More than $120M in Cost Reduction Opportunities



Vertically integrated US Utility, with two million clients.

Business Issue

In 1997 we were engaged by the Transmission and Distribution Business of the client to be the architect of its transformation to an Asset Management organization. 

The company had made the strategic choice based on its own internal assessments of its performance, and the impending regulatory threats (the company serves in multiple States and must balance the pressures of Federal Regulators as well as those of both State Regulators).


We worked with the company to identify the organizational structure that would be required to support the business processes.  We also began a parallel effort to support the client in a detailed assessment of its current position. 


The assessment identified approximately US $120 m in cost reduction opportunities in the Transmission and Distribution Operations and Client Service areas. The transformation design was completed and implemented. The company installed the new organization without forced redundancies in the unionized ranks. During the last three months of the year, the company saved over US $10 M from reductions in unnecessary work, that was highlighted by the assessment.

The organization has also developed a Variable Workforce that has begun work outside its own system.

The utility has begun significant efforts in strengthening its leadership and alignment building skills.  The changes that have occurred as a result are significant.  The change in approach has been attributed to the shift in attitude toward several of the company’s wholesale clients.  The change in approach caused one set of wholesale clients to drop pending litigation against the company before the Federal Energy Regulatory Commission.