Considered by some a dinosaur of industries for its relatively slow adoption of digital tech, the oil, and gas industry is still playing catchup.
Energy companies know Big Data analytics, artificial intelligence (AI), virtual reality, robotics, wearables, blockchain, automation, machine learning and the Internet of Things (IoT) are keyed up to boost efficiency and profits. Indeed, companies are already applying these tools in all sectors.
But one obstacle continues to impede our transition into the digital arena. We aren’t attracting the young, tech-savvy workforce necessary to get the ball really rolling.
IT professionals haven’t been a part of the oil and gas picture in years past. Maybe a handful of Silicon Valley dwellers with a side interest in geology and engineering trickled through to get us started but let’s face it: our old-school hierarchy hiring and archaic management styles aren’t exactly what Millennials and Generation Z get excited about.
So where does digital oil and gas stand now? And what steps is the industry taking to attract the talent needed to take digital to the next level?
Big Data, AI, IoT Lowers Costs, Boosts Profits
Oil and gas companies certainly realize investing in digital is paramount. One recent study reported that nearly 40% of the upstream industry is concerned about being left behind. O&G industry experts know that technologies like Big Data, IoT and artificial intelligence can:
- Lower costs
- Mitigate risks
- Improve safety
- Increase productivity
- Enhance decision making
In short, the implementation of digital technology can secure an oil and gas company’s future long-term.
More than 70% of oil and gas companies plan to invest significant amounts into digital tech over the next five years.
E&P is reducing operating costs by automating exploration and operations. Nanobots injected into reservoirs can map the chemical and physical makeup of the entire structure for off-site explorers. The IoT oilfield can communicate real-time conditions to offsite operators, allowing for automated shut-off and repairs the second they are needed.
Cloud-based platforms analyze real-time drill and geological data, allowing for rapid, more accurate drilling decisions. Full support upstream platforms like Tachyus combine sensor data with design data, production logs, maintenance data, and seismic readings to help predict equipment failure and fine-tune operations, decreasing downtime, reducing costs and increasing production.
Machine learning offers Big Data analytics solutions to the midstream sector, allowing for enhanced gathering optimization, decision-making, and performance. Meanwhile, software solutions and the Cloud are helping refineries and oil and gas distributors streamline operations and predict financials - decreasing operating costs.
Great Crew Change Requires Cultural Shift
But the necessary cultural shift from “experience is everything” to the innovative, creative and risk-taking attitude required for successful digital transformation is still lagging. Companies willing to take on this attitude will gain a quick, competitive advantage.
Unfortunately, our industry has failed to attract the tech talent required to realize the full advantages of digital, talent largely present in Millennials and Generation Z. For oil and gas companies to make a successful move into digital, we must reach outside the industry, recruiting brilliant young software engineers, data analysts, robotics pros, cybersecurity experts and control network disciplines.
The key is to make this switch while we still have the industry knowledge and expertise of our rapidly retiring oil and gas leaders. It is crucial that this “Great Crew Change” meshes the wisdom and experience of our current leaders with the digital know-how and innate ingenuity of younger generations for a smooth, successful evolution.
But studies show that around 14% of graduates and young digital entrepreneurs say they aren’t looking at careers in oil and gas. Millennials are seeking free-thinking, relevant, socially responsible work environments that thrive on creativity, something the oil and gas industry isn’t necessarily known for.
To attract great young minds to our industry, oil and gas companies must:
- Make organizational changes to appeal to the needs of younger generations
- Seek technologically skilled employees outside of traditional oil and gas recruiting zones
- Actively engage in STEM and other education programs to cultivate a positive vibe around the industry
Houston is already making major advances in these areas, creating a Silicon Valley aesthetic in an oil and gas centered world - a perfect hub for the Great Crew Change.
You can learn more about Houston’s efforts in the Great Crew Change and digitalization of the oil and gas industry in my new book, Giant Shifts: Energy Trends Reshaping America’s Future (Sutton Hart, May 2017).