There is no question that society is moving toward renewables and low-carbon alternatives. At the same time, the global population is expected to exceed 8 billion people by 2025, the standard of living is rising throughout the world, and as emerging economies evolve, their need for inexpensive, reliable energy continues to grow.
Whether your company is an upstream producer or a fully integrated enterprise, it must embrace dramatic technical, cultural, and organizational transformation to deliver safe, reliable, and sustainable energy products and services. In short, it must become an intelligent enterprise.
But how do organizations get there? The following strategic priorities are playing a key role in helping the oil and gas industry navigate the change ahead.
Extend beyond the barrel
With the advent of the digital economy and the deregulation of energy markets, consumers are more empowered than ever and are demanding simplicity, service quality, and positive experiences.
Energy providers, accordingly, want to extend beyond the barrel to master value-added activities, such as consumer energy-usage analytics, to offer services that optimize the delivery of goods, transportation, heating and cooling, and power.
To get there, oil and gas companies are starting to simplify order commitment and fulfillment processes through live inventory management, real-time availability to promise, and faster material replenishment planning. Moving forward, they will increasingly run real-time predictive analysis on portfolio performance and then fully transform and achieve their vision with customer-centricity and personalized configurations with pay-for-outcome pricing.
Digitalize products and services
Oil and gas operators are now starting to disrupt the entire value chain by managing physical deliveries across the network without owning or operating any of the necessary inventory or assets or hiring employees.
This is enabled by insights into operations, products, and services – based on real-time monitoring, integrated data sources, artificial intelligence, predictive analytics, and machine-learning capabilities. Increasingly, organizations are also optimizing human activities by digitalizing assets and outfitting field technicians with wearable devices using Internet of Things (IoT) technology to minimize manual intervention and support the digital hydrocarbon supply chain.
All of this requires that organizations optimize maintenance and operations with a remote monitoring platform for managing the entire asset lifecycle. The vision is 360-degree digital tracking and analysis of all hydrocarbon molecules to enable organizations to monitor primary and secondary costs, optimize pricing, and streamline the end-to-end supply chain.
Compete as an ecosystem
As the lines between oil and gas companies and alternative energy providers continue to blur, energy markets are becoming yet more volatile. To compete successfully, operators are increasingly sharing data with ecosystem partners to drive production, meet safety targets, and ensure profitability.
To this end, operators are moving to integrated digital platforms that enhance collaboration among ecosystem participants – helping to fast-track innovation, reduce costs, and provide operational transparency. Such platforms foster predictive insight, support integrated business-planning processes, and improve visibility into secondary costs. They also help improve customer experiences via feedback from customers and field technicians. The result is higher customer retention rates, greater loyalty, and the ability to optimize the cost to serve.
Use technology as an enabler
As leading players in the oil and gas industry become intelligent enterprises, they are moving to develop their own digital cores. The aim is to better manage and optimize systems and processes, suppliers and networks, the workforce, the customer experience, and all the data collected using sensors and other connected IoT assets.
Housed partially or wholly in the cloud, a strong digital core is critical for the intelligent enterprise – to efficiently and nimbly create new revenue centers, develop new business models, and build relationships with consumers. It also supports a consolidated view of data across otherwise siloed business areas. This puts organizations in a much better position to move forward with new business models that leverage the power of predictive analytics, blockchain, and machine learning to deliver better customer experiences.
The future is bright
The future may seem uncertain, but one thing is unambiguous: the oil and gas industry has an important role to play for many, many years to come. The companies that embrace emerging technologies to increase their agility will be best positioned to respond to market changes, whatever the future may hold.
Join our virtual event to learn more
Want to find out more about the latest trends and innovations in today’s global oil and gas business? Register today to join our flagship 60-minute virtual industry event:
SAP Industries Forum 2020: Oil and Gas
Experience the Intelligent Enterprise
Tuesday, March 24, 2020
8:00 a.m. PDT | 11:00 a.m. EDT | 4:00 p.m. CET