Respond. Rethink. Resolve. An IPS Podcast
Respond. Rethink. Resolve. An IPS Podcast is a customer-focused thought leadership series that explores real-world power and reliability challenges through conversations with IPS leaders and industry experts.
The podcast is designed to provide practical insight into the issues customers are facing today and how they can be approached from a system-wide, lifecycle perspective.
Respond. Rethink. Resolve. An IPS Podcast
Rethinking Reliability at Scale
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This first episode focuses on the growing strain on power infrastructure, with specific relevance to utilities and Engineering, Procurement, and Construction (EPC) firms and Electrical Contractors (ECs) managing increasing demand, aging assets, and resource constraints.
The conversation explores how reliability must be approached differently at scale, moving beyond reactive fixes to more integrated, lifecycle-driven solutions.
It sets the foundation for the series and introduces how IPS supports these challenges through a Respond. Rethink. Resolve. approach, positioning IPS as a partner in solving complex reliability issues.
Thanks for listening to Respond. Rethink. Resolve., a podcast from Integrated Power Services. Follow us on social media:
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Intro
John ZulegerWelcome. I'm John Zuleger, President and CEO of Integrated Power Services, and I'm delighted to welcome you to our first podcast, the Integrated Power Services Respond, Rethink, Resolve Podcast. What our intention with this is to invite guests and discuss and explore some of the latest trends going on in our world of power generation, transmission, distribution, protection and control, and of course with driven equipment, electric motors and generators. All of these processes and products are the types of processes that integrated power services involve with driving reliability strategies and supporting our end customers' operations on. And so this is our first episode. In the future, we expect to talk to more leaders of IPS as well as customers and really investigate what's happening with trends, what are some of the strategies we're seeing from end users and the role IPS can play in assisting our end customers with reliable operations. Our first guest today is Hannah Kaplan. Welcome, Hannah.
Hannah KaplanThank you for having me on the podcast, John.
John ZulegerHannah is our chief commercial officer in the power management division of IPS. In this role, she's responsible for all the sales and commercial strategies, especially for some key end markets, such as utilities, data centers, and contractors. So really looking forward to talking to you about these trends, Hannah.
Hannah KaplanExcited to dig in, John.
John ZulegerWe're seeing a lot of massive investments,
Power demand growth & challenges
John Zulegerparticularly in North America, around some of these power-related infrastructures. And the uh estimates on the total amount of capital being spent uh is in excess of $1.1 trillion. So, you know, I think there's a lot of stress emerging at our customers. We can hear it and see it around really extraordinary demand uh that they're seeing, like well beyond what they've seen over the last several decades. So that's obviously got to creating, be creating challenges. So, what are some of those challenges look like that you're hearing from customers?
Hannah KaplanYeah, I mean, you noted, John, we're in an incredible investment cycle that the utility sector has never really seen. Um, we have customers who will double in size in the next five years from the infrastructure they've built in the last hundred. Um, you know, historically we've talked about the energy trilemma. So affordability, reliability, and um decarbonization. Um, but really now a lot of these electric utilities are adding tremendous load growth to that trilemma. And what that really means is huge amounts of capital investment in generation, transmission, and distribution, but also a need to upgrade the existing grid, meaning it's not reliable enough and it wasn't built for distributed generation, for electrification, and for variable loads like data centers that they're experiencing right now. Um so, truly, our role as IPS is understanding these um needs, these investment cycles, and how we really help de-risk and provide supply chain resiliency to these customers who are just um seeing unprecedented demand on their services.
John ZulegerSo, considering this, Hannah, when you look at a situation where a lot of these generators have had very low demand growth for a couple of decades, they've probably taken a lot of decisions to not invest in maintenance, right? So they're coming out of a prolonged period of maybe not keeping up with some of the reliability uh strategies that would now serve them. And the demand growth, what are we talking about? What kind of factor increase in demand growth are we talking about that that they're seeing?
