Energize your investment management strategy in the energy and utilities sector
April 6, 2023 / Mona Hillenbrand
Short on time? Read the key takeaways:
- The global energy and utilities sector is growing, and investment in this sector is increasing. Effective investment management is vital for energy and utility organizations to take advantage of new opportunities and make fast decisions.
- Investment management solutions should have real-time insights and robust analytics to provide up-to-date information for informed decision-making. Analytics tools can help with portfolio analysis and precise forecasting.
- Investment management solutions should provide data unity and traceability to ensure consistency and alignment between the company's overall strategy and investment management strategy. Automation can streamline investment processes and free up resources.
- Security and compliance are of utmost importance when it comes to investment management technology. Selecting a provider that prioritizes security and compliance can protect sensitive investment data and prevent costly data breaches.
The global energy and utilities sector is growing. With more funding than ever, energy companies are faced with more to do, which means more investments to manage and fast decisions to make.
A 2022 IHT Markit report shows how the cumulative global energy sector capital expenditures are projected to increase by 18% compared to 2016-2020. In 2021-2025, transmission and distribution spending is projected to increase by $433 billion, followed by renewables at $367 billion and oil and gas spending at $209 billion.
So how can energy and utility organizations take advantage of new opportunities without getting bogged down in managing all the funds? Monitoring, analyzing, and optimizing your investments can be challenging with constantly changing market trends and many investment options. Compounded with massive external challenges and the need to make decisions quickly for companies in a transformational environment like the energy and utilities industries, effective investment management has become even more vital. Finding technology solutions that simplify this critical work for your organization is more important than ever.
This post highlights four key capabilities an investment management solution should have to simplify processes and improve investment outcomes across your portfolio.
Real-time insights and robust analytics
According to a McKinsey study, companies that leverage data are 19 times more likely to be profitable, which makes access to up-to-date information about investments essential for portfolio and investment management. Therefore, seek a solution with tools that offer real-time insights and robust analytics. Analytics tools enable in-depth portfolio analysis and informed decisions on resource allocation. With more reliable and accessible data, you can apply the strength of SAP software to unlock more precise forecasting for your finance and project management teams.
Data unity and traceability
Siloed data occurs when different departments or business units use different systems to manage data, leading to data inconsistencies and inefficiencies. Similarly, decoupled visions happen when there is a lack of alignment between the company's overall strategy and the investment management strategy. To avoid these issues, companies need a singular, unified tool to manage large investment and expenditure programs with little integration effort required. This integration can help ensure that all data is consistent and up-to-date and that investment decisions are aligned with the company's overall strategy. Another critical feature of an investment management solution is clear data traceability. This traceability is essential for regulatory compliance and can provide peace of mind for your organization and stakeholders alike. Additionally, it can help you identify errors or inconsistencies in your data, enabling you to make more accurate investment decisions. By providing clear data traceability, investment management software can help energy and utility companies ensure the integrity of their investment management process.
Technology tools can also help automate specific investment processes, saving you time and resources. Automation allows you to streamline the investment process, from trade execution and settlement to performance reporting and compliance. An investment management solution that automates these processes can free up valuable time and resources, allowing you to focus on other critical aspects of your business.
Security and compliance
When it comes to investment management technology, security and compliance are of utmost importance. Reputable technology providers prioritize ensuring their solutions meet the highest security standards and comply with industry and regulatory requirements. Selecting a provider that stays up to date with security practices and maintains secure systems is crucial.
A secure and compliant solution will protect sensitive investment data from external threats and prevent costly data breaches. This means that data is secure and confidential, which is essential for business operations and customer satisfaction. With the right technology provider and solution, organizations can have peace of mind knowing that their investment data is protected.