By Philippe Flichy, Independent Director & Digital Transformation Advisor at Endeavor Management
October 29, 2020The slowdown of the world economy and plummeting energy consumption have eclipsed most other industry news. Oil exporting countries are coming to terms with limiting production to sustain reasonable prices, and operators are looking for ways to improve efficiency. At the same time, the marketplace created by the pandemic is forcing companies to work differently. Telepresence and remote work have become the norm, and this directly impacts how work is organized and relationships are maintained. The new, distributed work environment requires discipline in the way teams conduct activities and demands a level of trust that surpasses anything the industry has experienced in the past.
At this inflexion point, it is important to examine the digital transformation that is guiding the evolution of the industry and better understand the critical role trust plays as companies learn to compete in a more digital world.
The first question that needs to be answered is, “What is digital transformation?” According to Microsoft CEO Satya Nadella, it is “reimagining how you bring together people, data, and processes to create value and maintain a competitive advantage in a digital-first world.” Data is central to this new approach, and Nadella believes a shift in corporate culture is required to bring people, data, and processes together in a new way. The “processes” Nadella refers to are the many steps required to transform data into insights.
Oil and gas executives associate digital business transformation with operational efficiencies, cost reductions, and increased productivity. Because of the range of activities performed in an offshore environment, such improvements are only attainable via extensive use of data to perform meaningful correlations.
Operators can gather more data at higher frequency rates to rationalize activities, simplify workflows, optimize maintenance activities and improve well and reservoir management. This is possible because the cost of sensors and processing equipment going down while their capabilities are increasing.
In the trend toward broader and faster data gathering, the oil and gas industry has increased the amount of information collected and worked to make better decisions and gain insight into operations. In the current market, it is more critical than ever for companies to identify ways to economize and improve project economics. This means reassessing processes and reimagining human resource management to get the best return on investment.
First, data must be collected at a reasonable cost. This means identifying data points that can be collected reliably and consistently. Once collected, data points need to be aggregated and normalized so they can be validated. With the evolution of edge computing, data processing speed has improved exponentially. Neural Decision Processors, by Syntiant, for example, feature a processor so small that 54 chips can fit on a penny. Today, this task can be performed on site where high frequency data is available for algorithms to take advantage of the best granularity of data available.
Edge processing power also makes it possible to enhance cybersecurity, leveraging machine learning to differentiate valid traffic from undesirable traffic.
Today, it is possible to temporarily store high-frequency data locally and transmit data centrally at various sample rates, depending on the level of detail required for remote analysis. High-frequency data can be used locally to perform initial validation steps while compute-intensive mining and algorithm optimization can be performed centrally. This enables companies to retain full granular data for on-demand requests and asynchronous replication by physically moving hard drives (such as Import/Export offering from Amazon Web Services) or using spare bandwidth when it is available.
The resulting improved algorithm from central processing can then be pushed back to the edge units to keep improving the data quality of the edge processing. Algorithms at the place of collection also can help correlate near-real-time data feeds to create synthetic data when a value is erroneous or missing and eliminate outliers.
An example of this approach is how offshore platforms are managing rotating equipment. Digital twins are run centrally and compared to actual measurements of the units so discrepancies can be analyzed and local algorithms updated to ensure optimal performance.
Transferring data reliably and securely at the right frequency is another step in the process. The advent of “cube satellites,” WiFi 6 and 5G protocol is helping lower the cost of transmission and increase available bandwidth, and more importantly for the oil and gas sector, reach remote places where telecommunication is not available.
A culture of trust must be present for these processes to be effective. Data must be normalized and accessed from various data bases, and this requires cooperation across disciplines and across companies. This means crossing the boundaries of typical departmental silos. People have to be willing to cooperate and share data and methodologies so teams can comfortably rely on data and analysis from other groups within the company.
Once data are made available to subject matter experts, they can be analyzed and correlated to be shared and transformed into actionable information or better, reliable insight. More accurate drilling data can lead to a much better completion design once reservoir and completion engineers compare notes with drillers rather than making sure their numbers look good.
For essential correlations to be discovered and valuable discernments to be extracted, data analysts and SMEs should sit together and leverage one another’s expertise. In today’s world of remote workers, this poses a challenge, new organizational behavior skills need to be learned.
Highly functioning teams distinguish competent companies from exceptional ones. Trust creates an atmosphere in which teams can excel and is vitally important to achieving a successful digital transformation.
Trust is based on empathy – understanding what others feel and think – which leads to kindness and respect. Trust additionally depends on clarity.
A well-articulated vision and purpose help everyone on the team to align, unifying team members and improving motivation. Clear communication enables members at every level to understand how they can contribute and simplifies discussing priorities with supervisors. Trust also requires humility, the willingness to listen and recognize that someone else could have a better idea.
Groups function best when team members learn from one another, but building trust is a challenge for today’s multigenerational teams. Sharing comes naturally to Millennials and GenZ; however, older generations, for whom knowledge retention is synonymous with power, often find sharing more difficult. The first step in the process of trust-building is to establish trust at a human level. Getting to know what affects the other team members and the group dynamics creates a level of confidence that can lead to exploring options that otherwise might not have been suggested for fear of being judged. Only that level of trust can facilitate intimate sharing, with the potential to yield better results from the long hours spent digging into the data. The successful permutation of teams onshore and offshore which started in the North Sea shows how teams build trust by sharing the experience of working at a remote operation center and working on an offshore platform.
The current tumultuous times pose a challenge and an opportunity. Being forced to adopt different work conditions opens new avenues for improving productivity and the chance to elevate performance.
The coronavirus pandemic is forcing everyone to think and interact differently. The workforce is embracing tools and technologies that have been available but underutilized for at least a decade. Mastering these tools will position companies for success in the face of a resurgence of the virus or the emergence of a new global threat.
That is important because the pandemic has permanently altered the way people work. At ADIPEC 2020, the Boston Consulting Group (BCG) reported that one North Sea operation demobilized approximately 40 percent of its traditional crew from its platforms because of Covid-19. But by using wearable technology, digitized remote viewing, and remote work planning, it is possible to perform 90 percent of the plant maintenance and integrity activity that was planned.
The digital transformation that is underway will have a direct and profound impact on the way work is organized and how relationships are maintained in the future and will necessitate environments of trust in a world where telepresence and remote work are no longer anomalies but business as usual.
The Author: Philippe Flichy, Independent Director & Digital Transformation Advisor at Endeavor Management
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