Playing Catch Up: Necessity Driving Industry’s Need to Innovate
We hear how technology is reinventing retail, entertainment, telecommunications, healthcare and other industries all the time. How, through technological advances, processes are streamlined, customer service is increased and efficiencies are gained.
But when it comes to the Oil and Gas industry, these technological insights are often unseen and left unpublished. In fact, we often hear the opposite – about how far behind the Industry is.
Why is that?
“Despite the lack of press, Energy companies – not just Oil and Gas, are making huge strides in technological advancement,” said Scott Steffens, Senior Account Executive at DISYS. “O&G is adopting new tech and finally allocating funds to help the industry work smarter.”
But that wasn’t always the case.
For many years, O&G has lagged behind in technology because of the sheer cost of retooling its long-standing resources and the time it takes to retrain. Think about it: With the world’s growing dependence on O&G resources, most companies couldn’t afford to slow down and catch up to the technological windfall.
But now, many IT changes in the industry are driven by the fact there is a huge chunk of the O&G workforce retiring in the next 5-10 years. But also, industry insiders are finally realizing that it is just time. There are simply too many benefits to be realized by modernization.
For instance, if you look at the number of patents over the last 15 years, the US Patent and Trademark Office (USPTO) has seen a huge spike in Oil & Gas requests.
According to the USPTO, the growth of patent classes involving O&G and its technology outpaced growth in most of the other larger patent classes, increasing 62% between 2002 and 2013. By comparison, most classes saw an average increase of 23% during the same period.
“O&G is one of those industries, where change can easily effect everyone,” Steffens said. “This is why it’s vital that innovation in O&G IT processes take a front seat to other initiatives and that special care is taken to get it right.”
This means the industry, while spending budget dollars on IT advancements, is taking it slowly as to not disrupt operations. For instance, companies are making improvements in technical and operational capabilities like predictive maintenance. But recent surveys in O&G indicate companies aren’t necessarily increasing their IT spend year over year, but rather keeping it steady as to reiterate the need for change, but also recognizing the need to not do too much too soon.
Upstream (exploration and production) digital advancements indicate O&G will continue to invest in IT over the next 3-5 years, shifting from investments in mobility, IoT and the cloud to Big Data/analytics and IoT and also on the innovation of emerging digital technology.
“Analytics and IoT are going to lead innovation in O&G over the next 5 years,” Steffens said. “Executives in the industry realize analytics represents a huge opportunity to literally transform the way O&G does business.”
Currently, only about 13% of the collective O&G leadership believes the industry’s analytics capabilities are mature and developed enough to give a full picture of what is happening in the field. In contrast, 87% are trying to quickly develop in-house solutions and utilize external market skills and platforms.
This need for efficient insight into operations is magnified with the current price of oil, per barrel. At a going rate averaging $50 per barrel, efficiency and cutting costs are key initiatives.
“When prices were at $100 per barrel, the industry didn’t have to worry about efficiency, updating IT systems or gaining insight into operations through analytics,” Steffens said. “But now, some industry insiders are calling the crash a ‘blessing in disguise.’”
And while still in its infancy, it is estimated about 50% of O&G companies are employing some iteration of advanced analytics. With this reporting comes a better understanding of how to boost performance of certain industry activities. For instance, efficiency in the most rudimentary of levels – tracking trucks and shipments – is benefiting O&G tremendously through real-time data available anytime, anywhere.
“Other industries have been employing real-time shipment tracking for quite some time and reaping the benefits of it,” he said. “But again, we are seeing O&G make huge strides in playing catch-up to other industries.”
On the innovation front, O&G insiders predict huge change over the next 3-5 years, as the industry employs and implements Robotics Process Automation (RPA) to complete many of its now manual tasks.
One study, performed by CISCO, reveals the potential of 25% to 50% of manual processes to be automated within the next 5 years.
“The use of Automation is a true game-changer for O&G,” Steffens said. “We are seeing an industry that is truly undergoing major, multiple transformations led by necessity and the need to have much more information.”
In anticipation of the importance Automation will play in the Oil and Gas industry, Digital Intelligence Systems, LLC (DISYS) has broadened its capabilities in its Automation Center of Excellence (ACE) – fully capable of helping O&G meet the challenges it faces through repeatable task management.
The DISYS Automation Center of Excellence (ACE) helps clients automate IT and business processes to reduce IT spend, lower processing costs and improve efficiency.
And with an increased emphasis on efficiency, DISYS believes Automation has the potential to break new ground in O&G – through the interpretation of large amounts of data. This data is currently impossible for the industry to process, let alone interpret. Automation can help, while simplifying redundant processes currently utilizing thousands of man hours.
“This is a very exciting time to be in involved in O&G and DISYS has anticipated the industry’s needs by broadening the scope of ACE ,” Steffens said. “Machine learning’s potential will open up vast opportunities in efficiency and huge cost savings. Eventually, Automation will touch almost every aspect of O&G and the industry will no longer lag behind in its technological advancements, but finally lead the way.”
About Digital Intelligence Systems, LLC (DISYS)
As DISYS’ longest-established area of expertise, our Energy vertical has an extensive track record of partnership building solutions that address the key industry issues of today. As the world experiences large-scale diversification in the Energy sector, DISYS deploys solutions that enable management of energy in all forms. In particular, DISYS is helping the oil and gas industry traverse energy diversification by implementing solutions that preserve profitability while creating long-term, sustainable outcomes for the future. Our clients recognize that diversification is critical to business success and DISYS has diversified our solutions to keep pace with the myriad ways clients are approaching transition.
Whether expanding product offerings, consolidating networks or expanding global operations, DISYS is creating powerful application development, infrastructure, and resource management solutions that remain focused on regulatory compliance and safety – all in support of operational efficiency and business optimization efforts occurring globally.
For our Energy clients, DISYS is solving the following industry concerns:
Operational efficiency:Global process optimization through deployment of digital and mobile productivity tools and solutions. Centralized project management through DISYS’ proprietary CDMS tool offers improved management and support of dispersed implementation teams and ensures issue-free project delivery.
Transformation: Business transformation models that combine process integration, optimized resource management and low-risk project rollout. Diverse pricing models offer clients the ideal mix of low-risk, speedy implementation and cost containment.
Organizational Consolidation: Technology and asset relocation and support services for global and domestic relocation activities using our Datacenter Operations Framework. 100% adherence to critical safety guidelines resulting in zero productivity loss for touch-labor services.
Increased customer-engagement: Our Mobile Development Library enables app development that puts utility consumption and optimization efforts in consumer hands. Business Intelligence solutions that provide in-depth insight into consumer behavior – enabling the refinement of consumer marketing and acquisition efforts.