Hannah KaplanYeah, absolutely. I mean, on the first question, absolutely, the there's been a lot of delays in OM investment within the utility sector. Um, one because of affordability, really trying to keep energy costs low, both for you know residential, but also for industrial and commercial customers and to incentivize that growth. So, what that ultimately means is we have aging infrastructure, aging facilities, often without the latest and greatest technologies. Um what that means is a lot of unrepaired equipment, right? And a lot reaching or beyond the end of its useful life. And as you add load growth on top of that, and to give a sense of a magnitude, you know, with some of the data centers coming in, they're adding Manhattan-sized loads to areas that have had low to no growth. Um, that just taxes that infrastructure even more because they're coming onto an age system requiring additional generation and then providing loads that are not stable base, but really variable, which puts even additional stress on the grid. So that confluence is truly requiring utilities to plan differently and to invest differently and look at the life cycle of their equipment in a much, you know, more speedy and integrated way than they ever have before.
John ZulegerYeah, I've read I've read some data. I just want to check these with your understanding. You know, when we look over the course of, say, call two decades, load growth has looked like something like less than 1% to maybe 1% over the course of that period of time. We're talking projections now out to 2030 of like 5% load growth. So, you know, when when you talk about that order of magnitude, what happens? I mean, does that test the weakest equipment and the and the most under maintained processes?
Hannah KaplanYeah, for sure. I mean, it's not that industries weren't growing before, but all of that growth was really offset by energy efficiency, right? If you look at the efficiency gains on the demand side, uh pretty consistently, whether it was lighting, whether it was automation, whether it was efficiency of equipment like motors and others that we have expertise in, that was offsetting a lot of the load growth. But now, because of the magnitude of these load additions and not just data centers, but also industrial reshoring, also electrification of vehicles and general electrification of our lives, you think about the phones and all the things that we didn't have in the past, as well as new technologies that are coming to market, um, hydrogen, ammonia, all these fuels that are creating new demands as well from a generation standpoint. Um, so ultimately, yes, it does cause power quality issues, right? There's a relationship between the demand side and the supply side of the grid. So that creates noise and can potentially cause major shutdowns that can cause millions of dollars of impact into existing customers for utilities. And uh data centers just exacerbate that with the expense, as we know, of chips and of the surrounding equipment in a data center, you really don't want to make sure you're protecting from voltage drop and other um potential sources of damage to those buildings. So that's really
What is the utility super cycle?
Hannah Kaplanum a unique requirement right now.
John ZulegerFrom that vantage point and coming into IPS, as you talk with customers throughout the industry, how do you see this utility EPC super cycle shaping priorities and affecting the whole energy stack?
Hannah KaplanYeah, absolutely. I mean, historically, utilities have partnered with EPCs on very discrete projects and have balanced, you know, their own in-house capabilities with EPC fulfillment. And as these investments are reaching, you know, multi-billion dollar investments, that partnership is becoming much closer. Meaning utilities, EPCs, electrical contractors, they're managing huge multi-billion dollar projects over many years together. And they're looking to partners like IPS to ultimately be a trusted advisor when it comes to the total supply chain for these projects, all the way from the initial engineering and design, all the way to okay, how do we make sure we have the right parts on hand for the critical path of the project into the life cycle management of assets, whether it's transformers, switch gear, generators, even down to the motors within those generation facilities, that really they're trying to extend the asset life as long as possible because some of these supply chains are stretching out so much for this critical equipment. And so, really, IPS becomes a unique partner in that we're playing across that entire electrical value chain across the life cycle. Um, but ultimately, you know, what we're hearing from customers is we need more partners that can really take a systems view with us.
John ZulegerAnd so when you examine some of the uh constraints that are involved with this super cycle, you know, what we're definitely hearing is equipment and supply chains, some long lead times, right? So, what's driving those long lead times? And, you know, what makes IPS an option, you know, if if you're in need of equipment as it relates to your project plan?
Hannah KaplanYeah, I mean, you you hit on it earlier, which is the investment in some of the repair and replace historically has been pretty conservative, especially in North America. Um, and so those supply chains simply were built out to support a much lower demand. Now, essentially, you have data centers, industrials, and um utilities all competing in the same supply chain for transformers, for switch gear, for motors, et cetera. And so ultimately the supply chain just has not been able to catch up. And there's a lot of build-out of facilities. Um, but ultimately it's who can get there first. This is really a game of the fastest one wins. Um, we're seeing that with utilities, the faster they can get generation online into the customer, they're gonna win that load. And equally the data centers, they're gonna be able to develop better products if they have the power for their compute. So it really is a game of speed in a market where the supply chain isn't keeping up.
