As the drought in mainland south eastern Australia intensifies and water storage levels continue to fall[1] water businesses are scaling up investments in innovation to bolster water supplies. Particularly in states along the east coast being hardest hit, MHC is seeing a sharper focus on investments like digital technology to reduce non-revenue water and increased efforts on customer engagement to save water. While traditionally the forces behind investments like these were cost saving related, we are observing water security now being a major (if not the primary) driver.
This is, of course, a natural human reaction. As human beings we are hard wired to survive and we’ve evolved responses to threats to our existence. So when there is a threat to such a critical human need as water, it’s natural for our survival instincts to kick-in – we get innovative and we take action. With desperation comes innovation.
However, there is a problem with such an approach in our industry today and it’s to do with lead times. Decisions to investment in water security in the midst of drought often take years for benefits to be realised – often extending well beyond the period of drought and likely to only draw criticism on the rationale for the original investment.
According to Dr Jonathan Dixon, a Principal Analyst at Sydney Water: “The long term thinking isn’t what we naturally do. However, regardless of drought, as water use keeps increasing with population growth we will need to find water efficiencies. So, if you have water efficiency programs running at all times you’re not just prepared for the next drought. You’re also getting efficiencies at other times by minimising the impact of a growing population.”
So innovation shouldn’t be something done only in times of need. It makes sense for it to be embedded as a business-as-usual culture, so investments can be made to suit future planning and smooth impacts on stakeholders, not only when times are bad and when the benefits are desperately needed. And the business can still benefit when times are good.
While that all sounds straight forward, putting this into practice is a different story. Because who is going to be brave enough to risk flack from government, industry peers, customers and media for investing in water security when dam levels are up at 80%-90% levels, nothing like the 40%-50% levels we are currently experiencing in major cities?[2] And perhaps where the most courage is required, who is going to argue to government and economic regulators to increase customer pricing to pay for these investment when likely community perception is that they are not needed? It will be only the bravest of leaders who pursue those investments during times of low need – especially when those leaders may not be in a position of control when the benefits are truly needed.
Isle Utilities, MHC’s new merged partner and innovation and technology specialist, has been supporting water utilities for several years to create innovation cultures and, at the very minimum, ensure innovation is a business-as-usual activity. According to Dr Michael Storey, Asia Pacific MD for Isle Utilities, “Understanding the institutional and cultural barriers is just as important as the technical barriers. Successful innovation cultures depend on three elements:
- Strategic alignment. There needs to be strong emphasis on how innovation is helping the utility achieve its corporate vision and mission.
- Leadership buy-in. Innovation like any culture is leader-led and starts from the top. That includes committed human and financial resources.
- Permission to fail. Innovation comes with a level of uncertainty and technical complexity, so utilities need to change their appetite to risk and uncertainty. If we knew all the answers then it wouldn’t be research or innovation.”
There is no question that some of mankind’s most innovative periods have arisen during periods of desperation – natural disasters, world wars and other unforeseen events. However, in an industry where being proactive rather than reactive is increasingly the focus, embedding a culture where we are always innovating is essential. For that we may need to go against our natural instincts.
[1] Australian Bureau of Meteorology http://www.bom.gov.au/climate/drought/#tabs=Drought
[2] Australian Bureau of Meteorology http://www.bom.gov.au/water/dashboards/#/water-storages/summary/state
