Failure of Electrical Utilities, Essay Example

Introduction

This paper focuses upon the ageing population in the Electrical utilities field. The assertion put forward is that the industry comprises an ageing workforce population, rapidly approaching retirement, but no provision has been made for the transfer of knowledge and experience to the intake of younger replacement personnel. Failure of the electrical utilities industry to adequately preserve transitioning workforce knowledge will have an impact on the industry.

Analysis of the key issues

It was R. Davis that examined statistics produced by the International Labor office and published these illustrating the scope of the problem. He highlighted significant shifts in the age distribution and how this potentially will create a de-stabilization of the future industry workforce. (Davis, 2005). This impending future dilemma will impact the industry in reduced operational productivity and operational costs. (Delong, 2004). Delong pointed out that this is not a new experience and that NASA experienced similar problems when many of its electricians and space program technologists left the business. Hence there is historical references to other organisations that did not account for this and suffered consequences as a result. (Delong, 2004).

The Utilities industry, by not paying sufficient attention in recognizing the problem will suffer similar consequences as a result. This lack of strategic planning for the industry will significantly increase costs and will hit the bottom line by increased maintenance costs, increased worker injuries (increased worker compensation) and the loss of potential revenues by the inability to complete programs of work. (Bruffy, 2006).

The Utilities industry faces recruitment problems in attracting the right people into the industry. This often a result of visible poor strategic planning and the entrenched views of senior management within the industry. In addition the failure of Government to provide insufficient economic reforms in support of the industry. (Smith, 1996). Equally, the cut back in the use of apprentices in the industry, most likely the result of austerity measures being adopted by the utilities industry, has created gaps in the development of future essential staff skills. There is also the issue of climate change illustrated by Hurricanes e.g. Katrina and the Eastern Seaboard of the USA. These will create power outages on an unprecedented scale and place even further strain on the demand of electricians within the Utility companies. (Lipsig-Mumme, 2010).

Taking affirmative action

The Utility industry is having to realise they are facing a period of extraordinary change and transition. This evolves around more government intervention via economic and regulatory reforms. (Ashworth M, 2007). The need to face the employment and skill changes and reflect this in both strategic planning and the smart grid initiatives. The alarm bell of 2015 when 50% of all utility workers will be eligible for retirement and very few initiatives to address this problem. This dilemma will create the need for more capital investment and with the instability in the financial markets the picture looks bleak. (Analysis Group, 2013).

Conclusion

Utility industries need to recognise the urgency of this situation and start the transformation planning immediately. From 2015 this could rapidly turn into a crisis situation and transformation is always more difficult when moving from a disaster recovery platform. Capital investment is essential to address the many transition programs required. (Borland, 2013)

References

Analysis Group. (2013, 7 27). What’s Keeping Electric Utility Executives Awake at Night? Retrieved from Analysis Group: http://www.analysisgroup.com/whats_keeping_electric_utility_executives_awake_at_night.aspx

Ashworth M, G. C. (2007). The aging workforce: Electricity industry challenges and solutions. Elctricity Journal Vol 20(2), 71-80.

Borland, J. (2013, 7 19). Ashortage of talent. Retrieved from Transmission & Distribution World: http://tdworld.com/mag/power_shortage_talent/

Bruffy, Y. s. (2006, 1 1). Strategic and financial solutions necessary to manage aging workforce transition. Retrieved from Natural Gas and Electricity, Vol 23(1) pp 1-7: Http://ehis.ebscohost.com.vlib.excelsi

Davis, R. (2005). The Aging Utility Workforce: Increasing Pressures on Resources, Costs, and Productivity. KEMA, 1659.

Delong, D. (2004). Lost knowledge confronting the threat of an aging workforce. New York: Oxford University Press.

Lipsig-Mumme, C. (2010). The State of Research on Work, Employment and Climate Change in Canada. Toronto, Canada: York University.

Smith, V. (1996). Regulatory Reform in the Electric Power Industry. Regulation 1996 numner 1, 33.