John ZulegerYeah, it's been interesting, right? Because I think we exited the you know, COVID uh-driven supply chains and where a lot of this equipment's uh you know, manufacturing path was really global in nature and had been created that way, you know, over 30 years or many, many years. And so COVID, I think, really enlightened folks around, hey, you know, we didn't factor in this risk, right? When they decided to set up their supply chains that way. But that would have been one thing. But now there's another thing because of this super cycle. So, what makes this so unique? Why is this called a super cycle?
Hannah KaplanYeah, I think ultimately it's the confluence of the load growth, the data center and AI boom, and the fact that we do have such aging infrastructure that cannot stretch into this demand as quickly as possible. I mean, there's actually a lot of redundancy in our electrical system, um, and built rightly so. Um, but it's not enough to really deliver quickly and reliably for those variable loads, right? Ultimately, our electrical system is built for those few hours in the year where you really hit that peak and you don't want to be out of power, right? For a lot of good reasons. Um, but the super cycle is coming from trillions of dollars of investment that really are flooding into the data center space, the utility space, the general power gen space in ways that it just hasn't historically. And um, that's creating both really rapid development and creativity of solutions, which is really pretty cool. Um, but also means that the amount of capital that's being spent is not being met with the right supply chain, right? So ultimately the limitations on data centers and AI is power right now. Other, you know, everything else is pretty much there in terms of the technology.
John ZulegerAaron Powell Yeah, and it's it's quite amazing to see it because it's not just the equipment, it's the key components in the equipment, the parts, the pieces, the raw materials, the copper and critical minerals, right, as well that are experiencing the constraints from that super cycle.
Hannah KaplanAaron Powell That's right. I mean, the mining industry, for example, as we've seen, um, has had a huge boom as it relates to copper, and copper prices have been um extremely elevated for a while, which is also driving the cost element when we talk about affordability. Um, and that's that's a huge part of this capital super cycle is how do we also keep power affordable for residents and around the country and um in parallel meet the demand,
Skilled labor shortages
Hannah Kaplanwhich requires a spend.
John ZulegerThe other significant constraint around this episode of supercycle is around labor constraint and especially skill craft. So as you talk to customers, how does that play out, whether it's EPCs or utilities, are they seeing this labor scarcity? And when we look at the services IPS provides, you know, what can we offer those customers in that situation?
Hannah KaplanYeah, absolutely. The answer is yes. The answer is labor is absolutely front of mind. And more than ever, utilities are really looking to outsource quite a bit of that labor, whether it's to EPC's electrical contractors or companies like IPS. I mean, what's very unique about IPS is we have one of the largest uh Nita Tech, as you know, populations in the country, as well as you know, huge skilled technicians into Canada, into the Caribbean, and even into Europe, right? And that unique capability is going to be required because simply put, utilities don't have enough talented labor within their four walls. Um, and so more than ever, they're outsourcing, right? And that's often to EPC's electrical contractors, or they often consider us, right, their direct contractors, providing that skilled labor, being able to test and be part of that installation and commissioning cycle, um, as well as in
IPS is a utility lifecycle partner
Hannah Kaplankey outages.
John ZulegerSo, Hannah, we've touched on utilities. Where is IPS creating the most value for utility customers today?
Hannah KaplanYeah, I mean, we talked a little bit about the CapEx cycle, but in reality, um, a lot of what we're doing today to benefit utilities is around their operations today, right? When we think about a power transformer, for example, we are supporting, you know, the full life cycle from you know installation commissioning to overhaul to in-field service on power transformers across North America. Um, and it's we have really unique capabilities across the country to be able to serve utilities, um, whether it's you know, rewinding with different materials. So we talked about copper, aluminum, um, but also doing you know, capital exchanges, right? Those programs are really important for utilities to be able to achieve their goals. One, to be able to get existing assets back into operation as quickly as possible, but also to do one that really fits their business model and their needs. And so what's really exciting is the kind of partnerships that we're getting into with utilities on their life cycle, which is not just looking kind of on a break fix model, but like long-term asset management type of programs. Um, and more and more utilities are moving in that direction, right? Not want wanting to be less reactive and more preventative in their strategy and working with partners like IPS that have the footprint and the capabilities to do it.
