Skip to content
Product cover

Value Networks -- The Future of the U.S. Electric Utility Industry

July 15, 1997 | Michael Weiner, Nitin Nohria , Amanda Hickman, Huard Smith | Social Responsibility

Electric utility companies will have to reinvent themselves to change from 'vertical to virtual' integration based on value networks segmented into six areas: generation, transmission, distribution, energy services, power markets, and IT products and services."Several forces are creating challenges and opportunities in the electric power business. Customers and legislators are pushing for greater competition, while utilities are trying to preserve the status quo. Power companies are increasingly competing against each other, much like airlines and trucking and telecommunication companies. Changes in generation, transmission, and distribution are changing every segment of the value chain.

Weiner et al. predict five ways in which the electric utility industry will be affected:

1. Prices. Competition and consolidation will result in reduced prices.

2. Contracts. The number of short-term contracts will increase, as customers buy on the spot market.

3. New products and services. De-regulation means that electric utilities will be able to offer such items as on-line billing, remote appliance scheduling and control, energy-use monitoring, home-security systems, and electrical appliance maintenance contracts.

4. Global scope. Faced with little domestic growth, utilities will have to go abroad to develop new markets.

5. Information intensity. The amount of information and computer technology to develop efficient markets will grow exponentially.

To reduce costs, increase revenue, and expand globally, utilities will have to focus on six segments of the value chain: generation companies, intelligent transmission networks, distribution companies or "WireCos," energy services or "EsCos," power markets, and IT products and services. As the industry breaks apart, new entrants focused on high-profit, high-growth niches will not own all or even most of the assets in the value chain. They will configure only those activities that add value and that customers want. The authors foresee the evolution of three value network models:

1. Regulated value networks. States will mandate the initial form of value network in a transition to competition.

2. Virtual value networks. Each company will manage its own assets and competencies and expand its product scope to include energy and energy services, telecommunications, computing, and facility services.

3. Customer-designed value networks. With technology and direct market access, customers will manage their own networks.

Purchase Options

Educator and Student Discounts Available. Learn more »

  BENCHMARKS  
Loading Time: Base Classes  0.0005
My Controller Construct  0.0003
Build Nav  0.0005
Controller Execution Time ( Products / Route )  0.0391
Total Execution Time  0.0396
  GET DATA  
No GET data exists
  MEMORY USAGE  
1.5693 MB
  POST DATA  
No POST data exists
  URI STRING  
store/value-networks-the-future-of-the-u-s-electric-utility-industry
  CLASS/METHOD  
products/route
  DATABASE:  MITSLOAN_DEV   QUERIES: 68  (Hide)
0.0003  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0005  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0004  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0015  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0001  

SELECT *
FROM (`carts`)
WHERE `cart_id` =  '1c14f2c47a4abc623d100cf7f212b255'
ORDER BY `created_at` DESC 
0.0002  

SELECT SQL_CALC_FOUND_ROWS cat_id
FROM (`product_categories`)
WHERE `status_id` =  'A'
AND `url_friendly` =  'value-networks-the-future-of-the-u-s-electric-utility-industry'
AND `parent_id` =  1 
0.0099  

SELECT c.parent_id, c.format_id
                    FROM products AS p, products AS c
                    WHERE p.prod_id = c.parent_id AND
                        c.avail_id IN ('A','B','D') AND
                        c.type_id = 'V' AND
                        (
                            c.sku = 'value-networks-the-future-of-the-u-s-electric-utility-industry' OR
                            if(c.format_id = 'Certificate', '', p.url_friendly) = 'value-networks-the-future-of-the-u-s-electric-utility-industry'
                        )
                    LIMIT 1 
0.0002  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  2317 
0.0002  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '2317' 
0.0003  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '2317'
ORDER BY `sort` ASC 
0.0001  

SELECT `cat_id`
FROM (`product_categories__products`)
WHERE `prod_id` =  '2317' 
0.0001  

SELECT *
FROM (`product_flags__products`)
WHERE `prod_id` =  '2317' 
0.0001  

SELECT `sku`
FROM (`products__xsell`)
WHERE `prod_id` =  '2317'
ORDER BY IF(position = 0, 1, 0) ASC , `position` 
0.0066  

