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Navigating the digital transformation: water utilities’ challenges in low & middle-income nations

About the blog

Jean-Martin Brault
Senior Water and Sanitation Specialist, Latin America and Caribbean Region, World Bank

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  • Navigating the digital transformation: water utilities’ challenges in low & middle-income nations
    Jean-Martin Brault en el Spain Smart Water Summit 2024.
    Credit: González-Cebrián/SWM

Digital transformation is already everywhere, and for water supply and sanitation (WSS) utilities in low- and middle-income countries (LMICs), the journey towards digitalization is fraught with challenges that need to be addressed to unlock the full potential of digital solutions. It is thus crucial to understand and communicate how they can work for these utilities, as well as for the water cycle they depend on.

A clear vision of the resources you need…

Most WSS utilities in LMICs have yet to embrace digitalization in a strategic way due to several factors such as lack of skills, knowledge, and financial resources. When asked what they saw as barriers to the adoption of digital solutions, LMIC utilities mentioned the lack of budget (23%), the lack of skills and knowledge about digital solutions (18%) or the lack of a clear return on investment (13%). Utilities worldwide may share business priorities and expectations about the digital realm, but dedicated human and financial resources will be key to accelerating digital transformation.

Digital transformation requires a workforce equipped with the necessary skills and knowledge in information and communications technology

Digital transformation requires a workforce equipped with the necessary skills and knowledge in information and communications technology (ICT) – not only to operate and maintain new technologies, but also to hold its end of the conversation with external actors who can deliver technology and support implementation, ultimately leading to the effective execution of digital projects. However, many utilities in LMICs face a shortage of skilled ICT personnel, and these same key ICT individuals are often not in leadership positions: most digital initiatives are confined to the ICT department, limiting the mobilization of resources and the integration of digital solutions across the organization. In addition, more than 2/3 of LMIC utilities have yet to formalize their digital vision. Without sound strategies and digital roadmaps matching their business priorities, LMIC utilities will continue to struggle with steering the digital transformation boat. Anchoring digitalization high in the organization will help avoid fragmented efforts and provide a solid basis for the promised digital benefits to be reaped in a timely and sustainable manner.

…and the risks you face

As the digitalization of WSS infrastructure and services increases, so does their exposure to the inherent risks and vulnerabilities of cyberspace, and in LMICs, these risks are compounded by the lack of awareness and training, as well as by the limited resources available to invest in cybersecurity infrastructure. When asked how they handled cybersecurity, 35% of LMIC utilities either had basic processes and policies in place or had limited resources to go beyond an antispam or firewall. This underscores a pressing need to support utilities in incrementally strengthening cybersecurity to safeguard against potential disruptions that could compromise the services they deliver, through international collaboration, investments in cybersecurity and tailored capacity building initiatives.

 The need for a comprehensive approach

To address these challenges, a comprehensive approach to digitalization is needed, including identifying the utilities’ current level of digital maturity and developing clear digital strategies to tackle current and future priorities. Practical tools can help utilities navigate the digital ecosystem and keep pace with the evolving landscape of digital technologies, and recognizing that the sector needs to prepare for a long-term transformation will be crucial to securing leadership and the required financial resources to do so.

The digital transformation has firmly started in LMICs, and, while the journey remains complex, these utilities are certainly “byting” their way every day into these challenges, and we have a great deal to learn from them, regardless of their level of maturity!

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