John ZulegerYou know, I I keep reading about interconnection queue. And, you know, as I've learned more about what's going on there is the gap between generation and low demand. And I think I've read like there's something like 8,000 or 10,000 miles of high voltage lines that have to be uh connected. So when you when you think about what we can do for utilities at Substation and some of the services around that, what does that look like? And how could that help them as they address their interconnection
Substation-level support
John Zulegerqueue?
Hannah KaplanYeah, I mean, it's interesting where the loads were coming before versus now, right? Historically, where data centers were popping up, it was largely where there was a really healthy fiber optic network. And typically the grid was there. There were substations available and they were able to pretty easily co-locate with substations. Now, because of the sizes of these loads, they're really locating where there may be no grid interconnection, right? And so our ability to do, for example, mobile substations, to have that quick ramp and do kind of a bridge power solution until the grid can sustainably reach and build out, you know, permanent substation infrastructure as well as high voltage lines. Um, and typically these loads are right off of the transmission system. So there's not even a need to build a distribution system, but it just takes time. It takes years to work through right of way and all these different pieces, on top of working with the ISOs typically, um, to be able to get approvals to connect these customers to the grid. So it's truly a multi-stakeholder challenge. And our ability at IPS to be there kind of from the beginning of the need with temporary or bridge power solutions, all the way to helping with accelerating the build out of the permanent infrastructure, meaning what transformers you need, what switch gear, what generators, what motors. Um, it's that short-term, long-term value that we can bring.
John ZulegerOkay, Hannah, everyone's talking about data centers. Um, and it's
Data center lifecycle support
John Zulegerreally quite a phenomenon. It is an amazing opportunity. I mean, markets are being made uh, you know, with the the pace of investment going on, um, but it's also creating a lot of stress. It's stressing both the generation side, it's stressing, you know, the grid, the connectivity. So as we look at this phenomena as it relates to utilities and data centers, how they're getting interconnected and what the effects of the pace of growth, what are we seeing and what role can IPS play to help the players?
Hannah KaplanYeah, absolutely. I mean, you know, data centers aren't necessarily new, right? Companies have owned their own data centers. And about a decade ago, cloud data centers were popping up at much smaller scale. Um, but there were similar discussions about how to support the growth at that stage. What's really different now is the explosive growth of 500 megawatt, gigawatt, multi-gigawatt data centers. Um, that's representing growth that, frankly, utilities just have in North America at least have not been expanding at that rate. Um, and so ultimately it's presenting just a pure project management issue, meaning there aren't that many people sitting at the utilities who can manage this many projects. So they're having to ramp up in terms of their, you know, engineers, project management capabilities, um, and also the contractors that they need to use to be able to build out infrastructure and actually putting embedded teams into their own teams to expand their workforce. Um, but also with the data centers, which essentially, while they're partners, they're also competing for a lot of the same talent, whether it's electricians or mechanics or just you know, welders and others who are building out, you know, the buildings and the power plants and the transmission distribution lines that are necessary to serve the grid. So it's a really unique opportunity and challenge because as we've talked about, it's you know, equipment, it's labor, it's services on that equipment. Um, and it really all has to line up at the same time because inevitably the data centers want to move as fast as humanly possible to be able to build out their business cases on the AI products and services side, whether they're optimizing advertising or whether they're you know helping us use Chat GPT for our own productivity reasons. But on the flip side, you know, the utilities have had to move really historically slowly with approvals from commissions and really being intentional about the cost that they were adding to the grid. And so that's creating a unique partnership between data centers and utilities and ramping. Um, and the space for IPS is really on both sides of the fence, meaning, how do we help accelerate and optimize that build-out of the power grid and the transmission distribution and uh generation side, but also how do we help data centers in their project management and really reaching their goals from a timeline quality safety perspective? Um, and so it's it's kind of a fascinating codependency. And more and more we're hearing, you know, the one limitation to data centers right now is power.
John ZulegerYeah, it's interesting, right? Everyone wants to talk about speed operations. But I also think it's gonna be interesting to see what happens with ongoing maintenance. I mean, how long do these data centers have to be reliably reliably up and running? What is the target uh uptime rate?
