The bad news is that the Oil and Gas industry has been having a rough year so far, and the downward pressure on pricing is likely to sustain for the near future. But there’s some good news, too: time and time again, industry professionals have proven that they possess near-superhuman abilities when it comes to being flexible and adaptive, despite the challenges they regularly face in the fields, the regulatory landscape and the back office.
Unfortunately, the ability of standard IT Systems to be flexible and adaptive is…well…less than super. This creates an extremely inefficient and complex environment for decision-makers upgrading, implementing and integrating specialized operational solutions for their companies. In our experience, we’ve seen the following challenges affecting productivity and success:
- Insufficient reconciliation of key metrics due to varying departmental focuses
- Inability to enable production allocation networks to handle complex events such as gas lift and buy back
- Difficulty in monitoring field equipment (like meters) 24*7 to ensure accurate volumetric readings and calibration
- Inaccurate storage of title changes and the corresponding tax components
- Incomplete, sometimes non-existent, availability of ownership data or life events involving ownership changes
- Data fragmentation or inaccuracies due to frequent merger, acquisition and divestiture activity
So how can Oil and Gas professionals avoid being paralyzed in the present or trapped in the past by their IT environments? And can they solve these issues without breaking their budgets?
One option, is, of course, to implement an updated enterprise system that addresses more current needs. However, while it’s crucial that you build your IT infrastructure on best of breed software, implementations are extremely high capital and effort intensive. They also carry the risk of becoming “scope challenged” by the time it’s ready for company-wide use, due to the long implementation cycle. Conversely, if the implementation is fast tracked, compromises may have to be made on scope and functionality, causing additional fragmentation of business processes, data and any underlying IT infrastructure.
To maximize your budget and minimize project delivery time, we suggest option two: supercharge your current system with extensions. These small, operations-oriented solutions are quick to implement and allow companies to provide measurable ROI and benefits to stakeholders in a very short period of time. By focusing on extensions that target specific workflow or process gaps within the business, an IT system can be enhanced to meet larger strategic goals, maximize value, and eliminate waste without straining your budget.
We’ve found that consultative Application Development and Reporting Solutions are particularly successful in improving process issues. For example, a mid-size Oil and Gas company wanted to improve overall Enterprise Asset Management, but didn’t have the time or budget to implement a new, comprehensive EAM system. Consultants designed a custom application that targeted AFE uploads, aiming to streamline this process and drastically reduce capital effort. The short, 3 month implementation of this simple application has saved the company over $3 million in operational costs between the Land, Revenue and Accounting departments, better enabling overall EAM without a full-scale implementation.
Extensions are the radioactive spider bite, the gamma rays or the Super Serum that gives your ordinary IT infrastructure sudden super-powers. They help your systems run better and stronger; they give the ultimate boost without breaking your budget, increasing productivity and workability across an entire enterprise, thereby letting your workforce of superheroes shine.