Rahul Poruthoor Ignatious

0063532

Assignment 1:Research Project

Objective

Learning the process of operational analytics by considering the examples of General

Electronic's Predix software system and Siemens' AMI analytics.

Operational Analytics

Operational Analytics, defined as analytics that improves the efficiency or effectiveness of a

business process. By utilizing data mining tools, businesses gain transparency into their

operations and make better decisions. The key is to have access to real-time data and complete

transparency in business processes and customer behaviors. It is only with the most up-to-date

information that businesses can see specifically how their day-to-day operations function and

then make the appropriate adjustments to improve the bottom line and customer satisfaction

("Operational Analytics").

Advantages of Operational Analytics

Increased profits

Operational analytics help the company to pinpoint the inefficiencies in the system and verify

those thereby reducing maintenance and operational expense. This, in turn, reduces the overall

cost and thereby increase the profit margin(Johnson, Potreck, Seifert, & Nagao, 2013), (Whitten

& Bentley, 2007).

 Better decision making

Replacing high-end consultancies for opinions on business strategy with information derived

from data analytics of operations. This is more cost-effective and provides better insights to take

important strategic decisions (Winig, 2016), (Johnson, Potreck, Seifert, & Nagao, 2013)

(Whitten & Bentley, 2007).

Customer satisfaction

The operational analysis helps the company to increase customer satisfaction. Operational

analytics help the company to identify the exact issues in no time, thereby reducing the time to

fix the issues. This on the top savings also makes customers happy (Winig, 2016), (Johnson,

Potreck, Seifert, & Nagao, 2013).

Competitive advantage

Considering operational data on the top of consumer data give high-quality insights to the

company, thereby having a competitive advantage over competitors. This competitive advantage

comes mainly in the form of customer satisfaction and cost reduction (Winig, 2016), (Whitten &

Bentley, 2007).

Holistic operations

Operational analytics allow you to get a holistic view of your data, where you discover certain

networks that are interrelated with each other. When you realize that certain types of data are

dependent on a specific environment, you can perform a more efficient root-cause analysis and

helps to prevent the issue from reoccurring ("Top 7 Benefits of Operational Analytics", 2019).
 Disadvantages

Radical change

Some companies adopting operational analytics were the ones that were solely dealing with

physical entities, for example, in the case of GE they were the manufacturer of industrial

machines and spare parts. The company does not have much experience in the Information

Technology space. This transformation is time-consuming and complicated (Winig, 2016).

Restriction to data

Data belonging to the consumers and other stakeholders needed for analysis may not be available

as the company need. In the case of the GE Predix software system, they access data related to

machines and part for which they are not original equipment manufacturers to make the overall

process more efficient. Not all customers or manufacturers may allow that even though there

might be incentives or advantages in it for them too (Winig, 2016).

Long term capital investments

Data analytics requires sophisticated technological assets such as servers, scanners, data centers

and a lot of recruits who are expert level professionals in the field. Even after such huge

investments, the results may not be visible within a short period. It might sometimes take a few

years for visible changes (Whitten & Bentley, 2007).

Lack of cooperation from the employees and managers

Sometimes there may be significant pressure to reduce the scale of application of data analytics

in the operations. This may be due to visible changes in the processes because of the application

of the new system. Automation of certain critical processes also adds to the resistance. The

managers who are new to technology and changes may be against this system and may not

cooperate fully (Whitten & Bentley, 2007)...

General Electric's Predix system

Predix software system allows General Electric Company to help it's customers to track the

machines and operational processes in their production units and access their shortcomings.

After proper analysis of the information, Predix can come to valuable conclusions that can act as

solutions to many performances and efficiency-related problems. This can help the users to save

a significant amount of money in maintenance costs and reduce large investments in buying new

machines. Predix can also provide new opportunities for users in increasing their production

efficiency. In the case of the oil industry, the application of operational analytics can help the oil

extraction companies to increase their limit of extraction from a single oil well for which the

economical limit is normally 35%. This increase in output even as low as 1% on a global scale

will be 80 billion barrels that are 3 years of global supply. Analytics also helps to predict the

chance for downtimes that can save LNG platforms and offshore facilities a lot of money (Winig,

2016).

One of the major problems faced by GE in implementing analytics in the oil industry is its

limited capacity to replace the years of experience of the ageing workforce. A large portion of

the oil and gas workforce — by some estimates as much as 50% — will be retiring by 2025,
taking years and even decades of domain knowledge with them. New engineers expect cutting

edge technology in the workplace to support them. This is where Predix comes into play.

Another problem is the oil industry's resistance to adopting new technology. A related problem is

the engineers' distrust in the data. GE had well-analysis software that could determine if a pump

was operating at its optimal range and adjust its speed to run faster or slower to optimize

production. Despite several case studies and a pilot on 30 wells showing an incremental gain of 1

million barrels of oil over two years, GE's customers will not allow the software to change pump

speeds on its own (Winig, 2016).

The process of application of the Predix system

Collecting Data from the sensors installed in the machines both made
1 by GE and others in the production units.

Storing the data at data centers with high end security measures for
2 present and future use.

Analyzing the data by using Predix software system.

3

Comparing the performance of different machines and identify what

4 makes one perform better than other.

Identifying patterns that gives the technicians the solution for increased
5 performance.

Using information derived from the above analysis to predict future

6 maintenance requirements and their appropriate schedules.
 Siemens’ Smart Meter Analysis using AMI

Advanced metering Infrastructure or smart meters are planted on the property of every customer.