Hannah KaplanYeah, I mean, most data centers are signing 10 to 15 year power purchase agreements with utilities. So that's giving you a bit of a sense of what they can forecast in terms of their operations and their demand. What we're Seeing, and and we're feeling this most on the field services side, is a lot of the equipment that's putting out and put out in the field right now is showing up not even completed, right? And that's some of that is coming from the supply chain pressure on OEMs and generally just equipment suppliers who don't have the time to finish the product in the and still hit their timelines. And so they're shipping it out to be finished in the field. And as we all know, who those of us who've been in the manufacturing sector, that is not an optimal place to complete, you know, OEM equipment, right? Some of that really ideally would be happening in a controlled environment in a shop. Um, so our expectation is that there's gonna be a lot more challenges with that equipment, a lot more need for service and upgrade. Um, and so we're really gonna be ready to meet that challenge as it emerges. Um, and also present ourselves as a viable alternative with kind of the modular options that we can present as an alternative to these kind of half-done options that are showing up today.
John ZulegerBecause the, you know, the aftermarket needs on that equipment, again, I agree with you, it's showing up. It wasn't made in a climate control factory. It's showing up some of the switch gear, 75% completed. And our commissioning electricians are doing last mile manufacturing completion, right? And so, like a piece of equipment which was engineered and designed to be manufactured in a controlled environment for a 15 or a 20 or 25-year equipment life is likely going to see not only a shorter life, but it's likely gonna run into, won't it, parts and component failure as well? How could we help if customers start to see that?
Hannah KaplanYeah, I mean, the first the first immediate need is typically if on an emergency basis, right, we on the IPS side have really focused on what componentry do we need to have on the shelf to support our mission critical customers, right? And we've built more and more sophistication, knowing what those needs are and how we keep that critical equipment on the shelf, right? So there's kind of that emergency option that we are that first and only call that's needed once an issue comes up. Then more strategically, and something we're talking to more and more customers, is let's plan for the unplanned, meaning let's look at what your potential areas of vulnerability are, and let's put together a program on how we can support that potential longer-term need. And I think that more and more is the conversation that these customers want to have because we have the expertise as it relates to what electrical equipment is likely to fail. Our hands were on the equipment. We're seeing how it's coming out of the shops. Um, and so that's a unique perspective that only IPS can provide in terms of the state and the potential failure
EC & EPC partnership
Hannah Kaplanmodes of that equipment.
John ZulegerOkay, Hannah, let's shift the conversation and talk about EPCs and contractors. I mean, they're under a tremendous amount of speed, uh, speed to completion, uh, commission pressure from end customers, certainly in data centers, but not only there, right? Uh contractors are are working across a variety of industrial, you know, and markets dealing with both supply chain and labor scarcity and pressure. So uh when it comes to contractors, what's the best use case of for them of IPS's services?
Hannah KaplanYeah, I mean, it's it's interesting. And to your point, electrical contractors are being stretched in, similar to the supply chains that serve them, meaning there's huge demand for their capabilities and expertise. Historically, electrical contractors have come to IPS because we've just been more competitive than a lot of their alternatives, meaning our lead times have been better, the quality of our work has been superior. Um, and we really act as a partner with them over time, where they know when they call, they can count on us in terms of rapid response, um, ability to understand their challenges and ability to deliver. Um, that is just compounded by the current environment and the number of projects that they're managing. And so ultimately, electrical contractors are looking at us as their competitive advantage, right? We are truly a competitive advantage to customers like electrical contractors who are measured on their ability to meet a timeline, their ability to maintain cost and manage costs through the cycle of a project and deal with surprises, right? A lot of these projects, there will be a push and a critical piece of equipment, and they simply cannot wait. They need to find an alternative on the model. And our breadth and depth in IPS is unmatched in terms of whether it's something that we have on the shelf. We work across all OEMs, we work across many different electrical components, you know, from the component level all the way up to the systems level. If you think about some of the motor control centers and some of the bigger e-houses that we build down to specific switchboards, specific switches. Um, you know, it's really that unique ability to play across from the component to the bigger solution to the system model that we can play. And that is so critical for electrical.
John ZulegerThat's interesting, right? I mean, traditionally was the case that contractors would pour a
Modular solutions allow scalability
John Zulegerconcrete pad. It would show up the construction design and project plan, all happen out there on the pad. But now there are these emerging modular construction configurations. So, you know, how does that play into what we can offer? And I presume they're doing it for speed.
