www.epri.com
Founded in 1973, the Electric Power Research Institute (EPRI), with head- quarters in Palo Alto, California, is a large,
private research firm serving members that collectively provides more than 90 percent of the electricity generated in the
United States. EPRI’s 350 staff scientists and engineers manage some 1,600 R&D projects at any one time. The projects, which study such subjects as power gener- ation, superconductivity, electronic and magnetic fields, and acid rain, are con- ducted by more than 400 utility, university, commercial, government, and other R&D contractors on behalf of the members.
The Challenge
EPRI’s mission is to deliver the informa- tion and knowledge from its research projects to the 400,000 employees in the 768 member utilities to help them be more competitive. Management realized EPRI had to compress the “information float,” the elapsed time from the avail- ability of research findings to the use of those results in industry.
The institute was suffering from
“info-sclerosis,” the hardening and clog- ging of its information arteries. Due to the volume of research findings—gigabytes of information—moving information in and out of EPRI was extremely difficult. In addition, because of the documentation and publishing process, the results often were unavailable for up to 24 months, so the reports were not as timely as they could be. Nor were the results accessible, because they were in massive reports.
Solving this information delivery chal- lenge was critical to EPRI’s survival.
The Vision
The vision was to assist members in exploit- ing EPRI’s product—knowledge—as a strategic business resource, whenever and from wherever they choose. To accom- plish this vision, EPRI built an electronic information and communication service.
As described by Marina Mann and her colleagues,15their delivery vehicle
is EPRINET, an online channel that includes
• A natural-language front end for accessing online information
• Expert system-based products that contain the knowledge of their energy experts
• E-mail facilities for person-to- person communications
• Video conferencing to foster small- group communications
Using Linkage Analysis Planning To focus the EPRINET effort and to identify the services and products that would offer strategic business advantages to members, EPRI used linkage analysis in a three-day workshop led by Kenneth Primozic. The workshop began with man- agement stating that (1) EPRI was both an R&D organization and a knowledge provider and (2) the goal was to leverage knowledge as a strategic asset.
From this starting point, Primozic asked, “Who is linked to EPRI in creating and distributing knowledge?” The par- ticipants identified the co-creators as contractors, research firms, universities, the government, and technology firms.
They identified the recipients as the util- ity industry, universities, research labs, government policies, and knowledge as capital—as shown in Figure 10. Each rep- resented a link to EPRI; therefore, the group then studied the present and future power relationships in each buyer–seller link. During these discussions, they saw how some current customers, such as uni- versities or research labs, could become future competitors and change the power relationship in a link.
Management’s goal was to leverage knowledge, so the group listed all the (Case Continued)
Scenario Planning
The final strategic planning approach is scenario planning. Peter Schwartz, who has written the definitive book on scenario planning,The Art of the Long View,16states that scenarios, which get their name from the theatrical term for a script or a play, are stories about the way the world might be in the future. Such stories can help people spot and adapt to aspects of their lives that are actually changing today. They help peo- ple find appropriate paths to each of the plausible futures described in the scenarios.
The goal of scenario planning is not to predict the future (because that is hard to do), but to explore the forces that could cause different futures to take place and then decide on actions to take if those forces begin to materialize.
M. Lynne Markus17points out that long-term planning has traditionally extrapo- lated from the past and has not factored in low-probability events that could signifi- cantly alter trends. Thus, these straight-line projections have provided little help.
ways leverage could be achieved. Then they focused on the most important way, which turned out to be treating knowl- edge as capital. During this analysis, management defined the following CSFs for giving EPRINET a sustainable com- petitive advantage:
• Establish the right mix of product offerings, a mix that allows people to pick, choose, and combine at the lowest possible cost.
• Keep all customers in mind, including utility executives, research engineers, and operations people.
• Use IT—specifically expert systems and natural language—to make the system easy to use and access.
• Create a range of “knowledge pack- ages” targeted to specific audiences.
• Establish a timely, reliable, secure global distribution channel.
Once EPRINET was made available, a marketing campaign began. The number of users has climbed steadily since. Fre- quent users report that the system is in- deed broadening the number of people they can stay in contact with and allowing them to uncover EPRI research findings that they would not have found otherwise.■ (Case Continued)
FIGURE 10 EPRI’s Linkage Analysis
Source: M. M. Mann et al., “EPRINET: Leveraging Knowledge in the Electric Utility Industry,”MIS Quarterly, September 1991, pp. 403–421.
Government
Utility Industry Universities and Research Labs Goverment Regulation/Policies Knowledge as Capital Contractors
Research Organizations Universities
Technology
EPRI
Output Input
Markus identifies four steps in scenario planning:
1.Define a decision problem and time frame to bound the analysis. In thinking about the future of IS, for instance, IS management might ask, “How will IS be managed 10 years from now?” An individual IS employee might then ask,
“What skills would I need to succeed in that organization, and what do I need to do to get those skills?”
2.Identify the major known trends that will affect the decision problem. Generally, scenario planners think about trends in categories: the business environment, government and regulations, societies and their concerns, technologies, financial considerations, the global environment, and such. Each trend is then judged by asking, “What impacts will this trend have on the decision problem?” “What are the directions of each impact?” Trends with unknown impacts or contradictory impacts are classified as “uncertain.”
3.Identify just a few driving uncertainties. Driving uncertainties are those around which others tend to cluster. Often scenario analysts choose just two, with two possible states for each, leading to four scenarios. The goal is to explore quite different futures, not the most likely future, notes Markus.
4.Construct the scenarios. Each scenario, based on a driving uncertainty, needs to be plausible. To create this plausibility, scenario writers include a “triggering event,” something that redirects the future into the desired space. For exam- ple, a triggering event could be a world event (the September 11, 2001, tragedy certainly qualifies), an action by a group (a major court decision), or a busi- ness event (the collapse of a large company). The scenarios depict the end state (at the selected point in time) and how that path was taken.
With these scenarios in hand, executives and planners then decide how well their current strategies would fare in each case. Then they ask, “Is there a better strategy, perhaps one that would cover more bases?” Also, they should determine what factors they should monitor closely to quickly spot changes in trends.
To give a brief glimpse of a scenario effort, here are four scenarios Markus created around the question, “What will in-house IS management look like in 10 years?”
CASE EXAMPLE