Data collected in the smart meters are analyzed to derive useful information for utilities

(Johnson, Potreck, Seifert, & Nagao, 2013).

AMI analytics supports more accurate forecasting of system load and peak demand, which in

turn yields smarter procurement decisions. This is most important on heavy usage days such as

the Superbowl in the US. On such days more accurate forecasts can help utilities avoid spending

lots of extra money on the spot power market. Consistent access to timely, comprehensive and

reliable meter data increases certainty and thus reduces guesswork and risk in the wholesale

power market. This, in turn, gives power schedulers the confidence to enter into longer-term and

thus lower-cost wholesale power agreements (Johnson, Potreck, Seifert, & Nagao, 2013).

Analytics allows the utilities to balance the voltage served in the right amounts rather than

serving the high end of the recommended voltage to avoid voltage shortages. This results in

unwanted loss of energy. Conservation Voltage Reduction is the slight reduction of the voltage

served to customer loads, thereby saving energy without affecting performance. Those savings

can be significant: up to 3%, which exceeds the contribution of solar power to most utility's

generation portfolios (Johnson, Potreck, Seifert, & Nagao, 2013).

AMI analytics not only supports forecasting of customer loads but also provides a platform for

monitoring, analyzing and forecasting distributed generation and renewables. It doesn't matter

whether the source of distributed generation is a net-metered installation, a feed-in-tariff, or a

conventional independent power producer (IPP) (Johnson, Potreck, Seifert, & Nagao, 2013).
Analytics also can monitor brief momentary outages. These can indicate problems such as areas

where tree branches need trimming. Sometimes an individual customer (rather than several

customers) will report alone power outage. Before a repair representative is dispatched, the

utility can "ping" that customer's smart meter to check whether it's still receiving power. If so,

the cause is most likely a breaker or other electrical problem within the customer's building, and

not a problem the utility could fix. By this process, utilities can avoid truck rolls and help

customers solve power problems faster (Johnson, Potreck, Seifert, & Nagao, 2013).

Whenever there's a wider power outage, utilities must deploy several trucks. Analytics based on

the data from meters on both utility assets and customer premises can quickly reveal the likely

location of failed utility equipment (blown transformers, downed power lines, etc.) (Johnson,

Potreck, Seifert, & Nagao, 2013).

Transformer overloading occurs when demand for power downstream of a transformer

frequently and for extended duration approaches or exceeds the transformer's maximum capacity.

Today, AMI analytics can help identify which transformers experience overloading, to what

degree, and when. Analytics also can spot patterns and trends in downstream loads being served

by overloaded transformers. This makes it easier and more cost-effective to implement a variety

of solutions to minimize overloading and protect the utility's investment in that transformer

(Johnson, Potreck, Seifert, & Nagao, 2013).

Smart meters and analytics make it easier to integrate a utility's own renewable energy resources

onto a power grid since wind and solar energy tend to be intermittent and thus more complex to

manage. Analytics also make it easier to reliably manage peak demand, plan storage, thus
reducing the need to build conventional power plants which are intended mainly to deliver

peaking capacity (Johnson, Potreck, Seifert, & Nagao, 2013).

One of the many beneficial ways utilities can make use of AMI analytics is to keep an eye on the

performance and efficiency of AMI systems. Even during deployment, analytics can track field

operation progress (Johnson, Potreck, Seifert, & Nagao, 2013)

Advanced Metering Infrastructure Analytics

("Intelligent solutions for electricity utilities")

 Operational Analytics a boon for many companies

Indeed Operational Analytics is a boon for companies, especially in capital intensive industries

such as the Energy industry. From the above studies on the Predix software system and

Advanced Metering Infrastructure Analytics, it is clear that it is high time that companies should

consider and utilize the everlasting advantages of operational analytics. An Operational

Analytics system aggregates different pieces of data and analyzes them thereby deriving useful

insights for the company. Though there are considerable initial investments and high requirement

for cooperation from the part of various stakeholders, the long term benefits of operation

analytics is way beyond those sacrifices (Whitten & Bentley, 2007).

Even though the application of operational analytics systems helps the industry players to gain a

competitive advantage over others, it is always advisable to research and gradually adopt such

systems. Some systems may not be suitable for all kinds of companies. For example, it may not

be financially viable for some companies to invest hugely in infrastructure for analytics. For a

different company, the constraint may be different. Systems should be carefully designed; not

only considering the needs of the company, but also the constraints that surround the process

(Whitten & Bentley, 2007).

References

 Whitten, J. L., & Bentley, L. D. (2007). Systems Analysis and Design Methods (7th ed.).

McGraw-Hill.

 Winig, L. (2016, February). GE’s Big Bet on Data and Analytics. MIT Sloan Management

Review.
 Johnson, L., Potreck, L.-L., Seifert, D. P., & Nagao, S. (2013, January & updated on 2018,

September). Getting smart about smart meter analytics.

 Operational Analytics. (n.d.). Retrieved October 4, 2019, from

https://www.ngdata.com/dictionary/operational-analytics/

 *, N. (2019, January 3). Top 7 Benefits of Operational Analytics. Retrieved October 4, 2019,

from https://apiumhub.com/tech-blog-barcelona/7-benefits-operational-analytics/.

 "Intelligent solutions for electricity utilities" [Digital Image] (n.d.). Retrieved from

https://www.kamstrup.com/en-en/electricity-solutions/