Resource Data Best Practices: How to Align Your Organization and Start Driving Results

Blog | Read Time 8 min
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Tony Pandolfo Director
Bryan Hopper Director
Resource Management
Data Management
Organizational Transformation

In their 2019 article in the Harvard Business Review, Companies are Failing in Their Efforts to Become Data-Driven, Randy Bean and Thomas Davenport look to explain why most organizations are failing to become data-driven, despite goals to, “treat data as an important asset, evolve their cultures in a more data-oriented direction, and adjust their strategies to emphasize data and analytics.”

After surveying C-Level technology and business executives at some of the world’s largest organizations, the authors found that most respondents cited organizational alignment issues as a primary obstacle.

In our experience, this has often been the case. Too often, functional leaders independently pursue point solutions that solve an immediate business need but contribute to fragmented and siloed data architectures.

As a result, we often learn that amassing data isn’t our clients’ primary challenge when it comes to managing energy, water, waste and telecom expenses, as well as greenhouse gas emissions. After all, many are already capturing resource data from supplier contracts, utility bills, building management systems, submeters and IoT sensors.

Instead, the challenge that many organizations face is leveraging actionable data to drive results.

With uncertainties in the global economy, changing work procedures, and mounting pressures to take substantive climate action, there has been no better time for an organization to take a closer look at its data systems and operations and re-evaluate whether they have what they need to effectively manage resources and reduce costs.

What is Resource Data?

Resource data shows how much energy, water and waste a business is using or generating and how much it costs. Having this data helps companies establish baselines, create budgets, set goals, measure results and identify outliers to prioritize improvements while optimizing expenses.

Resource Data Questions to Ask 10 Teams Across Your Organization

In the following article, we offer key questions and best practices for ten teams across your organization to help you determine whether you have the infrastructure and functional alignment needed to action your data and achieve your strategic objectives.

  1. Procurement
  2. Utilities / Energy Management
  3. Sustainability
  4. Operations
  5. Facilities / Properties / Real Estate
  6. Finance
  7. Accounts Payable
  8. EHS & Compliance
  9. Information Technology
  10. Strategic Planning

1. Procurement

Tasked with managing costs and supply chain risks during one of the most volatile periods in history, it’s critical that procurement offices have the site, supplier, contract and market data they need to take advantage of favorable buying opportunities and limit their exposure to unforeseen price swings.

Key questions for procurement managers:

  • How should the futures market impact your hedging strategy, and what does a selective hedging strategy look like?
  • How many energy and waste vendors do you work with, and what efficiencies/risks does that level of vendor diversity produce?

2. Utilities / Energy Management

Utility managers need line-item details to connect their energy costs to actual usage, but they also need that data to be reportable. Data management systems need to be sophisticated enough to capture the thousands of line items that different vendors use to charge for volume, usage, time-of-use, transportation, environment and taxes. They must also be flexible enough to help utility managers understand which charges are addressable through purchasing, equipment or behavioral changes.

Key questions for utility managers:

  • Which vendors are most likely to introduce significant price changes, and how will those tariff or rate changes impact your energy spend?
  • What portion of your energy expense is weather-driven, and how do long-term weather models influence capital decisions?

3. Sustainability

Until an organization powers its operations from 100% renewable resources, its environmental impact is significantly influenced by the generation mix of local grids. Moreover, investors, regulators and other stakeholders are beginning to scrutinize management of water and waste streams as well as GHG emissions. To determine where they can make the biggest environmental impacts, sustainability managers must evaluate the composition of their current and future electrical grids, tie their water footprint to local risks, and assess waste diversion opportunities across their portfolio.

Key questions for sustainability managers:

  • How is the domestic energy supply changing, and what impact will those generation changes have on your near- and mid-term GHG emissions?
  • How do your water and waste programs compare to your peers, and how are stakeholder expectations changing?

4. Operations

Operations managers face a tall task: driving production through scheduling complications, employee health and safety precautions and an unstable supply chain. Power quality issues and unplanned downtime is not an option. With limited capital available for reliability investments, operations managers must understand the cost-implications of hourly production changes and they should look for capital-free efficiency and resilience projects.

