Hydro Quebec: Powering the Future with Renewable Energy

Hydro Quebec is a company that produces, transmits and distributes electricity in Canada and the United States. It is the largest energy producer in Quebec and aims to be a global leader in energy production and supply. The company underwent several structural changes especially in information management systems to ensure that it remains competitive, produce and distribute energy efficiently (Dube et al. 2007, p.1). The paper discusses the external and internal factors that led to the changes made by the giant company and recommended changes that the company can make.

External factors

            There were various factors which the company could not directly control. First, competition affected the company’s performance. Deregulation of the United States electricity market meant that more players were to be allowed to operate in the market. Consequently, Hydro Quebec had to let other market players operate in its home market (Dube et al. 2007, p.2). The change brought competition to the giant company of Quebec, and this meant that it had to operate efficiently. Before the move by the government to deregulate the electricity sector, the company was running as a monopoly in the country with no competition thus it earned high profits. Hydro Quebec began to make changes to show its assets and business expertise to new market players to counter the effect of increased competition in the electricity and power industry. The company created the TransEnergie division in 1997 to comply with the rules governing the markets in North America (Dube et al. 2007, p.13).

            According to Dube et al. (2007), the change in technology in the 1990s also led to significant changes in the information technology of the company. The company had used various IT management movements such as centralization and decentralization. Due to the changes in technology, Hydro Quebec decided to outsource an expert in information technology to provide their new systems instead of building their own which would be costly. The direction solutions informatiques was responsible for providing all the technology projects that the company required (Dube et al. 2007, p. 4).

            The changing customer preferences and requirements led to the change in the systems of the company. The legacy system that the company used was developed to serve the business context of the firm and not customer oriented (Dube et al. 2007, p.9). The company decided to implement a customer information system that would offer quality services to the clients. This system would ensure proper customer segmentation for the efficiency of operations.

Internal factors

            There were several inherent factors that led to the changes in the company to enhance efficiency and expertise. The new competition the company decided to separate its vertically integrated structure into various business units. According to Dube et al. (2007), the restructure led to the separation of the production, transmission and distribution activities which made up to six divisions. The divisions were made accountable and responsible for meeting the profitability criteria established by the board. The company created a shared service center that would offer internal support services to the new divisions that were established.

 Accordingto Venkatesh et al. (2003), the established divisions had the power to make decision and budgets of projects that were undertaken by the company supported by the shared service center. The firm decentralized decision making and budgets that were related to technological investments to the business units. The decision to decentralize was to ensure quick decision making and proper management of resources by the divisions. The units also had a better understanding of the technological needs than the management did. The shared services center was created to integrate the various business units to work together to enhance their efficiency and to help the firm in technological investments to ensure that the proper technology that would be viable in the business would be selected for implementation(Aubert et al.1996, 52).

            The change of focus towards a customer oriented business led to the change of the customer software applications to support customer strategies. The new software was to ensure that the customer expectations are met. The change in the information system came with professional challenges as some employees had to be moved to help in the implementation of the software (Dube et al. 2007, p.10). Training was also introduced to help the employees understand the new IT model for efficiency. Also, the system’s users were involved in the implementation of the new system to enhance their knowledge .the culture of the business also changed as it was now a customer service culture and the customers were provided for all the services that they needed so long as they can pay for them. The large customer base encouraged the firm to modernize its IT systems and get rid of the legacy ones to ensure that the customers’ needs are appropriately met, and they are incorporated in the system (Aubert et al. 1996, 54).

The firm had so many information systems that had been created but lacked an IT strategy. The firm defined its information technology strategy, and overall system plans .the strategy was to support the primary market segments which include business and commercial and the residential segment. The business strategies were also refined to ensure that the integration with the IT strategy was functional and that customer service was efficient.

Recommendations

            The changes made in the information technology management of the company were great but had challenges in the implementation stage. I would recommend some changes that the electricity firm can undertake to enhance its efficiency. First, the company needs to train its employees on the new system and processes to improve their customer service and skills which will improve the production and customer service areas. Also, Hydro Quebec needs to keep with the changing customer needs and the technology to ensure that the systems are enhanced for proper service and operations. The company should also encourage research and development to take proactive measure to the future external and internal challenges. The continued research on information technology will ensure that the company maintains its competitive advantage due to the use of sophisticated technology that will enhance their doing business in the home and foreign markets. The company should ensure that it continues to modernize its business processes and marketing strategies to help the company align its activities with the changing technology that will help them get a competitive advantage. Finally, the firm should ensure that all the business units make proper decisions on the technology.

Conclusion

            The technological changes made by hydro Quebec Company were essential in the improvement of customer service and giving the company a competitive advantage over the other companies in the industry.  The changes made will ensure that the company is in a position to meet its customers’ needs efficiently to earn more income. The changes will help the company become the largest electricity company in the world due to efficient operations.

References

Aubert, B. A., Rivard, S., & Patry, M. (1996). A transaction cost approach to outsourcing     behavior: some empirical evidence. Information & Management, 30(2), 51-64.

Dube, L, Bernier, C. and Roy, V. (2007). Information Resource Management at Hydro-Quebec.           International Journal of Case Studies in Management. 5(2): September. HEC203.

Venkatesh, V., Morris, M. G., Davis, G. B., & Davis, F. D. (2003). User acceptance of             information technology: Toward a unified view. MIS Quarterly, 425-478.