Example Reflection - Visualization

Challenge  The challenge I would like to deal with is “nullify electricity cost” for residential customers by means of  disruptive business model innovation.

Today the classic business model of utilities is producing electricity by means of power plant and sell it   to final customers, with an average cost of 0,21c€/kWh in EU-281 and 12,75c$ in US2, that became an  average bill of 78,75€/month/household in EU-28 and 114,03$/month/household in US.

Today, thanks to renewable energies technologies and innovative business model, “consumers” are  becoming more and more “prosumer”, so a consumer that consume and produce electricity at the same  time: this change of paradigm is leading to a new era of distributed generation. In order to complete this  shift from centralized from distributed generation, it has to faces numerous challenges, both technical  (smart grid, security, safety…) and legislative (the sector is very regulated): at that point, also thanks the  decreasing cost of technologies, the cost for electricity will decrease a lot but will never be “0”: there will  always be someone paid for producing it and someone paying for using it.

The idea is possible, let’s see for example what happened in television sector in 90’s: some TV were  “free” (but they charged you of a lot of advertisement) while other have a subscription fee but they were  totally advertising-free. And this simple business model apply today to many other sector (apps,  newspaper, blog, games….).

How we can apply different business model to the electricity sector in order to nullify the cost for house  owner customers, taking advantage from modern trends and technologies (AI, big data, social network?

Selection  I decided to select visualization tools because it allows to do inductive reasoning and to enlarge  boundaries of our thinking. Actually, visualization is a good tool for dealing with complex problem, where  solution are not univocal and where creativity is necessary. This approach can range from simple  sketching to using photography but the idea is always the same:  visualization activate visual thinking and  unlock a different part of our brain (the left one), allowing it to create ideas that still not exist yet. Finally,  visualization allow to better communicate an idea and to have a common understanding of the problem.

Application   Among the visualization tool, I preferred the sketching techniques associated to pictures: I find it very  useful in order to create a common understanding and a starting common ground for thinking. In this  case I started sketching different type of “house owner customers” (family, single, elderly people…)  coupling them with a photography. Then, I submit my initial sketch to teammates and I asked them to  draw the place in which they live (their house) and make then a “circle” around every place/customers.  Then I asked them to draw around the circle which external subjects they are in relation with (or could  be in relation) because of thatplace (companies providing services, company where they bought goods,

1 http://ec.europa.eu/eurostat/statistics-explained/index.php/Energy_price_statistics  2 https://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_6_a

administration) and to connect them with arrows, indicating the monetary flow for the service/tool/data  they could buy or sell (or the possible one if the relationship is not yet present).

Insight   The result of the experiment were exceptional because allow to generate new ideas about possible  relationship between house owner and external subjects. The map generated allowed first of all to  clustering different type of customers and their consumption (single, family, student, elderly people) and  then to see, for each of them, which relationship could be create value for finding the new business  model and move the cost of electricity from house owner to another subject (interested in selling a  service or to buy some data, time…)

Approach  An alternative approach for reaching the same results would have been “the journey mapping”. Journey  mapping would have allowed to assess the existing experience through the customer’s eyes. If the  previous experiment was spatially focused (on what happens in “house”, the place where electricity is  consumed), journey mapping could have explored customers’ relationship along the day and in different  times: actually, there is no reason for thinking that value has to be connected only to the house but  could be found in another moment and used for reach the same objective.