Key questions for operations managers:

  • How do production and schedule changes impact energy costs, and which projects offer the biggest/fastest return?
  • How exposed are you to grid-level disruptions, and what are the most economical ways to improve power quality and assure uninterrupted operations?

5. Facilities / Properties / Real Estate

In the age of remote work and varied local social-distancing measures, traditional KPIs like energy or water consumption per square foot just aren’t applicable. With significant differences between occupancy, production and regional pricing, facility managers need more relevant benchmarks to evaluate building performance. Moreover, variability in cost and consumption may be hiding water leaks, power factor penalties or malfunctioning equipment. Advanced metering and sensor equipment has never been more important.

Key questions for facility managers:

  • How do your sites stack up against one another and industry peers, and what key data aren’t you getting from your building management systems?
  • How much can you save by rescheduling key equipment maintenance to other times of day?

6. Finance

With ever-changing production levels, regulations and market prices, developing a reliable energy budget can be a real challenge. The COVID-19 pandemic hasn’t made that any easier. As organizations begin to map plans for 2021, it’s critical that finance teams have visibility into energy costs per dollar of revenue and can predict the impact that potential price changes will have on earnings.

Key questions for finance managers:

  • What are the key drivers of your budget performance/variance, and how exposed are they to market/regulatory changes?
  • How is COVID-19, political uncertainty, and market volatility impacting the value of your energy positions?

7. Accounts Payable

Managing cash flows has never been more important, from auditing invoices for errors and savings opportunities to reducing late fees and security deposits. Moreover, the most competitive companies are finding ways to reallocate back-office personnel from time-consuming tasks to value-adding activities.

Key questions for AP managers:

  • How many days does it take to pay an invoice and how much are you accruing in late payment penalties?
  • Do you know how much billing errors cost you, and how much cash do you have sitting with suppliers as you negotiate refunds?

8. EHS & Compliance

In collaboration with facility personnel, environmental managers and compliance officers are challenged to ensure that their operations comply with a myriad of local, state and federal regulations while adapting policies to shifting COVID-19 forecasts and guidance. Without sound data and central governance, organizations are likely to remain reactive – endlessly putting out fires and unable to systematically improve procedures and reduce costs.

Key questions for EHS & compliance managers:

  • How do you track evolving waste-stream regulations, and where are your compliance risks most severe?
  • Which of your sites presents the best opportunities to lower costs through diversion and competitive procurement?

9. Information Technology

Increasing digitization, network diversification and fast-changing technology are all making it harder than ever to manage the hard and soft costs of a modern telecom network. Very often, organizations can add six or seven figures to their bottom line by automating bill collection, processing and payment, and by building the inventories needed to manage their telecom programs.

Key questions for IT managers:

  • How many inactive lines and devices are in your inventory, and how much can you save by auditing invoices and optimizing service agreements?
  • How many hours does your organization spend opening and closing accounts, responding to help desk tickets and managing vendors – and how are those tasks taking priority over strategic projects?

10. Strategic Planning

Despite all the challenges that arose from the COVID-19 global pandemic, the need for global action on climate change has not abated. Sustainability leaders are even leveraging lessons from the coronavirus to deliver purposeful action, quickly. Investors, customers and regulators continue to set higher standards, and organizations are responding with Scope 3 goals, science-based targets, carbon negative goals and innovative ways to incorporate sustainability into their core business strategy. Integrated reporting is on the rise; issuance of sustainability-backed bonds is at an all-time high; data centers are leveraging renewable energy to attract customers; consumer packaged goods companies are embracing circular business models. The value of a simple REC purchase is changing.

Key questions for the executive team:

  • Which renewable energy products will unlock the biggest revenue streams and strengthen brand value?
  • Which upstream and downstream vendors most significantly contribute to your Scope 3 emissions, and how can you address those emissions without straining your value chain?

How The CFO Can Drive Sustainability Transformation. Read blog →

Take The Next Step

Hopefully your organization is already taking steps to answer the questions above. If so, you’ve likely succeeded in building a data-driven organization and have claimed a serious competitive advantage over your peers.

If, however, your organization does not have the resource data, processes or strategies in place to adapt to pressures related to the sustainability transformation, then we strongly recommend scheduling a discovery session with one of our experts.

To learn how leading organizations are consolidating resource data and driving bottom-line results, contact us today.

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