Once upon a time, a few large oil & gas companies developed point solutions to address specific production issues. A lot of lessons were learnt and a lot of money spent on bespoke software solutions, developed all under the quest for innovation. Many more niche solutions have been born from these early exercises and many academics developed papers and models around the new concept of ‘Integrated Operations’ (IO). Definitions vary through the industry, but evidence on true value realized was difficult to quantify.
Once these companies started to scale these bespoke solutions to standardization, then the ability to realize the same value on older, prized assets became less attractive, given these assets were developed many years ago under differing operating constructs and infrastructure. So, the return on investment case became less positive for expanding these solutions.
Under the environment of strong oil prices and innovation, most of these cases have mixed results (other than structured collaboration— in this context I refer to the formal process of team working, rather than collaboration centers).
Move onto current day where the focus has moved to reduction of operating costs within 3-6 month project cycles. Just knowing there is or was a problem is not enough to justify spending. In the industry, we have seen a dramatic change in how these projects are evolved with more expectations on cash flow from the business community.
Now that the industry now knows what can be done they ask how to improve their value chain using a process driven methodology on proven technology platforms across the enterprise. Involving all users in the value chain is no longer the domain of a niche solution, neither does this process get executed within the confines of a collaboration center. The enterprise is driving technology behavior to involve all users in the value chain rather than a specific group.
Before all the Change Managers provide their views on the well-trodden path of Change being important in IO, I hear you and agree. Change is more than teaching a user how to use an IO Center or a specific process and team working exercises. In fact, I see too many collaboration centers where Change Management teams have left an A4 piece of paper as the operating manual for their multi-million investment. The business community generally are left without any real context on how to use new tools and adopt new ways of working. Change in today needs to be different, and requires a much broader skill than traditionally accepted.
Today we are witnessing the emergence of a new form of Integrated Operations, I don’t want to call it ‘Next Gen….’ as this is not born from the same basics of IO and is challenging conventional thinking. Neither do I want to call it any other of the terms like ‘Born Smart..’ as this implies you have to chance to embed the right technology from the outset which does not apply to aged assets.
Today it’s not about technology, it’s about joining the dots, and I like what we are seeing emerge. We are moving to a more sustainable model that can adapt to the enterprise and leverage a wider audience without the context of a fixed working environment that is process driven to a controlled cost model and business outcome.
Instead, we now start to address some of the bigger questions, which is how to reduce cost of ownership in line with asset depreciation similar to models used in the car industry for example. IO ways of working must be able to flex to reflect that operators need to see a cost decrease over time in-line with the decreasing revenues from assets. This is a model I am now beginning to get some thoughts round, and look forward to applying those principles in the near future.
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