Leaders in the industry emphasize a shift from traditional energy provision to a software-centric approach, leveraging AI for better asset management and risk mitigation​​​​. Just as a practical example, a solar and battery storage installation, users own consumption patterns, dynamic buy and sell prices, from the grid and weather create both a challenge and opportunity to optimise and maximise returns.

AI’s role is not just operational but also strategic, fostering innovation and operationalizing sustainability, as shown by AI’s application in remote asset inspections​​​​. McKinsey Using digital and AI to meet the energy sector’s net zero challenge Mckinsey July 18, 2023

The collective ambition of industry leaders and the innovative application of AI are steering the cleantech sector towards a greener, more sustainable future.

Accelerating Towards Net Zero

The surge of renewables is a testament to the evolving energy landscape, where green power is no longer the underdog but the leader in global energy sources. The energy crisis, exacerbated by geopolitical tensions, has galvanized an unparalleled shift towards renewables.

The International Energy Agency (IEA) projects an 85% acceleration in renewable capacity within five years, an uptick nearly 30% higher than previous forecasts​​. The acceleration of Solar post-2022 is especially evident in the above.

By 2025, renewables will overtake legacy energy sources as the primary electricity generator, expected to constitute 38% of the power mix by 2027​​. Solar PV will notably outshine coal’s installed capacity, reflecting an almost threefold increase, while wind power, especially offshore, is set to nearly double​​. This momentum could further amplify by 25% if policy, regulatory, and financial hurdles are navigated effectively, potentially closing the gap toward a net-zero pathway by 2050​​. The renewable energy revolution is underway, heralding a future of sustainability and resilience.

As always a portfolio approach is required for Net Zero solutions across :

Solar, wind, biogas/biofuel, waste to energy, hydro, cleaner nuclear, coal, and gas.

• Product and service portfolio management
• new product introduction
• demand review
• supply review
• financial appraisal
• Executive Review

The process involves creating consensus among different views that may be held by different departments or a handful of people in a smaller business. Connecting the dots between Demand and Supply to maximise Value is one of the most important activities in a business.

I often draw the analogy of the human body with a business. For example, an organisation may provide the skeleton, the allocation of resources to each part of the organisation provides the muscles. But its the nervous system and brain that provide the essential processes and communication much like the S&OP for demand and supply signals.

One of the key benefits of S&OP is improved forecast accuracy. By incorporating insights from different departments and external factors, S&OP allows businesses to make more accurate and reliable demand forecasts. This leads to better inventory management, reduced stockouts or overstocks, and lower carrying costs. The team agree and consistently applies a common approach to the qualification of sales opportunities on the demand side.

Furthermore, S&OP helps in managing risks and uncertainties. Businesses operate in volatile environments where demand fluctuation, supply chain disruptions, and market changes are common. The bullwhip effect in supply chains is a classic example when demand and supply are misinterpreted. Through regular review and adjustment of plans, S&OP allows organizations to respond to these changes promptly and effectively, thereby minimizing potential risks.

An effective S&OP process also ensures better customer service. Accurate forecasts and efficient operations mean that businesses are better able to meet customer demand promptly. It leads to higher order fulfilment rates and reduced lead times, ultimately enhancing customer satisfaction and loyalty.

Another critical benefit of S&OP is its positive impact on financial performance. By balancing demand and supply, optimising inventory levels, and improving operational efficiency, S&OP directly reduces costs and enhances profitability. Moreover, the process provides a clear view of the operational and financial plans, aiding in more accurate budgeting and financial forecasting. Essential for any meaningful conversations with funders and investors.

S&OP also promotes better communication and collaboration within the organisation. The regular meetings and reviews in the S&OP process foster dialogue between different departments, facilitating problem-solving and decision-making. This not only reduces internal conflicts but also enhances the agility and responsiveness of the organisation.

However, implementing S&OP is not without its challenges. It requires a shift from siloed departmental thinking to a more integrated approach, which demands strong leadership, clear communication, and a culture of collaboration. The use of right-sized S&OP software can also aid in streamlining the process, providing real-time data, and enabling advanced analytics.

The focus on the demand side of the business must not be underestimated. A critical success factor is putting in place “Leading Indicators” that provide early warning of demand issues. The obvious example would be the number and quality of sales prospects as an indicator of future sales.

In conclusion, Sales and Operations Planning is a strategic imperative in today’s business world. By providing a structured approach to coordinate demand and supply, it brings numerous benefits, including improved forecast accuracy, risk management, customer service, financial performance, and internal collaboration. Despite the challenges in implementation, the advantages of S&OP far outweigh the difficulties, making it a crucial investment for businesses seeking to thrive in an increasingly competitive environment whatever the size or sector of your business.

Contact me for a blueprint on implementing an effective S&OP process in your business.

