Transformational Challenges With A Digital Oilfield
OspreyData has had a front-row seat to observe how organizations are approaching and progressing in their digital transformation. Let’s review what OspreyData has learned from our vantage point and participation in this transformation.
Data Quality is consistently listed by producers as their top challenge. Driving data-driven decisions demand assurances of accuracy, timeliness, and consistency of data. Success with the growing complexity and sophistication of the new analytic algorithms still ties back to the old adage of “garbage in, garbage out.” Producers must consider several key areas when constructing data improvement plans:
- What is being measured?
- How is it being used?
- Are there external factors affecting reliability?
Legacy and analog tools create barriers to making data available to fuel the digital transformation. Data sources are often stored in disparate systems and across multiple silos creating multiple copies, formats, and naming conventions of data.
In his book The Practice of Management, Peter Drucker famously wrote: “what gets measured, gets managed.” Oil & Gas operators are in some ways drowning in data, yet lack key operational insights. This was recently highlighted in an Information Age article: “Executives see less than 10% of the data they have paid to inform their business with, and the data they do see is often too complicated to support agile decision making.”
SCOPE AND ACHIEVEMENTS
In her 2018 article, Jennifer Presley, Executive Editor of Hart’s E&P wrote, “Everyone is using the right buzzwords – artificial intelligence, machine learning, digitization – but truly leveraging it is taking too long.” In OspreyData’s own practice we have seen this happen as operators struggle to set realistic expectations for the capabilities and concrete results they can deliver.
The analogy that can be made is many organizations are making plans to travel to Mars but only have a craft capable of flying across the country. Setting up audacious goals is critical for achieving disruptive change. Just consider the abilities of internal teams; deep space travel is beyond most everyone today.
Operators need to leverage subject matter expertise to distill data, tackle specific problems and inform decisions in manageable or achievable chunks. OspreyData strongly believes that a critical mass of successes allows organizations to accelerate and broaden the scope of efforts. From the earlier analogy, consider a trip across the country. Or for Oil & Gas, being able to see all of your wells regardless of lift type in a single system.
Change management is and continues to be a steep slope for most teams. While the organizations realize that they must change to meet new financial and business demands, it’s only with sustained effort and focus will this be successful. As we often hear, “Old habits die hard,” or “That’s just how we have always done it,” and the venerable “If it ain’t broke, don’t fix it.”
Resistance to change is more often based on anxiety or even a misunderstanding of the possible impacts for the people in an organization. The cultural impacts of a digital transformation can’t be underestimated. In the 2017 Accenture article “Cognitive Computing: A Game Changer for Oil & Gas,” authors Holsman and Sloman found “only 14 percent of first-line managers and 24 percent of middle managers agree strongly they would trust the advice of intelligent systems in making future business decisions.” Navigating these obstacles requires a constant commitment to the innovation process with demonstrated support across all levels of the organization. Companies must target process improvements with the target user in mind that aid and facilitate change, not hamper it.