Hannah KaplanYeah, it's a combination of speed and labor availability, right? So that ability to build a modular solution in a shop then avoids the need to have similar integration out in the field, right? So that gives you, to your point, a speed component as well as the need to or the ability to deliver it without really expensive labor in the field to do that final construction there, especially when we're talking about remote locations. Um, but really, electrical contractors are looking at modular as a way to create repeatability in different projects. And, you know, it's a quality control measure for them when they're working with a specific manufacturer, as we can manufacture e-houses or switchboards. It's that repeatability and that scalability that they're looking for. Because in the end, these projects are requiring, you know, hundreds of millions, if not billions of dollars of equipment. And they really want to look at how do we get a repeatable quality item well tested out in the field?
UL certification for manufacturing
Hannah KaplanWe know it's just gonna work.
John ZulegerWe we've recently, haven't we, achieved UL certification for low voltage distribution solutions? That's right. What does that look like? Like what types of capabilities for manufacturing new equipment are we gonna be able to offer with that?
Hannah KaplanYes. I mean, ultimately the UL certification allows us to operate as an OEM to provide new solutions to the market. So not just remanufactured, but truly um newly produced, which gives one, from an insurance perspective, an additional layer of protection for that equipment. And typically new data centers and um and new utilities, you know, utility equipment requires new. And so ultimately that allows us to serve more on the capital side of the market, which is really critical because that's where a lot of the investment is needed right now. Um, but I would say also, even for some of our industrial customers who maybe were more hesitant to use remanufactured equipment, this gives us that differentiation to say you have the option of remanufactured and benefits from a lead time and cost perspective, but you also have the option to come to us for new, and then we can provide all the services and you know field work attached to that.
John’s IPS journey
Hannah KaplanSo, John, you know, you've been the CEO of IPS for over 13 years now and have been building this tremendous portfolio really with life cycle positioning and aftermarket service positioning. You know, how how did this come to fruition and how did you keep it consistent across the products and services and just broader offerings that you brought into the portfolio?
John ZulegerSure. Yeah, God, 13 years, really, you gotta remind me of that, huh? Um, actually, it's been a a privilege uh and a highlight of my career to be an employee of IPS. Uh when I came, I found at IPS uh a decided orientation to repair electric motors and rotating equipment. Uh that was the lead mission, and it dominated everyone's conversation when I asked them what we do well. And we did do that well with a long OEM heritage. Uh but what I was interested in is, you know, what else do we do well? And why don't we do it more at other locations? And so that led to uh a real recognition where it was being done at the best level that field services, you know, where our employees go out full-time and spend time behind our customers' uh fences, and the sale of new uh electric motors and generators. So because we're behind fences or because we have their equipment and it's failed, uh, we know if they need a new one or if they'd like an option. So as we looked at these other services, we started to see the complementariness just of having a broader offering to them. But what really evolved was this life cycle management aspect. And that came together when we added critical asset storage. So, in other words, we started increasingly getting the critical spares and keeping them in warehouses in proximity to their operations. And I always love to tell this story because it's where the magic really started to happen, where, for example, an electric motor fails. We get the call at 3 a.m., usually on a wedding weekend, and our grade technicians go out to the warehouse, pick up a spare, put it on our truck, go to their site, decommission the failed motor, commission the new one to get them back up and running, put it on the truck, bring it back to our repair operations, repair it, put it back in storage, and we put our hands on it once a month to make sure it's ready to go. And that's where two things happen. Number one, that's true life cycle solution sets. Um, it's also really where our mission was really born of respond, rethink, resolve, because you know what it permitted us to do is really understand these chronic failures and kind of why is this happening to you, right? We've also had a very large engineering intellectual property platform and talent base to help with some of these problems.
Hannah KaplanSo, John, you talked a lot about the build-out of the electromechanical business across IPS and adding the distribution business, the storage business, and really having that um full lifecycle
Expanding into power management
Hannah Kaplanoffering. How did that translate into the growth of the power management business over the last four or five years?
