With soaring natural gas prices along with disasters in the form of Katrina, Rita and Wilma the energy industry is grappling with escalating costs. Considered as traditional and conservative, the energy sector is often a late adopter or even a forced adopter of technology. Often with minimal investment in IT, CIOs try to make business process easy, efficient and safe.

“This is not the kind of industry that has the margins or support for experimenting with technology. Unless we can see some risk worth taking for massive competitive advantage,” opines Kumud Kalia, CIO of Direct Energy. With over 5 million customer relationships, Direct Energy is part of the Centrica group of companies, the largest non-utility retail energy provider in North America.

While the energy companies are often viewed as stable but boring, Direct Energy begs to differ. Focusing on growth and customers, as opposed to the traditional utilities who own pipes and wires, Kalia hopes to leverage IT in delivering innovative solutions and meet the customer needs. Engaging IT at various levels, he believes IT should enable business units become more agile as they respond to shifts in the market dynamics and use technology to respond to price changes in the market.

While the industry as a whole is trying to deal with escalating commodity prices, cost of natural gas and starving the technology divisions, Direct Energy is trying to develop a competitive difference, a proposition to uphold commodity energy with services.

“We are developing some technology applications, for business customers to manage their usage and tie discreet pieces together,” says Kalia.

Kalia believes there is a huge opportunity for the energy industry to leverage technology. “I think the energy industry hasn’t really grabbed the opportunity or seen the advantages of the various applications be it supply chain or anything as a competitive advantage,” he says.

Using supply chain for delivery of electricity to the customer is remarkably efficient, somewhere electricity is being generated and simultaneously somewhere the demand is created when someone turns on a switch. There is no delay or waiting time. But this is not the same when a new customer seeks to procure electricity. It is here Kalia expects to make the difference. He hopes to streamline the infrastructure so that a new customer wait-time to procure electricity is reduced considerably. “We know supply chain works. Leveraging technology we can provide much improved services to our partners,” says the positive Kalia.

Having joined Direct Energy less than a year ago, Kalia has charted his course in the company having done the initial assessment of the IT capability in the organization. “Here at Direct Energy, things work and the required infrastructure is in place. So I have had the luxury to be able to focus on different aspects, like enterprise architecture competence, to build a service oriented architecture,” he adds. Kalia hopes his applications would reduce the marginal cost of doing capital project work allowing for a shared infrastructure that the company can leverage, whether it is middleware or data warehouse.

With firm goals Kalia places SoA in the top priorities for the next year. “Now that we know what to do we will focus on process engineering,” he says. Kalia is also involved in introducing best practices from other industries, which will enable business processes that drives the team’s architectural principles, applications and solutions.

Steering a team of 400 people spread across Houston, Calgary and Toronto, Kalia places heavy importance in his team. He believes experience in varied and non-traditional career paths would allow a person to adapt into various roles. While placing heaving importance in applying skills, Kalia is quick to note that the ability to run not only IT but also business functions is a key for growth. While introducing new competencies and process engineering, Kalia is trying to scale and looking for hybrid professional that understand the technology very well.

Looking at the tremendous advancement in the health care and financial industries after adopting technology, Kalia believes the next few years’ applications for the energy sector would be the turning point for this late adopter.