7 Top Oil and Gas Industry Technology Trends for 2021 and Beyond
Despite reports assessing low marks in overall digital maturity and adoption, the oil and gas industry stands upon a precipice with its relationship to technology. More and more companies are purchasing enterprise software packages with the intent of streamlining operations and improving real-time data processing. However, business leaders must understand how the services can impact their unique company. They must also assess whether adopting certain trends is the best decision for their business.
We’ve discovered seven current trends in the oil and gas industry and provide our insight into what they mean for your business now and in the future.
The Biggest Digital Trends for the Oil and Gas Industry
Most companies don’t have the capacity to maintain the physical technology for their data requirements. Thus, whether you call it a cloud-first or cloud-smart strategy, moving to the cloud for cost reduction, data security, and outsourcing has increased in popularity. However, your business should explore its options and find a solution that matches your specific needs.
2. Cost Containment and Management
Shrinking margins in the technology aspect of the oil and gas industry mean finding ways to reduce spend and use the budget more effectively. Your company should consider whether the following tactics work for your situation:
- Evaluating software contracts
- Eliminating old, outdated software
- Application and data architecture rationalization
Specifically, you should evaluate your Enterprise Resource Planning (ERP) software in terms of applications, integrations, and processes.
Since the invention of the internet, one major concern from business leaders is security threats to their companies. With most businesses now running online, it’s essential that you use proactive measures to protect your business from cybersecurity threats.
Start by evaluating and assessing your internal security against breaches. From there, you should investigate whether on-premises or cloud computing is the right solution, especially when it comes time to pursue encryption services.
4. Acquisitions and Divestitures
No matter your company’s size or structure, you will always need a clear playbook for data and IT information transfers when it comes time for organizational change. Understanding your capacity and capabilities is crucial for ensuring a smooth transition.
However, while large companies have the luxury of building full-scale mergers and acquisition departments, mid-market and smaller companies do not. They should instead pursue third-party assistance to navigate through the nuances of the change. Doing so better positions them for success and minimal disruption to the business.
5. Better Decisions with Real-Time Data
Big data analytics are the name of the game, especially in the oil and gas industry. However, just because you’re creating and collecting more information than ever before doesn’t mean you’re using it to its fullest potential.
Too many employees waste time engaging in data assembly instead of actual data analysis. Before choosing a technology that helps gather more data, invest in one that lowers assembly churn and increases analytical acumen to empower decision-makers.
6. A Fresh Perspective on Outsourcing
The concept of outsourcing still leaves some companies with a sour taste. That reputation typically comes from working with offshore companies specializing in a single task. Yes, they can help save money, but it often comes at the expense of poor customer service and hiring several different companies to meet your many needs.
The tide, however, is slowly turning in favor of multi-discipline onshore companies that can take care of several tasks in a comprehensive fashion. By working with a single vendor — instead of purely low-cost options — you enjoy the benefits of high-value outsourcing that lowers your costs and increases efficiency.
7. Increasing the Use of AI and Automation
It’s one thing to use enterprise software that helps collect and process data more effectively. It’s something entirely different to adopt artificial intelligence to increase the automation of repetitive back-office processes.
An increasing number of oil and gas companies through the energy chain have embraced AI to assist with acquisition, machine learning, optical character recognition for natural language processing, due diligence, and more.
But before you go all-in on AI because “everyone else is doing it,” be sure that you would benefit from the technology.
How Should Oil and Gas Companies Take Advantage of the Trends?
At EAG Inc., we are big believers in the power of technology to help your business save money and operate more efficiently. Many of the trends we have described can certainly provide more of a holistic view of your operations and just run your business more efficiently overall. Better technology helps you better manage high-profile, complex projects, and your day-to-day processes with ease.
Ultimately, your company needs to conduct a thorough evaluation of your environment to see which of these trends is right for you. This process entails asking questions such as:
- What are your needs?
- What is your strategy?
- What technology do you have?
- What is your current hardware spend?
- What are your maintenance practices?
- What are your present costs and future budgets?
- Can you create internal strategies for adopting and following the trends?
Should Oil and Gas Companies Be Cautious About Any Trends?
As mentioned previously, not every trend will be suitable for your company. You should be extra careful about the technology you adopt. Specifically, we urge businesses to avoid “innovation programs” that pursue tech for tech’s sake. In our experience, purchasing technology without a clear business case or a defined measure of success is an invitation for wasted money.
Avoid purchasing technology just because of the pressure to have new technology. Understanding how the new technology works and integrates with your current application landscape is key, and it will create a more productive and engaged workforce.
You should never jump into technology as a solution without preparation, planning, and strategizing. Instead of following buzzwords and hype, you should first pursue a good partnership with a technology or outsourcing firm that specializes in this market.
The 3 Most Exciting Aspects of These Trends
EAG 1Source and EAG Services pride themselves on moving the needle for the oil and gas industry by leveraging technology and solutions for their clients. In summary, companies will benefit from:
- Improved decision-making through real-time data
- Modernized architecture that automates collection and assembly so humans can spend more time with actual analysis
- Increased opportunities to identify actual cost so you can reduce spend and follow your budgets more effectively
When your company correctly implements the solutions that best fit their requirements, you can better plan for the future while maintaining the present course.
The 3 Biggest Causes for Concern with These Trends
We have also identified three areas where these trends could cause trouble for the oil and gas industry:
1. Cybersecurity is a necessary spend that businesses underestimate.
- People should be more proactive than reactive.
- You need plans and protection before an event occurs so you can solve issues quickly if they arise.
2. People jump on trends because they’re popular, resulting in a destructive spiral.
- They don’t develop meaningful goals and strategies.
- They blame any poor or negative results on their inadequate setup or on the technology itself.
- Employees aren’t aware of the “why” when companies make a change, resulting in an unmotivated workforce.
3. Insufficient M&A preparation sets the stage for IT failure.
- No playbook = Unclear processes
- No IT due diligence = Incompetent technology integration
- No strategy = Flying blind with day-to-day operations
- No guidance = Zero long-term vision for incorporating additional technology
Your Oil and Gas Company Must Be Intentional with Adopting Any Trend
Our mantra for software solutions applies doubly to large-scale movements in the technology sphere — “One size definitely does not fit all.”
Your business must precisely analyze what you need from technology before considering integrating something into your current technology landscape. If you don’t have a plan in place for how, when, and why that interesting innovation will help, you will not reap the benefits of technology.
Before you begin your research into how your company can take advantage of any of these trends, consider contacting EAG 1Source or EAG Services. As the team behind your team for all things back-office, IT outsourcing, and consulting, we will help you investigate your options, create a winning strategy, and develop an integration plan that puts you on a path to success.