Where do Today's Electric Utility CEOs come from, and what do their Origins Mean for Grid Security?

I remember once thinking, naively perhaps, that most utility CEOs must have come up through the ranks, like generals in the military, with hands-on operational engineering experience garnering them the respect of their peers and subordinates along the way.

When I shared that concept last year with a 40-year industry veteran who'd done his time in generation and T&D, he schooled me saying that while that used to be the case, it's not the norm today.  He said more often you'll find someone with a finance background, often imported from sectors outside power.

Well, I got another round of schooling on this subject this week from former state commissioner and current consumer advocate Nancy Brockway, who has made her presence known on this blog before, in: "The State of the States and Smart Grid Security." Well she's back, and whether you agree with her or not, and allowing for exceptions, I think you definitely should hear what she has to say about the origins of senior utility leadership in 2014:

Transaction-oriented finance and legal sector professionals have displaced engineers in the executive suites of most utilities. The big shift to deal-making occurred in the wake of the existential shocks of the late 20th century over cost over-runs, the end of cheap oil, and the growing recognition of the environmental costs of utilities. 

Look back a century or more to the pioneers of the utility industry and you'll see a public interest value system that could and often did accompany the build out of utility territories and even accompanied mergers and acquisitions. Read 2004's Insull: The Rise and Fall of a Billionaire Utility Tycoon by Forrest MacDonald, for more background. 

But economies of scale were pretty-well exhausted by the 1960s. Bigger was no longer better for customers. And an anti-regulation "winner takes the hindmost" political climate did not reward a utility executive's greater effort to serve the public. Rather, it rewarded ever more sophisticated schemes to funnel profits up to the executive suite.

Regulators have to push for what they see as the public interest. To do their jobs with any responsibility in these circumstances, they can no longer sit back and merely act as a brake on occasional excesses. Too often they have to define the public good and demand it from utility management.

I am not sure that a workable redefinition of the roles and responsibilities of management and regulators can happen without a wholesale cultural shift away from "Greed is Good." My opposition to pre-approval of cyber security spending comes from the sense that if the utility drags its heels or does only what it needs to satisfy regulators, that just demonstrates that utility execs do not see security as fundamentally necessary for their personal financial success.

Sort of begs the question of how Gordon Gekko would weigh security investments vs. security risk, and you know what, I don't know the answer.  But we know GG types thrive on risk and reward. 

That's not exactly what I had in my mind previously, imagining conservative, retired military, former boy or girl scouts, with steady hands on the tiller of some of the absolute most important critical infrastructure organizations in the country.

Hopefully, experience and acumen with fine tuning financial risk/reward equations will most often translate to similarly savvy understanding of and action on operational risks ... including one that's increasingly material and the raison d'etre of this blog.

Photo credit: ABC news

Thoughts on "Risk and Responsibility in a Hyperconnected World"

Hat tip to Tim Dierking of Aclara for spotting and forwarding this January 2014 World Economic Forum / McKinsey report: "Risk and Responsibility in a Hyper-connected World." Tim pointed to a couple of excellent sections on cyber resilience and future scenarios which you'll find within, but I'm going to call out a different selection for your immediate consumption.

This below is taken directly from the McKinsey summary, which while not energy-sector specific, is right on the money, IMHO, on the culture, leadership and organizational dynamics aspects of what's needed to do security right in 2014+.  Here you go:

A CEO-level issue 

Given the trillions of dollars in play, the stakes are high. And given the range of social and business issues that cyber resiliency affects—for example, intellectual property, regulatory compliance, privacy, customer experience, product development, business continuity, legal jurisdiction—it can only be addressed effectively with active engagement from the most senior business and public leaders. 

Even improving cybersecurity capabilities within a single institution requires collaboration across a host of business functions. Operational managers must assess which information assets are most valuable. Privacy and compliance functions have to evaluate the impact of losing customer data. Decisions about how much to monitor employee access to sensitive data have major HR implications. And procurement must negotiate security requirements into vendor contracts. 