John ZulegerYeah, I so my awareness of power management goes back um eight years as a potential service adjacency. Uh, and it comes out of conversations we had with reliability engineers. So at some of our industrial customers, the reliability engineers that were responsible for the electric motor drivetrain, we asked them in 2017, hey, are you responsible for the electrical balance of plant? In other words, you know, the transformer, switchgear, breakers, relays, variable frequency drives on the front end of the electric motor. At that time in 27, about 50% that we surveyed said, yes, I'm responsible for some of that stuff on the front end of the electric motor. We did it again in 22, and 50% became 80% with COVID retirements and other, you know, baby boomers retiring with a lot of knowledge. So I think our interest in going into power management was this recognition of a need that the people who thought of us as a trusted advisor for the electric motor, it certainly was emerging that this was going to be a challenge for them to maintain more and more span of operation. And so then it became okay, how do you build a business uh with the right amount of services? And so it's very difficult to do something like this organically. It can be done, but it's very difficult to do and it takes a long time. So we decided that we needed to find uh, you know, a path that would involve acquisition, not just to find a partner who could help us finance and and provide equity for that, but also to build a capability to identify the right kinds of businesses to acquire. And so what has happened over the course of 54 months and 15 acquisitions is we've built a broadline, you know, aspiring to be lifecycle power management services business. And it has many of the same attributes as we saw on electromechanical. It's not as repair driven, it's more field service driven. Uh, it is more remand, you know, driven as well. It is more pure distribution, both of new and surplus equipment as well. But the ability to do this for, again, those categories, transformers, switchgear breakers, et cetera, you know, what we've been able to acquire is in this service geography, say 200 miles, we brought one or two of those services into IPS with that acquisition. And then we'll acquire another and acquire another. And where I think the real value to customers emerges is when we can overlap those service capabilities in overlapping geographies. And uh, it was interesting. I was uh at an open house where there were about two dozen customers last week, and I just asked an open question to everyone there. Uh, you know, I had taken them through our power management and electromechanical service offering, and I asked them, just show of hands or just blurt it out like how many suppliers are you requiring? And the customers were steel mill and paper mill and uh oil and gas pipeline. And it turnout on average, they said about six to twelve, right? So when I look at what we have now built, and you know, I wish we were in all the geographies we'd like to be, we're not. Uh so that continues to be an aspiration, but I think we're on to something because I I think they can see the value of a okay, if you can really be the trusted advisor for that span of equipment and you can do it in my geography in an overlapping synergistic way, yeah, it definitely
Field-service-led strategy
John Zulegermakes my life easier. Okay, Hannah, let's talk about the future. Um, it may be hard to see from here just with the velocity of change going on, and I'm sure there'll be a couple of surprises along the way. But as you look out, say over the next, you know, three, four years, how can I continue to help and support utilities and APCs?
Hannah KaplanYeah, I mean, when I think about our strategy, it's really a field services-led strategy, meaning it really starts from the field in and looks at that total lifecycle need of the customer. Um, and when it comes to utilities, there's going to be more and more needs to have our teams have the hands on their equipment. So I think planning for that capacity, as you said, and the geographies where we're strong and they're strong is really where we find the synergies. Um, and the good news is we have footprint in a lot of the areas where utilities are experiencing huge build-out. If you think about Colorado, if you think about Texas, if you think about Ohio, if you think about along the eastern seaboard and the southeast, there's just huge demand and growth with some of our biggest utility partners. And we have the field services footprint as well as the equipment and in-shop repair footprint. Um, that's just going to be a real game changer in their growth. Um, so first is just being at the right place at the right time. Ultimately, I think it's about building bespoke product and services solutions for them as well. Is we understand the operations of these customers. And in parallel, we want to work in partnership with them to bring to market really the solutions that they need from an equipment reliability standpoint. Um, and that could be new technologies, um, looking at extending the asset life, which we're looking at in Transformers and Switch Gear Today and Motors, as you know. Um, but also looking at business model innovation, meaning how do we fit to their business model in the best way with you know, exchange programs, um, with different kinds of storage options, um, and really getting, you know, more creative in our supply chain strategy working with them. So I think the future really holds a much more strategic partnership along the lines of being that trusted advisor. Um, and it's really going to go along, you know, geographic products and services and um kind of outcomes lines ultimately.
John ZulegerI I like what you said about being field service led. I certainly agree. And what's interesting is what they're calling, you know, the war for talent. And uh at IPS, we have you know well over 800 full-time field service techs. So as it relates to future needs and and challenges they're gonna face, what could that look like for them in terms of IPS's ability to, you know, bring that talent to a project, to a location?
