By embracing digital transformation and updating their existing technologies, Energy companies can improve efficiency both upstream and downstream, which will save both time and money. Recently, FlowForma hosted an Energy-focused virtual roundtable, alongside the Executive Leaders Network (ELN) to explore how leaders in the Energy sector are fueling operational excellence and planning their digital strategies for 2024.
Let’s explore the key digitalization trends in the energy, oil, and gas industry that these leading energy companies are prioritizing, and highlight how you can get ahead of your competitors by curating your 2024 digital success strategy to include the below touchpoints.
The Top Motivators in The Race To Digitalize and Achieve Operational Excellence for Energy Leaders
The Energy sector is quickly realizing that it is imperative to digitalize for a plethora of reasons. PWC estimates that in the upstream sector alone, the use of digital technologies could save hundreds of billions of dollars in capital expenditures and operating expenditures by 2025. The Energy Leaders involved in our recent roundtable event stated that the industry will have a ‘high priority’ focus on digitalization in the coming year. The top 10 motivators for digitalization in 2024 that were identified by these Energy Leaders are:
- Increasing productivity and efficiency
- Reducing error and improving health and safety
- Improving customer experience
- Defining ownership of data
- Streamlining workflows for operational excellence
- Staying competitive and agile
- Reducing costs
- Improving data visibility
- Upskilling employees/improving skills shortage
- Maximizing analysis of data
*Please note this list is ranked in no particular order.*
Another key influence for digitalization in 2024 for the Energy industry is the Net Zero commitments made by many Energy organizations. The Oil and Gas IQ emphasizes how operational excellence and digitalization have a direct correlation to lower carbon and methane emissions. They predict that organizations will be called upon and required to deliver on sustainability initiatives. Only 17% of the Energy Leaders who attended the roundtable claimed to have zero emissions at their organizations, though this figure is predicted to increase as we will see the net zero commitments shift from a nice-to-have to a requirement, as governments will implement net zero targets to reduce the carbon footprints (decarbonizing) of energy companies.
FlowForma Process Automation users have digitalized and have seen rapid ROI in under 6 weeks. They have significantly improved their sustainability initiatives with savings such as:
905,000+ sheets of paper and 90,000+ trees saved by one organization bringing a specific paper process online
An average carbon footprint reduction of 16%
Seamless reporting on emissions to easily identify areas for improvement
Digitalization in the Energy Sector To Alleviate Skills Shortages
A large reason that the Energy sector is behind in digitalization when compared to other industries is due to a skill shortage and the high demand for Energy workers across the globe. By 2025, in the UK alone, it is estimated that the Energy sector will need to attract over 25,000 new workers – 4,500 of these in completely new roles that do not currently exist (e.g. data scientists, automation experts, etc.)
90% of global Energy companies are currently automating or planning to automate work to address labor shortages. One Energy Leader who attended our roundtable gave feedback that their 2024 digitalization plan includes the leveraging of technology to replace individuals who are lost through natural attrition (e.g. retirements).
Not only does digitalization assist in filling in the skill shortage gaps, but it also aids in attracting new talent in a world where 90% of employees feel burdened with repetitive tasks, process automation can free up employee time to focus on other important aspects of their roles. As a result, workers are more productive due to the reduction of their admin tasks – did you know that one FlowForma Customer saw savings of over 6,000 admin hours in just 1 year? Another of FlowForma Customer, Grant Thornton, had a 60% process efficiency increase when they implemented the tool. Energy leaders must provide their employees with innovative tools if they wish to see an improvement in productivity and efficiency.
According to one FlowForma Energy Customer, the Chief Financial Officer stated:
"Adding technology is more cost-effective than adding people, and hours spent on manual activities and searching for data is not the best use of our employees’ time, so we add value by freeing them up to do things that would be more useful to the business.”
How a Shift Towards Data-Driven Decision-Making Mitigates Revenue Interruption
Forbes asserts that “If you’re a business owner or leader, keeping your business agile—no matter the state of the economy—requires you to anticipate problems and take action in real-time. To do this, your company must use data to drive strategy and make decisions throughout its business units”.
There is an increasing emphasis on data-driven decision-making within the Energy sector, it is not just a simple buzzword, it is an essential approach for those who wish to stay agile in an ever-changing industry. One of the Energy Leaders who attended our roundtable emphasized the rise in costs and the volatility of the energy market as a factor that makes it a necessity to reduce costs to remain competitive – they explained that they must use technology and data to make this happen. Another attendee highlighted how one of their goals in their 2024 digital strategy was to learn how to use data to improve operational efficiency – to create a system to gather, showcase, and apply data to make better decisions.
There are many benefits of using data to make informed decisions:
- Establish a common language among teams
- Break down silos
- Increase collaboration
- Fuel curiosity & new business solutions
- Drive cost savings
Data often holds many hidden gems that many companies are currently missing out on, to avoid this, Energy Leaders must prioritize educating their employees to capture, track, analyze, and accurately report on their data. Many Leaders at our roundtable agreed that one of the biggest priorities for 2024 is to train employees on how to make better use of data analytics. As oil, gas, and energy companies increasingly drive success using data and technology over heavy equipment and expansive extraction sites, companies that don’t evolve will lose out to their competitors.
When an Energy organization has sites and workers spread across multiple locations, there’s a high risk of miscommunication and poor coordination. Centralized data arms everyone with the same information, so they have a consistent understanding of what’s happening. Not only does everyone have a shared set of facts to work from, but they also have all the information they need in one place. With FlowForma Process Automation, data can be accessed on desktop and mobile, allowing visibility across multiple sites… Moreover, data may be logged without internet access, automatically updating when a connection is regained.
For FlowForma Customer Dresser Natural Gas, The Document Controller no longer has to keep the manual logbooks she used with the legacy processes, record numbers are now auto assigned, saving 15 percent of her time. Information captured around process changes and approvals are all in one system which makes it easy to generate reports using FlowForma Analytics.
What Does an Ideal Energy Data Dashboard Look Like According to Our Process Experts?
1. It will be able to be accessed with or without the internet, on a laptop, or a mobile device so that energy workers can report anywhere across their large companies.
2. It will have advanced reporting capabilities and integration capabilities to give great insight into outputs, operational efficiency, and maintenance costs and to mitigate unplanned outages and downtime.
3. Many FlowForma Customers such as Dresser Natural Gas and Bouygues Energies and Services use FlowForma Process Automation dashboards to see a comprehensive view of risks associated with price, politics, technology, financing, environment, operations etc., enabling decision-makers to offset risk exposures.
Of course, this is just a sample of what a generic dashboard may feature, it’s really all relative to the process. Each dashboard will be different, but it’s also important to note that you should select a tool that enables you to create different reports quickly. For example, Dresser Natural Gas, “had 4-6 months to implement a process automation tool due to time constraints.” And FlowForma achieved that for them with time to spare.
How To Create a Digital Success Strategy For 2024?
FlowForma is the leading provider of no code process automation to the energy sector. We are trusted by Dresser Natural Gas, Bouygues Energies & Services, Great North Wellhead & Frac, