ASUG understands the needs of small to medium-sized businesses with all the individual nuances and market-specific differences that every organization needs to adapt. Equally, ASUG understands big business—and they don’t get much bigger than the oil and gas industry.
Predominantly populated with multinational petrochemical firms and global business conglomerates with diverse industry portfolios, the oil and gas business is typified by large-scale operations where the operational advantages that come from economies of scale are of paramount importance.
Hard Hats and Hi-Viz
So then, with our yellow hard hats buckled on and our “hi-viz” jackets tightly fastened, ASUG is headed to the Best Practices for Oil & Gas conference, Sept. 16–18 at the Woodlands Waterway Marriott Hotel & Convention Center in Texas.
The questions we aim to answer at the show will gravitate around the nuances of these best practices and how SAP S/4HANA and the wider SAP product set is aligned to serve the needs of this industry. As the agenda suggests, the energy industry was not exactly born to be a digital native. Like many other industries, large-scale reinvention is needed for processes and production techniques to bring these businesses to a state of digital transformation.
As a dedicated SAP solutions and strategies event, Best Practices for Oil & Gas seeks to show why modern energy firms need to develop a coherent digital strategy and embrace intra- and inter-industry collaboration opportunities to survive. The event itself is focused on all industry segments including upstream, midstream, downstream, and oil field services.
Trends and Challenges in the Oil and Gas Industry
ASUG research shows that most respondents (63%) indicated that industry-agnostic concerns like cybersecurity and emerging technology play a large role in their technology decisions. Almost half of respondents (46%) believe emerging technologies like artificial intelligence (AI), the Internet of Things (IoT), and chatbots will change their businesses in the next 12 months.
Other key challenges in the oil and gas business (and the wider energy market) include the need to meet stringent regulatory environment rulings. Meeting these compliance restrictions while optimizing the performance of capital-intensive assets and minimizing downtime can be the difference between success and failure.
The inconvenient truth is that many oil and gas organizations find themselves data rich, but information poor. They need to mine the huge depths of their data lakes and discover insights on operations that can change the way they operate their business, but it can be tough to know where to start.
Digging in and Cutting Through
Cutting through this deluge of unstructured data is a central goal. ASUG research notes that critical factors in overcoming data management challenges are achieving a functional state where predictive analytics drives predictive maintenance effectively.
But before we can drive predictive efficiency, the research found that the need to lock down access to data is fundamental. Oil and gas companies say they need the ability to perform effective data management with operational integrity over asset management across field operations.
In terms of SAP technologies being used in this space, ASUG has found that despite their interest in SAP S/4HANA, the majority (74%) of SAP oil and gas customers are still on SAP ECC.
The move to fully digitally driven technologies in this industry sector is clearly a massive undertaking for organizations operating in this space. Other key questions that every firm will need to answer include:
- Do we build on the existing brownfield IT stack, rip-and-replace to upgrade with a completely new greenfield solution, or could some bluefield combination of the two work? This ASUG case study detailing work carried out by Canada’s largest oil contractor shows how important it was for this business to start with clean data on the move to SAP S/4HANA.
- Which tasks do we keep for humans and which workflow responsibilities can we shift to robotic process automation? Various speakers at the conference will address this subject. It is an area of specialty for Benjamin Beberness, global VP, Oil and Gas Industry, SAP and Juergen Eisele, head of product management Oil and Gas, SAP.
- A coherent mobility strategy is also key, so how do we build it? One ASUG research respondent noted that, “Mobility is the clear front-runner—effectively devolving day-to-day decision-making from the office to the field.” SAP customers want to use mobility tools that incorporate GPS data and use their technology systems, including their ERP systems, to extend new ways to keep them connected.
Near- and Long-Term Economics
It seems clear that the most forward-looking energy organizations will be looking to implement tightly managed data-centric digital transformation initiatives that encompass the needs of people, processes, and the undeniably high level of plant equipment that these businesses need to maintain.
Those oil and gas companies that do it right will be the ones that understand the balance needed to optimize both near- and long-term economics:
- A solid grasp of near-term economics is a prerequisite for efficient management of real-time actions, daily maintenance, and everyday operational challenges.
- A solid grasp of long-term economics is a prerequisite for equipment upgrades, equipment retirement at end-of-life, and to be able to adapt to market moves dictated by international prices, quotas, and supply chain issues.
To win in the digital energy market, modern companies have to transform to cloud computing, collaboration tools, industrial Internet of Things (IoT) sensor intelligence, and data analytics—while at the same time they must find, extract, filter, augment, contain, and ultimately supply us with the energy which we so dearly need.
Learn how your peers in the oil and gas industry are driving innovations with SAP technologies at our virtual experience ASUG Best Practices: SAP for Industries in September 2020.