IT in the oil and gas field

The oil & gas industry is a pillar of the Canadian economy. To thrive, Canadian companies are continually focused on operational excellence to remain fiscally strong and competitive on the global stage. Technology, more than ever, is playing an important and strategic role within many organizations. Existing operational approaches and legacy business process are being re-evaluated. Oil & gas leaders need to begin the transformational journey by recognizing that the technology got them where they are today, will most likely not allow them to adapt and succeed in the future. This is why the industry is starting to look at the role of cloud and digital technologies across the upstream, midstream and downstream value chain.

The intersection of the digital economy and impacts on the oil & gas industry are interesting indeed. Recently, one IT leader in Calgary described to me the idea of discovering the daily “digital moments” to uncover potential automation and process efficiency gains throughout the “day in the life” of his workforce. Operational excellence is never a single event – it is a constant and vigilant practice that evolves as innovative ideas emerge. John Vardalos, founder and CEO of Calgary-based JFive had this perspective,

There is increased pressure on our energy clients to further scrutinize cost and capital budgets due to the recent volatility in oil price. Our forward-thinking clients see this period as an opportunity to rethink how work, especially operational productivity, can be streamlined and maximized by leveraging cloud-based platforms. These cloud-based modernization solutions are transforming oilfield operations, reducing costs and sometimes even saving lives.

New technology will work its way into the oil & gas sector from adjacent and, perhaps, unrelated industries. This brings new ways of thinking that allows business and IT leaders alike to continually achieve higher levels of operational excellence.

Oil & gas leaders are faced with higher levels of complexity given the nature of the business. CIOs must often assess risk to ensure integrity of organizational information. The digital transformation occurring in oil and gas is due, in large part, to the proliferation of cloud, mobility and the digitization of information. The key to success will be embracing these trends sooner rather than later to achieve higher performance and improved workflow processes. For many CEO and business unit leaders, time to business value is the only IT metric that matters.

Interestingly, early this year, Gartner launched an oil & gas industry focused research agenda to advise CIOs and lines of business leaders during this time of disruption and transformation. Historically, the oil & gas industry has been full of heavy paper-based processes. The benefits of cloud and digital technologies will see greater connectivity to information internally and sharing externally with contractors and partners. Naturally, from a productivity perspective, the #1 challenge many organizations face today is access to information spread across a myriad of content silos that are notoriously difficult to access which significantly adds to non-productive work time. Cloud-based platform architectures that facilitate collaboration and access to information across silos will proliferate to meet the future of work. Gartner states, “At the same time, an increasing number of geographically dispersed virtual teams, including members from outside organizations, are requiring dynamic access to information and systems.”* The ROI is too great to ignore, depending on the size of the organization, saving each employee a couple of hours per week in time spent simply looking for information can translate into millions of dollars in savings by reduced non-productive work time.

To ensure current and future business value, cloud computing platforms that serve as the information content layer must be able to interoperate across the numerous legacy on-premise systems. This platform approach will eliminate the many challenges experienced today by end users in getting access to information and be that “step change” outcome desired by many in the oil & gas industry. Additional benefits for IT may be reduced costs across the application landscape along with time to business value being measured in weeks instead of months and years. Those organizations that evaluate and adopt cloud-based platform technologies now will be advantaged to out innovate their competitors tomorrow.


*Gartner, Planned Research for the Oil and Gas Industry, 2014, Rich McAvey, Leif Eriksen, Zarko Sumic, February 7, 2014

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