Hannah KaplanYeah, I mean, I think IPS has taken a really unique approach to technical talent, which is looking at the overall, you know, not just the employee value proposition, but really the career pathing around those technicians and how we support the growth and development of that talent, whether it's into leadership roles, project management roles, um, more even commercial roles, because we welcome, you know, former techs on the commercial side. Little advertisement techs make great sellers. Um, but ultimately it's really about um how do we bring the greatest talent in that really knows how to serve the customer, really shows that servant leadership and responsiveness, right, to the theme of um this podcast and people who really are
Talent growth and development
Hannah Kaplangonna grow and develop at IPS, which is why they want to stay here.
John ZulegerYeah, I I really think that's gonna end up being the differentiator for all players providing services like we do. And um, you know, I I think at the end of the day, it requires a serious commitment from an employer, you know, to build a training capability uh that can, you know, help people that want to, you know, develop their skills do that in a progressive way. And, you know, to me too, I mean, I always say, you know, I get to choose where I get to work too, just like anybody else here at IPS. And um, I think there's so much that should go into an employee's decision of who they want to work for, right? And and so, you know, for from our vantage point, we really want you know, employees to look at building an entire career and never leaving IPS. Yeah. Um, that's a big aspiration. Uh, but I think we're at a point where we have no other choice. It's just getting harder and harder to find, find talent.
Hannah KaplanYeah. And I think part of that is, you know, how do we attract people into our industry through, you know, what the excitement that you and I feel about this growth over the decades to come and really laying out, you know, that vision of what it means to be part of this industry, right? And and kind of the excitement that comes with, you know, serving at the front lines of it and also the growth that that provides because it's such a unique perspective being behind the fences. And it really is, you know, it's the point tip of the spear for our business to really understand those customer needs and how we serve them.
John ZulegerI I totally agree. You know, when I talk to our employees and our technicians, what they enjoy about their work, what's often cited is either, you know, just the problem solving, you know, but especially they have a deep need to help customers, right? And get them back, get them out of the ditch, you know, get them, you know, back operational, right? And it's interesting to see the relationships that our employees build directly with our customers, where they're like, no, no, no, I want Hannah to come, you know, on this job, you know, have to have her. And so uh, you know, that's certainly uh more than the company. That's great employees that are totally dedicated to delivering for our customers.
Hannah KaplanYeah, you nailed it. I mean, it it really embodies that unmatched customer experience. That's a big part of who we are as IPS. And, you know, I love, I love how you put that that's really what our employees wake up and want to do, you know. Across the board is deliver that unmatched customer experience. And it's getting that trust and getting that call when really the operations are on the line and we want to be that first call. So, John, given our discussion
Defining Respond. Rethink. Resolve.
Hannah Kaplantoday and really our your outlook on our markets, as we talked about, how do you think the IPS mission ultimately serves what's going on today?
John ZulegerYeah, I mean, when we think about our vision, it's to really revolutionize reliability. Our customers are thinking every day about how to stay up and continue to operate. And our mission is a simple three words of respond, rethink, resolve. To us, these are three very important action-oriented words that align to their current and future needs. First, with respond, I'm amazed at the talent of our technicians. But I'm also amazed at their willingness and ability to get up at 3 a.m. in the morning on wedding weekends. And for those that have families and partners who realize they get the call, they've got to go. So I think the respond aspect of our mission is very, very important and extends beyond just our employees to their families. I think rethink is really about who else does this? You know, when you look at the uh power management business we've been able to build, you know, over 13 years, it spans these services that are required for life cycle management and power management, but they also extend to electromechanical, uh, electric motors, generators, variable frequency drives. And, you know, our rethink comes from why is this happening to you, right? Like for a customer, you seem to have this chronic reliability problem. Let us help you think about that because we can look in a much more broader perspective at the problem, whereas some other service providers just finish at the electric motor and really can't help with the electrical balance of plan and resolve, right? We we love to problem solve for customers. And, you know, that ability to make it so that they don't need us is okay. You know, I think at the end of the day, what they want is, you know, that trusted partner that no matter what the circumstances, uh, they know if they call us, they'll get respond, rethink, resolve. And and I'm not worried about the ability to grow if they don't need us quite as much through that experience. So this is our mission. And I think this is why we're uniquely qualified to be that trusted advisor for customers. Okay, Hannah. Um, I've really enjoyed our conversation today. Thank you for participating. And I'm so excited uh, you know, as you continue to think about some of the feedback you get from customers. I really appreciate you know you joining the podcast and uh hopefully you'll come on again soon.
Hannah KaplanThanks so much for having me, Andrew.