Given the scale of impact and the degree of coordination and cultural change required, progress toward cyber resilience requires active engagement from the CEO and other senior leaders. They have to make clear they expect the following:

• an honest, granular assessment of existing capabilities and risks, given their business model

• alignment on the most important information assets and a clear approach for providing them with required protection

• a road map for getting to a scalable, business-driven cybersecurity operating model

• a well-practiced set of skills for responding to breaches across business functions

Sustaining the pace of innovation and growth in the global economy will require resiliency in the face of determined cyberattacks. Only CEOs and senior public leaders can solve the problem, because of the strategic and organizational-change issues that need to be resolved.

And so continues the exhortation for senior business and government leaders to take more ownership of the security risk challenge.  It's not easy.  In fact, in the overly technical ways it's usually presented to them, it's overwhelming and way out of their comfort zone.

For the umteenth time: Security leaders need to meet them more than halfway by speaking plain-English business language and as much as possible converting technology and security risk into dollars and cents to be gained or lost. Clarity and persistence are the keys here, as there are no gold, silver, or bronze bullets to hasten the process.

The summary and full report can be found HERE

Cray Cray for Crayons

I usually prefer oil pastels over crayons, but have found a new love for these colorful and wonderful friends! 

Today as we watched these videos I was taken back to my first box of 64 crayons with the built in sharpener...can you smell them!?

Bunbun remembers when he first learned how to write his name using a crayon! It was a literary and visual masterpiece!

K-2nd have been learning overlapping, so we drew and overlapped crayons for 2 class periods until they had totally filled their page with overlapping crayons!

Then we made the smiling box! We started with the letters. Students drew the word Crayola very large across the top of the smiley, the drew a "follow the leader" line around the stick letters to make a bubble letter. Then we learned about value and colored each letter from light to dark using these three oil pastels

Then they glued the crayons on the back of a pre cut smile shape

 2nd Grade

 Kindergarten

These are some fun videos we watched today to get us excited about CRAYONS!!! 

Have you seen this arm?

 The Rainbow Loom is all the rage....and this art teacher couldn't be happier! In my 11 years of teaching, I have seen alot of fads, like the Silly Bandz a few years back...

Slap bracelets!

...and these that you might have had back in the day!

However, I feel like the bracelet fad has come full circle to the days when we would spend our time making hundreds of knots and figuring out the coolest fattest bracelets we could make! It was CREATIVE and required fine motor skills and concentration...that did not involve a Wii, Ipad, or PS4, we didn't even have YOUTUBE tutorials!!

I remember the kids on my street would all share string, and tie their strings to their toes while creating their bracelet masterpieces together!

We followed patterns, and LEARNED from our friends, then turned around and TAUGHT others (communication skills!) 

 

 The Rainbow loom is very technical and requires concentration and skill! I bought one for my daughter and could not figure it out. After spending a few unsuccessful hours on YouTube, I ended up getting a tutorial from a very talented fourth grader, Ainsley, at my school! This is her "cool knit kit" (b I still can't do it btw...I have tried...no bueno)

She even made me a RAINBOW Loom Rainbow UNICORN!!! How cool is that!!!

In this article about the Waldorf education it says

Teachers say knitting teaches skills children need to be good readers. The process of knitting is like threading a story. Kids are learning focus and concentration. They’re gaining fine-motor skills, needed for writing. They’re seeing patterns. They’re moving from left to right, the same way you read. They’re gaining confidence.

(Linda Lutton/Front and Center)

Puppets crocheted by third graders at the Chicago Waldorf School.

“I think I’m really good at it,” says 7-year-old Julia Scott. “I can go really fast. And I can do it without looking.” As she knits, she tells herself a little story to narrate the complicated movements of her fingers, the yarn, and the needles:  “In the front door, around the back, peek out the window—out jumps Jack!”

Teacher Claude Driscoll says the goal of the little rhyme is to create a picture in kids’ minds of what is happening as they form each stitch.  And, she says, creating a mental picture is a skill used all the time in reading.

Amazing article

I am happy that my students are "knitting" on their rainbow looms and would love to have one for each student in my classroom and let the students teach the class!! Oh, and if you are one of my students and you are reading this, Bun Bun said he wants some bracelets, who's going to hook that up?? 

Brio Art Contest

Last night we had an Art Contest Reception at Brio Tuscan Grille. It was such a nice evening and the kids were SO excited! ALL the fifth graders did a fabulous job on their artwork! Thanks to Brio for hosting such a beautiful event for us!