the senior executives supporting the creation and change of processes within the company. Following Poem’s subcategories for leadership (Awareness, Alignment, Behavior and, Style) Pinnacle West can be assessed as an E-4.
Pinnacle West scored an E-4 in leadership in all four observatories because of Brown’s ability to implement those changes that brought progress to the company. Brown was also keen on setting up the implementation in Pinnacle West. 1. 2 CULTURE The culture within a company involves the values the company has on customer focus, teamwork, personal accountability and the willingness to change. The subcategories of culture (Teamwork, Customer Focus, Responsibility and, Attitude Toward Change) reveal that Pinnacle West can be evaluated as an E-3. . 3 EXPERTISE A company’s expertise is its ability, skills, and methodology for the redesign of a process. Poem’s subcategories for expertise (People and, Methodology) scores Pinnacle West as an E-4. In implementing the new changes to the process, Pinnacle West brought in the Center for Process Excellence (COPE). Brown’s COPE implementation will award Pinnacle West an easy E-4. 1. 4 GOVERNANCE The governance of company includes the mechanisms for managing projects and change initiatives.
The subcategories of governance (Process Model, Accountability and, Integration) reveal that Pinnacle can be evaluated as an E-3. The company is still running behind on this category due to lack of inadequate immunization in the past before the changes by Brown. PROCESS ENABLERS Evaluating a company’s process enablers allows you to determine the maturity of the business’ processes and how to enhance or improve aspects of these processes with respect to the company’s employees and managers.
The enablers include five categories (Design, Performers, Owner, Infrastructure and, Metrics) and thirteen subcategories (Purpose, Context, Documentation, Knowledge, Skills, Behavior, Identity, Activities, Authority, Information Systems, Human Recourses Systems, Definition and, Uses) 2. 1 DESIGN A company’s design refers to the comprehensiveness of how the new process is executed. Following Poem’s subcategories for design (Purpose, Context and, Documentation) Pinnacle West can be assessed as P-4.
The company implemented the Center for Process Excellence (COPE), which will work as internal consulting organization to other business units in their process improvement efforts. 2. 2 PERFORMERS The performers within a company refer to the people (employees, managers, supervisors, etc. ) who execute and perform the process based of their skills and knowledge of the process. The subcategories of performers (Knowledge, Skills and, Behavior) reveal that Pinnacle West can be evaluated as P-3. 2. OWNERS The owners of a company are the senior executive, who supports and is held responsible for the processes success or failure. The subcategories of owners (Identity, Activities and, Authority) reveal that Pinnacle West can be scored as 2. 4 INFRASTRUCTURE A company’s infrastructure is the information and management systems that support the process. Poem’s subcategories for infrastructure (Information Systems and, Human Recourses Systems) scores Pinnacle West as a P-4. . 5 METRICS The metrics of a company is how the company keeps track of the process’s performance and measures its success.
The subcategories of metrics (Definition and, Uses) show that Pinnacle West is evaluated as P-3. The company’s goals are not as clear but the new-implemented process would help clarify the situation. Grassroots Strategy at Pinnacle West Pinnacle West implemented a grassroots strategy is one that is driven from the bottom-up when trying to initiate a change from a functional model to a process model. “The only reasonable approach to business transformation is process alignment and service orientation. (Page 3) this approach is a grassroots strategy it starts at the front lines, the employees who interact with the customers. This strategy allowed for reorganization and alignment with the process change initiative and redesigned the maintenance process at APS; the Work Control (Planning and Scheduling), the Work Execution (Actually performing the job), and Work Closeout (reporting that the job has been completed and checked) All three of these steps in the APS new maintenance process allows for continuous feedback, from the front line workers.
At the beginning planners loud complete five to eight work packages a month, but with the redesigning of the maintenance team and the continuous feedback surveys, they could create and plan up to one hundred work packages a month. Furthermore to ensure quality of the job “each work order was assigned a dedicated caseworker who retained ownership for the order from beginning to end. ” (Page 7) According to the COPE, teams were created tap help increase efficiency within the organization.
The development of the COPE has reinvented the process improvement. The role of implementing the COPE was to provide facilitation and redesign services wrought the enterprise. COPE had engaged business units in the IT centric projects, informed their clients and then followed up on their service. Brown and his diversified and qualified group had the view point of: ‘first understand business and then get technology involved. “(Argue, 201 2) the procedure went through the supplier-input-process-output-customer chain.
The role of implementation by COPE group guided the organization towards automation, empowered workers, trust between teams, company savings, innovations, and awards. The strategy set forth proved itself within two short years and would me very plausible to be sustainable into the future. Does The Grassroots Strategy Have Sustainability? The Grassroots strategy is sustainable for Pinnacle West for the most part; however parts of the organization are more centrally focused.
COPE established a grassroots-based enterprise for Pinnacle West, This strategy allowed for the company to be upgraded to a ‘Column 1’ which is the least regulated category under the Nuclear Regulatory Commission (NRC), ‘The NRC said that the plant’s upgrading from the most-regulated ‘Column 4’ category, which is one step away room a forced shutdown” (Page 10) not only was the grassroots strategy sustainable but helped to save the company’s plants at Palo Verve.
Spec’s efforts were recognized to help the infrastructure strategy “by championing the use of an enterprise modeling tool and training site programs in mapping and facilitation techniques. COPE training materials were adapted to the Palo Verve context, Palo Verve was also able to benchmark its processes against another nuclear power plant though the help of COPE. ” (Page 10) As Pinnacle West continues into the future Brown acknowledges that next steps to a process- oriented organization is to work on the nature of the interaction between IT people and Business people.
Brown summarized his next opportunity and challenge for the information services; ‘We become the Google of energy. The business model is therefore going to change. Distributed generation and renewable generation are coming to the forefront… All of these are colliding like a perfect storm. That begs a different view from the IT standpoint. We have an early start – but the key is going to be integrating the backbend into the normal day to day operations. (Page 10) This would lead the reader to interpret this roosts strategy to be sustainable in the next 2 to 3 years, the company and Brown being aware of the challenges ahead as stated gives them an early start, to accomplishing their sustainability in the future. The Top-Down Agenda at Pinnacle West While COPE established a more grassroots-based effort, when the company was in category 4 of NRC they realized if they continued doing what they were doing they would be very quickly shut down. “Part of the problem was the complexity of our process. As a result, the site as a whole got behind the process improvements efforts.
It helped us to drive process change from the top down. The senior VSP fully supported our efforts. ” (Page 9) while the top-down agenda dose work Brown should have been more aggressive in pushing his agenda throughout the enterprise, rather than creating a burning platform from the top down to set his agenda into action. Pap’s power generation and distribution capabilities were not reliable and required continuous improvement, if Brown had been more aggressive this problem and many others could have been addressed quicker and more efficiently. Conclusion In conclusion, Pinnacle West Capital Corporation (PIN) with the help of Mr..
Denny Brown Chief Information Officer (CIO) and Vice-President realized there was a need to switch from a functional model to a process model. Brown and the company addressed theses Challenges by facing the requirements for implement an effective process at Pinnacle West, by the transformation of the organization with the catalyst of a “Burning Platform”, being quite literally a fire, and the Grassroots strategy sustainability in the company, and finally the Top-Down agenda throughout the enterprise. While the agenda worked Brown should have been more aggressive in the implementation of the changes.