Value Creation in 2 minutes

I was invited to meet with a group of entrepreneurs including WBS MBAs at an event at the Shaad London in February 2022 hosted by Warwick Business School. Focused group discussions around Consultancy in the afternoon – for me this was around Entrepreneurship and M&A the principal focus of my activities. But first, I had to provide a 2-minute pitch!
How do you put 30 years of starting recovering and building businesses into 2 minutes? Like many of us I have been searching for that Unifying Theory of Business success. This is what I said ……..

Your focus must be on the following :

Business Development –– its all about managing the depth and the momentum in the new business pipeline.

Strategy and Execution Problems and Solutions -its rarely just about strategy both on the problem side and solution!

Value Creation – its all about driving valuation! And simply put VALUE uplift comes from increasing future free cash flows while reducing required new investment and; Reducing RISKS that can threaten the cash flows.
Everything we do must positively impact Value Creation.
ALSO Think about disruptors as one of the main risks businesses face today.

This is a PEOPLE business -it’s all about the people not the spreadsheets.

If this simplicity resonates with you reach out to me for a discussion on networking and equitable deal structures.

#entrepreneurs#strategy#Warwickbusinessschool#businessacquisitions#SME#businessturnaround#businessstartups#businessInvesting#businessfunding

Building and maintaining strategic partners. Building and releasing value for SME business owners in the manufacturing and industrial service sectors.

Most businesses source products and services from suppliers and sell them to customers. We carefully select them, place orders, and pay for them. So why do the performance and the relationship sometimes deteriorate over time with these partners?

If we accept that in a world of limited resources relationships count then we would conclude we need to invest in this area.
What can happen with stretched resources on the buy-side is the only time you contact the supplier is when there is a problem and like any repeated behavior it eventually leaves a large negative psychological footprint.

A pragmatic solution I found to work in all businesses is to conduct regular Business Review Meetings BRM. These are just as relevant in start-ups, SMEs, and the smaller suppliers and customers in large businesses than just the top 10.
Structure BRMs around answering a couple of basic questions; What went well in the last period?
What did not go so well and how can we improve?
What does the next period look like and do we anticipate any problems we can mitigate?
This will unlock hidden value with your customers and suppliers that will propel your business forward. Invest in your key supplier and customer relationships.

Here is an article I recently wrote and was published

Here is an article I recently wrote for the publication EnergyEngineering looking at the increase in EV’s and their impact on the Electricity Grid.

Contact Energy Engineering directly for a hardcopy of their publication. Energy Engineering magazine provides a diverse and engaging mix of features written by industry professionals on a fast-moving industry that is significant from an engineering, environmental, and political perspective.

As an addendum to this article which underlines the rapid growth as important although the number of EVs compared to the total population is small. With disruptive technologies, especially around software and electronics, there is often a miscalculation of the speed of deployment and market share due to not recognising that the early-stage growth is in fact exponential and not liner. Remember Kodak and the assumption that digital cameras will grow according to linear extrapolation according to moore’s law (processor development).

One of my specialisms is in the area of energy technology and supporting companies successfully introduce new products and scale. Contact me further for a discussion

The article looks at the way technology advances are supporting businesses to have another level of interaction with their customers, which enhances their value proposition providing revenue opportunities.

Existing approaches with customers in a buy what we have model is the old way!

These are the four new connected sales and operations strategies : –

1. Fast with minimum friction response to desire. – Operations need processes that are fast with minimum customer friction throughout the process. Make it easy! Convenience beats loyalty in retail and reality. Amazon’s one-click strategy has proven this.

2. Curated offering – Developing the offering for a customer, providing options and advice based on the customer’s needs. For operations, the task is to understand the customers desired outcome and presenting the best option. The customer’s nutritional objective supports a meal choice which defines the ingredients and the shopping cart. The process is tailored from start to finish.

3. Coach behaviour –Supporting andprompting the customer to make the right buy decision at the right time. After all, customers have been known to forget to order on time. Maintenance and replacement of goods and services are prime examples. Track and support the customer in their buying cycle.

4. Automatic Execution -Using customer data allows a business to predicts and supply-demand to a customer without individual requests. This requires a high level of trust and transparency with the customer and continuous data exchange. It can be packaged with operational performance and availability guarantees.

My takeaways are :

1.    We need to continuously look at and improve the ease with which our customers can do business with us.

The first step in this process is getting data on customer behaviour and look for existing pain points they have doing business with us, plus patterns and systems to improve their experience and value proposition.

2.    Ensuring that our digital marketing, user interfaces, order to pay processes and SIOP process are performing and are aligned.

3. Attack lead-time reduction at every opportunity that benefits the customer.

4. Implement cost-effective enabling technology for collecting customer data and improving operational processes that provide a competitive edge are available today.

How is your business addressing and looking at these?