Strategies and Trends that need to sweep the sector
We’ve only ticked three weeks off the year, and the oil and gas industry has already made some waves in the media. Oil prices have sunk to lows we haven’t experienced since 2003, and there doesn’t seem to be any light at the end of this long, dark tunnel. While budget cuts and layoffs are looming, if you’ve been in the industry for longer than a day, you know that it has been here before…and will undoubtedly be here again. So, what next?
Well, the oil and gas industry is notoriously stubborn and stuck in its ways. While CEOs avoid that new invention called “email” (no, I’m not kidding), they are missing out on efficiencies that could save millions, and help to provide sustainability for this tumultuous terrain that we call the energy sector.
So, what are a few things that may come out of the tough times ahead? Below are four strategies that I believe the industry will cough finally cough embrace in order to ensure they are still standing in 2020.
Embrace Disruption
I recently read an article on Bloomberg.com that quoted Reid Calhoon, CEO of an O&G technology company called RunTitle. Reid said, "Oil and gas is one of the last giant industries yet to be fundamentally disrupted.” As the vice president of a tech PR and marketing agency and lifelong resident of the oil epicenter of the country, I quite agree. RunTitle, a company that collects data on land ownership, and companies like it, however, are changing the game.
The tech startup’s success can be seen by its recent multimillion-dollar Series A, led by Silicon Valley investors. These technologies are slated to save oil companies in downstream, midstream and upstream sectors alike millions of dollars. This has to have execs curious as they grab their ever-thinning wallets from the back of their wranglers.
Increase Efficiencies
Let’s work smarter not harder, shall we? New technologies can immediately save O&G companies money by cutting personnel costs, but others can save you money by increasing efficiencies. It amazes me that these billion dollar businesses still use pencils and paper (hey millennials, remember those?) to schedule shift work, complete quality checks and sometimes, even manage company finances. Utilizing that wood and lead for the aforementioned tasks is incredibly time consuming, incredibly inefficient and leaves tons of room for human error.
Investing in SaaS solutions designed FOR industry experts BY industry experts, like Greasebooks, is a good start to getting your efficiency on. The production reporting solution can help you track tank levels, submit gauge sheets as well as send and store run tickets, all from the field on your mobile device. This can not only make your life easier, but also ensure you are receiving accurate data in real time. Sounds like a win-win to me!
Make it the Safest in the Land
So by this section of the post, you are probably tired of me saying that technology is the answer, right? Safety will always be a concern in any industry that involves risk, but did you know that the O&G industry suffers from 110 deaths a year? This is higher than any other industry in the country. While technology cannot provide world peace, it can help save lives.
Client InFRONT’s AllClear Emergency Assembly solution was created to help quickly locate personnel during an onsite emergency. By utilizing this technology, petrochemical facilities reduce mustering times by over 90%. Up until now, there hasn’t been a solution dedicated to providing real time, rich data that will help save employees’ lives. Why wouldn’t you want to make an investment into something that can assist you send your employees home to their families at the end of each day?
Make People Happy
Ok, I promised that I wouldn’t bring up technology again, and I won’t. Enhancing your company culture is something that you don’t really need technology to do, and no matter how great it currently is, your company culture can always be improved. Turnover rates and productivity are directly tied to company culture, which are coincidentally two factors directly tied to your bottom line, so you better believe this is important.
Having the right fit people in your organization who share the company’s vision is just one part of it. Creating incentive plans, executing company gatherings and enhancing work environments can all be strategies that help to grow a strong, long-lasting, happy and productive team. I’ll leave you with an impactful quote from Marty Fukuda’s recentEntrepreneur article on company culture to let you marinate on it, While “culture” most likely won’t appear in your annual report, or as a line item on your balance sheet, it’s the glue that holds a great firm together. In reality, it’s one of the most impactful “hidden” assets a business can hold.
The magic words of 2016 are obviously technology, technology, technology…but don’t forget about your people! If you say these words three times fast, maybe a genie will pop up to grant your wish. If not, we suggest contacting the nice guys at Surge Ventures, they know a lot about the emerging O&G tech and would be more than happy to point you in the right direction. Here at Alloy, we’re wishing everyone in the oil and gas industry a successful and efficient 2016!
Alloy's energy practice helps O&G technology companies penetrate the almost 200-year old industry. Curious how we could work together to #makenews? Contact today.