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IBM Turns On Southside Electric Cooperative to Software Recycling; Coop Delivers $1.2 Million Capital Credits Refund to Member-Owners


ARMONK, NY - 06 Mar 2007: IBM (NYSE: IBM) today announced that its expertise in the energy and utilities industry has helped Virginia-based Southside Electric Cooperative reduce costs and improve customer service. Southside Electric Cooperative is using IBM software and services as part of a larger business strategy designed to ensure uninterrupted service to a growing customer base while using the coop's existing software and hardware resources.

Unlike a publicly held or government-owned utility, an electric cooperative provides its service at cost and any funds above operating expenses are credited back to its member-owners. Southside Electric Cooperative's new business strategy helped the cooperative deliver $1.2 million in capital credits for 2006.

IBM's role in helping Southside achieve its business goals is through the creation of a 'service oriented architecture' (SOA). An SOA is a way of reusing a company's existing technologies to more closely align with business goals. Through its SOA, Southside Electric is able to protect information technology (IT) investments by recycling many of its existing software applications without compromising productivity or customer service.

As the state's largest geographic electric cooperative, Southside Electric has experienced significant growth over the past five years. In fact, the state of Virginia is the seventh fastest growing state and the burgeoning population is having an impact on the power supply.

For Southside, this growth presented business and IT challenges. The cooperative's previously unconnected systems resulted in service delays and reporting errors that affected Southside's service to its consumers. For example, when the cooperative mistakenly sent letters to the wrong batch of customers regarding a planned outage, the ripple effect on the call centers, dispatch teams, and billing department resulted in negative productivity and widespread frustration among customers.

These issues led Southside Electric Cooperative to evaluate the way the coop's investments in technology were aligned with its business goals of reducing costs and ensuring customers are not without electricity. The resulting decision was to create an SOA.

Southside Electric's SOA strategy was two-fold. The first priority was to bring together the CEO and business leaders with the cooperative's IT professionals to build consensus on the coop's new direction. The second part of the strategy was to link and recycle Southside Electric's myriad applications and data sources that track customer records, outage reports, automated meter management, geographical maps, billing and accounts receivable records, and service work as well as internal business processes such as finance, human resources, and procurement. By integrating the coop's existing applications and creating an SOA, Southside Electric was able to expand its software to now include a real time mobile data solution linking the field and the office using QUALCOMM's OmniTracs satellite communications as well as providing the field the capability to view its ESRI GIS system maps that replaced paper maps.

Southside Electric has realized significant benefits through an IBM-based SOA such as reduced administrative work, streamlined customer service processes, and expansion of the company's capacity for growth. More specifically, these benefits include reduction of service work from three days to one day; data entry that previously required 30 minutes is now complete within several seconds, and the coop's automated service order system is three times faster than the previous paper-based system.

"The before and after effects of building an IBM-based SOA have been like night and day for Southside Electric in terms of efficiency and effectiveness. Through IBM's standards-based technology and services expertise, we were able to integrate legacy applications and recycle our existing software while seeing dramatic improvements in our overall operations," said Linda Easter Davis, information systems supervisor, Southside Electric Cooperative. "Using IBM's SOA offerings and QUALCOMM technology allows our employees to spend more time doing what they're good at rather than filling out forms or spending time waiting for information. And in the process, we provide better services for our membership which is the ultimate goal for our cooperative."

Using IBM WebSphere software and services to build its SOA and integrate its various applications, Southside Electric was able to aggregate information from separate systems, giving employees a single, comprehensive, real-time view of customer accounts and engineering resources. Now, when information is updated in one system, the changes are reflected automatically in the others.

"Southside Electric is one of many energy suppliers that are quickly realizing the benefits of an SOA strategy. While the cooperative cites tangible benefits gained through the technology underpinnings of an SOA, it's important to recognize its first critical step on the path to success. This step is the creation of a cross-cooperative team representing each part of the business to ensure various needs are clearly understood, business goals are met, and the entire Southside Electric community realizes gains from its investments," said Mark Trekell, software sales leader, Energy and Utilities Industry, IBM.

About Southside Electric Cooperative

Southside Electric Cooperative was incorporated in January 1937. SEC is the largest geographic rural electric cooperative in Virginia, providing electrical services to some 52,500 members in portions of 18 counties, five towns and one city in southside Virginia over more than 8,100 plus miles of line. The Cooperative has four district offices, is active in economic development and maintains a good community relations program.

About IBM

For more information about IBM, please visit: www.ibm.com/soa

Contact(s) information

Kathleen Keating
IBM Media Relations
617-693-5429
kkeating@us.ibm.com

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