Power grid: digital nirvana

For example, the "Online Power Grid" App plan that the power grid is promoting needs to be supported by a data middle platform when it coexists with electricity bill portals from WeChat, Alipay or other front-end applications. This will enable better overall management and analysis of data traffic from different platforms, and in turn provide decision-making support for front-end market strategies.

The successive use of various digital technologies has also caused doubts and concerns from the outside world. Is the grid over-emphasized in the initial stage the construction of technical architecture and the use of various digital technologies? In contrast, is the pace of organizational structure adjustment relatively slow?

Another voice is that, even though the organizational structure is a more core factor, in the exploration period of "crossing the river by feeling the stones" in the integration of traditional enterprises with digital technology and Internet thinking, drastic organizational structure adjustments are likely to encounter resistance, and the cost of trial and error is unbearable. In the case of unclear investment returns for new technologies and new models, it can only start with local pilot projects, and only after the effectiveness of technological transformation has been verified can it be promoted. At that time, the resistance encountered by organizational structure adjustments will be smoother.

The relationship between 1 and 0 is that only when there is 1, the 0 following 1 is meaningful. In the process of steadily promoting this change, who is the 1 and who is the 0 in terms of the roles of technology tool integration and organizational structure adjustment?

“Internet-based” business models: the challenge of risk-taking

In the past three years, giants such as Alibaba, Tencent, Baidu, Huawei, and Xiaomi have adjusted their organizational structures and laid out industrial Internet to adapt to the explosive demand for B-end and G-end businesses in the ABC (A-artificial intelligence, B-big data, C-cloud computing) era. However, in 2019 alone, the power grid, which is also aware of the trend of digital economy and the arrival of the industrial Internet era, is relatively cautious in adjusting its organizational structure.

The main business of the power grid is a regulated business, with relatively little change overall. However, judging from the layout rhythm of multiple secondary subsidiaries carrying emerging businesses in 2019, there have been continuous actions. Adjustments to the organizational structure and flexible new attempts in business models are also more reflected in these secondary and lower subsidiaries that develop competitive businesses.

For example, the State Grid Electric Vehicle Company has established joint ventures with Evergrande Group and Guanghui Group, respectively, leveraging the complementary advantages of industry chain partners to achieve rapid offline expansion. The State Grid E-Commerce Company has tried the "horse racing system" internally, and has successively established the State Grid Blockchain Company and the State Grid Credit Company, launching a strong layout in the field of supply chain finance. In addition, the listing plans of the State Grid Information and Communication Industry Group and the State Grid Electric Vehicle Company are both in the works.

Traffic and capital are the common tactics used by traditional Internet giants in the consumer Internet era. In the industrial Internet stage with traditional enterprises as the protagonists, traditional enterprises have also learned from the above tactics. The traffic strategy of the platform economy has begun to be reflected in the business models of many provincial integrated energy companies of the power grid. In the face of C/B-end business, the Southern Power Grid established the Southern Power Grid Internet Co., Ltd. as the external entity for coordinating Internet business.

In this regard, the outside world is worried about whether it is possible to establish a service content-oriented mechanism in terms of methods and means of attracting traffic, rather than continuing the past planned methods to build short-term "traffic". The latter method is obviously unsustainable, and the platform does not have long-term competitiveness.

In addition to pursuing business model innovation, innovation in the field of science and technology is particularly critical.

On May 28, State Grid Corporation of China announced eight measures to strengthen open cooperation in scientific and technological innovation, including "four openings and four cooperations". Specifically, the "four openings" include open sharing of experimental research resources, open cooperation in scientific and technological project research, open implementation of scientific and technological demonstration projects, and open application of new technologies in the whole society. The "four cooperations" include co-building an energy and power innovation community, co-building a national dual innovation base, co-sharing a scientific and technological service platform, and co-operating in the operation of scientific and technological innovation enterprises.

Among them, foreign cooperative scientific and technological projects account for no less than 60% of the company's annual projects; give play to the "leverage" effect of various industrial investment funds to form a diversified capital investment mechanism of "active investment by companies and competitive integration of social capital".

This move to change the system and mechanism of scientific and technological innovation sends a signal of open cooperation. It is also a method for many Internet companies to incubate innovative technologies in the form of joint laboratories. That is, through open and shared resources, joint research and development is carried out, and on the basis of brainstorming and mobilizing social innovation and research and development forces, multiple parties share research and development results for mutual benefit.

How to make light of heavy tasks and play the role of capital ties is also on the agenda for power grid companies in 2019.

The establishment of China Southern Power Grid Industrial Investment Group and State Grid Yingda Industrial Investment Fund Management Co., Ltd. is to follow up the latest technology startups or new business models in the market from the perspective of capital. However, unlike the "venture capital" approach in the Internet field, the power grid is doing "industrial investment" that can bring about industrial chain synergy and relatively low investment return risk.

From the outside, strict control over projects helps to maintain and increase the value of state-owned assets. However, the focus on low risk may lead to missing out on opportunities for potential growth business projects, or even projects that may bring disruptive effects in niche areas.

Concept implementation: Several major problems to be solved

Starting from the fourth quarter, the power grid clearly felt the pressure from time.

On October 12, Kou Wei said at a video conference to promote the construction of the State Grid ubiquitous power Internet of Things, "There are less than three months left until the end of the year. The company must make greater efforts and greater determination, with a spirit of seizing the day and hour, to innovate and overcome difficulties to ensure the completion of the annual construction goals."

From the outside, the "sense of urgency" signal and the spur to progress released by the above meeting are obvious.

The goal and timetable of the State Grid is to initially build a ubiquitous power Internet of Things by 2021. For example, in terms of internal business, the online rate of business should be 100%; for external business, the online rate of electricity-related business should be 70%; and a data center with unified standards and models should be initially built. After another three years of quality improvement, the ubiquitous power Internet of Things will be built by 2024.

However, even if the top-level design keeps abreast of the situation and opportunities of the digital revolution and energy revolution, there is still a gap between the beautiful vision and the implementation at the grassroots level. This is the first gap encountered in the transformation of the power grid - there is a time lag and misunderstanding in the process of "top-down" strategic vertical transmission.

In just one year, there are many problems in the actual progress. A person related to the power grid told eo that many operators have an inaccurate understanding of digital transformation and still continue the idea of ​​building systems during the traditional informationization period. In this regard, Kou Wei pointed out in the above-mentioned promotion meeting that "we must resolutely break the shackles of traditional concepts and must not simply copy the routines of power grid construction and informationization construction."

Another problem the power grid faces is whether to choose “let a hundred flowers bloom” or “focus on a specific goal”?

From the perspective of external constraints at this stage, the power grid is facing the pressure of revenue tightening due to the "lower electricity price" policy on the one hand; on the other hand, it needs to consider the extremely "uncertain" investment returns brought by new businesses, new formats, and new models, which is completely different from the previous situation where infrastructure investments such as power grid construction have a stable rate of return. Although the choice of "letting a hundred flowers bloom" can fully mobilize enthusiasm, it will bring pressure on cost investment in the short term.

Kou Wei also made some "reminders" about this issue. "Don't start from scratch, demolish and rebuild, or engage in low-level duplicate construction. The goal is to solve problems and create value. We should reasonably determine construction projects, make up for shortcomings, strengthen weaknesses, and improve efficiency. We should also do a good job of input-output analysis for new system and business innovation projects."