Rethinking Organizational Culture Is Vital For Water Utility Innovation

In a new report, “Empowering Water Utility Innovation,” Arcadis outlines a step-by-step process for implementing key business disciplines that are necessary for fostering a culture of innovation at water utilities


Water utilities across North America are facing incredible challenges ranging from aging infrastructure and flattening demand, to water supply variability and increasing consumer expectations. Further, the pace of change is accelerating. Leading utilities are rethinking current business models and turning toward innovation management as a catalyst for creating more agile organizations. While some utility leaders are at the forefront of innovation and are adapting to new technologies and disciplines to propel their utility forward, many others lack a road map to innovation.

In a new report, “Empowering Water Utility Innovation,” Arcadis outlines a step-by-step process for implementing key business disciplines that are necessary for fostering a culture of innovation at water utilities. The report further explores the numerous “sustainability dividends” that innovation provides utilities, their investors and the community. The Arcadis report is based on a recent Water Research Foundation (WRF)/Water Environment & Reuse Foundation (WE&RF) project, “Fostering Innovation within Water Utilities,” which offers a guidance manual for accelerating innovation in the water sector. This work provides a path to achieving the culture change necessary for utility leaders to drive innovation to meet tomorrow’s challenges.
As part of this work, the research team identified eight disciplines of an “innovation engine” that enables utilities to explore new processes, services, technologies and possibly business models, ultimately yielding sustainability dividends. These dividends, such as greater revenue capture, waste reduction, water supply diversification, asset longevity and network continuity, can improve the financial metrics and resiliency for the utility, customer and region.

The eight key disciplines include:
1. Visualize—maintain a long view that empowers and inspires innovation. Utility leaders must articulate the urgency for innovation and importance to the future of the organization.
2. Focus—define challenges that guide investment. Effective innovation programs look beyond the latest technological breakthroughs for concepts that align with organizational priorities and values.
3. Develop—invest resources in new ideas. Utilities must be able to allocate resources for the development of new concepts such as funding, time and engagement of subject matter experts.
4. Evaluate—test concepts in scaled and relevant applications. Effective programs provide safe environments for testing progressively mature concepts in applicable settings with end-users.
5. Engage—motivate, enable and reward stakeholders. Transformative innovation programs invite broad participation of employees and stakeholders to provide thoughts and ideas.
6. Reach—utilize resources outside of organization. Stakeholders outside of the organization including peer utilities, consultants, universities, research centers, manufacturers and customers provide a vast array of new ideas that help utilities move beyond their organizational anchoring.
7. Communicate—capture and convey defining success stories. Powerful programs celebrate successes that highlight the values of the organization and impact of innovation
8. Evolve —implement concepts and measure impact. Ultimately, innovative utilities must promote organizational readiness for new ideas and concepts. This begins with the commitment of leaders but ends with the adoption of innovation into the normal course of business.

A few simple and practical steps utilities can take to build an innovation engine, whether your program is entirely new or you are looking to enhance it, include:
Phase 1 – Assessing Innovation Environment. Using a customized and scalable cross-departmental survey will help assess the current innovation environment and identify gaps. Crucial observations may include differences in self-assessment scores between departments, roles and stakeholder groups. Including surveys as part of the fact checking exercise will help validate and take inventory of available resources. Effective self-assessment surveys and analysis enable utilities to build on strengths and address organizational and cultural gaps. Open forum discussions provide a great opportunity to capture pain points that may become focus areas for innovation as well as early ideas for consideration.
Phase 2 – Program Creation. Sustainable utility innovation programs are tailored to the expectations, environment and resources of a specific utility. While these eight key disciplines are useful for initial assessment and goal setting, our team simplified the disciplines into three primary elements for innovative utilities: Impact, Capability and Engagement (ICE Utility Innovation Framework). This framework provides utilities the flexibility to use industry metrics and user defined discipline maturity levels to develop “fit for purpose” program elements to build impact, capability, engagement and organizational readiness. Establishing an innovation leader early in the program creation phase is a key catalyst for effective planning and program launch.
Phase 3 – Program Launch. Launching a successful innovation program includes a healthy dose of urgency, practicality and reflection. Change, of any magnitude, requires breaking the gravitational pull of current practices and clearly articulating the benefits of acting now. Doing so doesn’t need to be grand or hasty though. It’s best to start small to win hearts and minds at all levels of the organization. We also recommend avoiding aggressive goal-setting in the start. Early metrics should focus on the impact of specific innovation ideas and improving over time as the program gains acceptance. A final recommendation to consider when launching your program is, revisiting resources. After six to 12 months, innovation leaders should revisit the impact of and investment in the program as well as assess feedback from innovation teams. Doing so will make sure the engine is running smoothly.

Jason Carter is the Delivery & Innovation Lead for Arcadis North America. He has over 18 years of experience in strategic planning, compliance, and optimization services. Currently, he leads the North American Innovation and Intellectual Property Programs, which develop new insight and solutions for emerging challenges across the water, environment, infrastructure and buildings sectors.