“Gut to Data”

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A few weeks ago, I was loaned a phrase by a new friend of mine that will become a mainstay for how I describe the aging workforce in the energy sector: “gut to data.”

It perfectly captures what’s going on at the ground-level in the industry and explains the goal of efficiency without being threatening.

The last part of that clause is important — “without being threatening.”  For many, especially those who haven’t been surrounded by technology their entire lives, software equals replacement and their intuition is the original form of proprietary data.

As a result, buy-in at the individual level becomes crucial to the success of any new software implementation — something I’ve written about here.

According to a January 2017 assessment by the Department of Energy, 25% of US employees in electric and natural gas utilities will be ready to retire within 5 years.  The Department of Labor also estimates that up to half of the current energy industry workforce will retire within the next 10 years; meanwhile, the average age of industry employees is now over 50.

As high levels of retirees take with them industry experience, it will be crucial for utilities of all sizes to conduct a massive transfer of industry knowledge to new employees or servers. This isn’t news to anyone in the sector.

These changes could potentially create skills gaps for the industry’s workforce, which is compounded by existing recruiting challenges in attracting appropriately trained and qualified employees.

This shift is something I’ve thought about but never in a codified way. Rather than trying to value one over the other, I wanted to think about a process that turns intuition into data without being threatening to employees and still improves decision-making when combined with today’s technology. This approach gives the best of both worlds, here’s how it could work:

  1. Utilities shouldn’t pit intuition against data: Intuition and big data can exist together, especially if utilities actively create teams that combine people from different schools of thought.
  2. Intuition is the “gut check” to new potential insights: Data analysis can bring new issues to the forefront or provide context for existing problems. Intuition helps gauge if those discoveries make sense.
  3. Experience still matters: Cultivating intuition means the ability to detect patterns and connect data in ways that can be a huge competitive advantage. Data can check these hypotheses providing hard evidence when intuition uncovers new ideas.
  4. The data and knowledge are accessible and transferable – Employees must be able to access data quickly and easily in ways that make sense. More than ever, departments like marketing, customer service, and operations should be able to share knowledge in ways that increase customer satisfaction.

Big data is here to stay and will continue to play a growing role in the power sector. As the workforce turnover accelerates, it will be important to balance experience with data and realize each method brings unique perspectives that can be valuable tools in decision making.

Kevin Stevens

Partner @ Intelis Capital investing in the digitization of traditional industries. Previously product lead at KPCB-backed Choose Energy.
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