The chief information officer’s role has moved beyond the simple provision of technology and is more about fulfilling business objectives, says Yahya Abdulrahman, Saudi Electricity Company’s (SEC’s) executive director of information and communications technology (ICT). A company’s technology department can add value even to the extent of becoming a profit centre itself, he says.

“IT is moving to be like a utility,” says Abdulrahman. “[The reason] we are moving to the cloud, why we are moving to services, is that when you connect your device to the internet, you can buy any kind of IT services and you pay for what you use. This will be the theme of IT in the coming five years, just like the utilities: power, water, or even mobile telecommunications.”

Buying services

Small-to-medium-sized enterprises and even some larger ones will buy services, rather than invest in their own IT infrastructure, says Abdulrahman. “The only thing they will need is access to the internet; access to the cloud. If the IT in my organisation is not ready to be in that position within five years, then we will disappear.”

It is an area that SEC and Abdulrahman are looking to exploit. The listed firm is the largest electricity provider in Saudi Arabia, with more than 6.3 million customers. Abdulrahman says SEC could offer IT as well as electricity services, with his department providing services not only to the utility, but outside the company as well. This would make it a profit centre, generating income.

Services would be of “any kind”, he says, from enterprise resource planning software, such as SAP, to systems and services for operations such as call-centres. It would mark a major departure for the firm away from its core competency of supplying electricity, but, according to Abdulrahman, would not be a dangerous leap into the uncharted waters of established competition.

“There is nobody yet in this area,” he says. “Since we are a big company, we have got all the strength.”

That shift could be a while off, however. For 2013, Abdulrahman says his investment priorities at SEC are security, mobility for field maintenance and smart phone services.

SEC has launched 20 new technology services for customers in Arabic and in English this year. It is also working with the US’ Microsoft to launch services on the Windows 8 mobile platform by the second quarter of this year, to add to Android and Apple operating systems. From the third quarter, employees will be able to retrieve their personal data remotely and make appointments at SEC’s medical clinics.

SEC has stepped up its investment in IT security following cyber attacks last year on Saudi Aramco and Qatar’s RasGas operations. “It has been realised that utilities are a target for cyber crime; the rules of the security game have changed now,” says Abdulrahman. “It is no longer traditional security attacks, it has gone beyond what we used to know. So we [need to have] agile security that can deal proactively with security threats, not only reactively.”

While reluctant to provide precise figures on his firm’s IT security spending in 2013, Abdulrahman confirms that industry estimates of a 20 per cent hike on last year is about right.

Abdulrahman says SEC’s capital IT investment will be about SR100m-150m ($26.6m-39.9m) this year, and its operating expenses about SR100m-130m. “We use capex [capital expenditure] mainly for building our infrastructure,” he says, adding that the firm does little outsourcing, preferring instead to develop its own assets.

Cloud strategy

Another priority for Abdulrahman this year is developing the company’s cloud strategy. Virtualisation of enterprise software will be 70 per cent complete this year, including the adoption of Microsoft 360. This service supporting email and documents is in the public cloud, but SEC is also building a private cloud, although that will not be ready until the end of the year. The private cloud will be a pilot project allowing SEC affiliate companies to access some of the organisation’s systems and services.

At the same time, SEC is working on a pilot scheme running smart electricity meters for about 60,000 major customers, which include manufacturers, retailers and hoteliers. The flexible tariff meters transfer load from peak periods to night time, particularly during July and August, when heat pushes up electricity demand. After 5pm, electricity costs less for these customers, who can charge their air conditioning overnight.

For all businesses, technology is becoming increasingly important and IT departments need to respond. “Historically, [the corporate world has thought that] technology people should stay away from business,” says Abdulrahman. “But they should understand what the business’ objectives, targets and strategy are, then you can have a partnership with the chief executive officer and the board.”