Accenture and Microsoft recently commissioned an upstream oil and gas digital survey. Although oil and gas prices are well off their highs, upstream companies are continuing to invest in technology that will improve operational effectiveness in the short term and add value to the business in the medium/long term.
Eka has certainly seen this willingness to invest with our ETRM software. In the first half of 2016, we’ve had very strong interest and sales in our ETRM software (and CTRM software). Followers of this blog know that Eka has been investing heavily in digital and analytics over the previous 18 months. Since Eka launched Commodity Analytics Cloud six months ago, it has had a tremendous reception in the market. To that point, we recently issued a press release covering the market excitement and acceptance with the headline – "In the first six months of availability, seven enterprise customers in the U.S., Europe, Australia, Asia, and Canada have licensed Commodity Analytics Cloud."
So the survey trends are not surprising here, but I thought worth posting.
Five Survey Trends and Accompanying Insights
TREND 1 - Digital is creating value and could create even more.
Insight: Digital is enabling upstream oil and gas companies to reduce costs and better manage operations through new capabilities such as advanced analytics and new flexible models like "as a service."
TREND 2 - Investment continues and is expected to increase.
Insight: Oil and gas companies are turning to digital to help them manage through the current challenges in this low oil price environment.
TREND 3 - Investments are focused and targeting value.
Insight: Oil and gas companies are focusing their digital investments on areas where they see tangible business value. In the short term, given low oil prices, oil and gas companies are focusing these investments on areas that deliver more immediate benefits in cost reduction. This includes lowering the cost of operations through increased worker productivity with mobility, lower infrastructure costs through the use of cloud, and better asset management through analytics. Over the next 3-5 years, investments are expected to shift focus on areas that deliver the greatest long-term value, such as more comprehensive predictive operations management capabilities.
TREND 4 - Increase in analytics capability.
Insight: To realize the benefits that digital can create over the long term, oil and gas companies need to quickly improve their capabilities, including maturity in analytics. To address this they need to work rapidly to develop in-house capabilities and leverage external market skills and platforms.
TREND 5 - Increased use of cloud to unlock the value of digital.
Insight: Use of cloud has become mainstream for oil and gas companies. It was used mainly for cost reduction in IT infrastructure but now has become an enabler to more quickly unlock the value that broader digital solutions can provide. Oil and gas companies need to quickly adopt full hybrid cloud solutions in order to accelerate the value that digital solutions can deliver.
The Key Takeaways from the Survey
The survey points to analytics, cloud, and mobile as key elements of digital solutions needed by survey respondents. It’s interesting that those are key tenets of Eka’s Commodity Analytics Cloud along with easily using data from multiple sources (including spreadsheets), processing large volumes of data in real-time, and making the solution usable by business people without having to rely on IT and analytic specialists every time new analysis is required.
The apps within the Commodity Analytics Cloud platform hit on all the key points in the survey along with the other tenets mentioned. For example, one app is an IoT optimization solution for stockyards, inventory, and ports. (Learn more in "Making Bulk Material Handling Completely Smart with IoT.") Eka’s IoT analytics optimization app delivers higher efficiency, greater throughput, and lower downtime.
- Sensors and other external data sources continuously collect information about the condition and operation of equipment at agriculture and mining sites.
- Corrective action is taken as soon as execution starts to deviate from plan.
- The increased flow of monitoring data and modern software technology enable optimization models to run more frequently.
- Real-time monitoring data from sensors is used to optimize ship schedules, train schedules, inventory, reclaiming, and stacking.
»»» Download white paper on IoT. «««
Analytics is the next generation in commodity management and builds on ETRM and CTRM software transaction systems. As the survey shows, companies are investing now in digital and if you’re not, you’re falling behind!
