Continuing our series of blog articles on I-SEM, a view on business readiness planning and what it should entail is a timely topic considering it is now only one year until Market Trials commence.
As we know, the fundamental impact of ISEM will be a financial one - centred around how much generators will receive and suppliers pay under the new multi-tier market and operating to avoid exposure on the Balancing Market. However, the impact of twisting to operate in this new way will created impacts across the organisation.
Ideally, each participant should by now have an internal project established and be driving towards a detailed ‘Readiness Plan’ for operating in ISEM. Although different for every business, this should have a focus on two key strands: market readiness and the readiness of the wider business.
In terms of Market Readiness the internal project needs to work through:
- Assessing a new operating model including ‘as-is – to-be’ process mapping and day to day operational functions and resourcing;
- Business strategies for operating in the market: Trading Strategy and Risk Governance;
- Assessing changes to ICT systems to support new operating model: new solutions, integration requirements, support arrangements, business intelligence, forecasting;
- Training of staff required to engage with the market on systems, processes and strategies;
Using this as a baseline, the impacts on the wider business functions can be worked through and woven in:
- HR – contract reviews, new resourcing requirements and skill sets, recruitment
- Legal – Trading contracts, Licence changes, Market rules review,
- Finance – Credit rules, collateral, Risk and Financial reporting changes.
The final piece of the readiness jigsaw will be planning in business acceptance testing and cut-over/transition to the new operations next year.
To organise all evolving actions and activities in a coherent manner, a traditional project plan and scheduling approach works fine provided this is constantly QA’ed and reviewed and has senior support within the organisation.
The readiness plan will change over time as requirements and impacts change in response to new information from the RAs and the general business landscape but getting organised now will help minimise surprises.