SELECT `products`.`parent_id`
FROM (`transaction_lines`)
JOIN `products` ON `products`.`sku` = `transaction_lines`.`sku`
JOIN `product_categories__products` ON `products`.`parent_id` = `product_categories__products`.`prod_id`
WHERE `products`.`avail_id` =  'A'
AND TO_DAYS(transaction_lines.updated_at) < (TO_DAYS(NOW()) - 90)
AND `product_categories__products`.`cat_id` IN ('300') 
GROUP BY `products`.`parent_id`
ORDER BY COUNT(*) DESC
LIMIT 6 
0.0002  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '4706' 
0.0002  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '4706' 
0.0002  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '4706'
ORDER BY `sort` ASC 
0.0001  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '2875' 
0.0002  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '2875' 
0.0002  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '2875'
ORDER BY `sort` ASC 
0.0001  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '5' 
0.0002  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '5' 
0.0002  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '5'
ORDER BY `sort` ASC 
0.0001  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '3907' 
0.0001  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '3907' 
0.0002  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '3907'
ORDER BY `sort` ASC 
0.0001  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '969' 
0.0002  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '969' 
0.0002  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '969'
ORDER BY `sort` ASC 
0.0001  

SELECT `parent_id`
FROM (`products`)
WHERE `prod_id` =  '297' 
0.0001  

SELECT *
FROM (`products`)
WHERE `products`.`prod_id` =  '297' 
0.0003  

SELECT *
FROM (`authors`)
JOIN `products__authors` ON `authors`.`author_id` = `products__authors`.`author_id`
WHERE `products__authors`.`prod_id` =  '297'
ORDER BY `sort` ASC 
0.0003  

SELECT SQL_CALC_FOUND_ROWS media_id, position
FROM (`media`)
WHERE `foreign_key_table` =  'products'
AND `foreign_key_column` =  'prod_id'
AND `foreign_key_value` =  '2317'
AND `kind` =  'image_600x600'
ORDER BY IF(position = 0, 1, 0) ASC , `position` 
0.0001  

SELECT *
FROM (`media`)
WHERE `media`.`media_id` =  '1046' 
0.0001  

SELECT *
FROM (`mime_types`)
WHERE `mime_types`.`extension` =  'jpg' 
0.0001  

SELECT *
FROM (`media_metadata`)
WHERE `media_id` =  '1046' 
0.0002  

SELECT SQL_CALC_FOUND_ROWS media_id, position
FROM (`media`)
WHERE `foreign_key_table` =  'products'
AND `foreign_key_column` =  'prod_id'
AND `foreign_key_value` =  '2317'
AND `kind` =  'gallery_image'
ORDER BY IF(position = 0, 1, 0) ASC , `position` 
0.0003  

SELECT *
FROM (`products`)
WHERE `avail_id` IN ('A', 'B', 'C', 'H') 
AND `parent_id` =  '2317'
AND `type_id` =  'V'
ORDER BY IF(position = 0, 1, 0) ASC , `position`, `title` 
0.0001  

SELECT `c`.`format_id`, `c`.`price`, `c`.`sale_price`
FROM (`products` AS c)
WHERE `c`.`prod_id` =  '2318'
LIMIT 1 
0.0002  

SELECT SQL_CALC_FOUND_ROWS media_id, position
FROM (`media`)
WHERE `foreign_key_table` =  'products'
AND `foreign_key_column` =  'prod_id'
AND `foreign_key_value` =  '2318'
AND `kind` =  'thumbnail'
ORDER BY IF(position = 0, 1, 0) ASC , `position` 
0.0002  

SELECT `product_categories__products`.`cat_id`
FROM (`product_categories__products`)
JOIN `product_categories` ON `product_categories__products`.`cat_id` = `product_categories`.`cat_id`
WHERE `product_categories__products`.`prod_id` =  '2317'
AND `product_categories`.`parent_id` =  1
AND `product_categories__products`.`cat_id` NOT IN (1, 261)  
0.0004  

SELECT `cat_id` AS id, `parent_id` AS parent, `status_id`, `name`, `description`, `url_friendly`, `page_title`, `meta_keywords`, `meta_description`, `position`, `updated_at`
FROM (`product_categories`)
WHERE `cat_id` != 1
ORDER BY `parent_id`, IF(position = 0, 1, 0) ASC , `position`, `name` 
0.0003  

SELECT *
FROM (`product_categories`)
WHERE `status_id` =  'A'
AND `parent_id` =  1
AND `cat_id` NOT IN (1, 261) 
ORDER BY `name` 
0.0002  

SELECT *
FROM (`site_settings`)
WHERE `option_key` =  'announcement' 
  HTTP HEADERS  (Show)
  SESSION DATA  (Show)
  CONFIG VARIABLES  (Show)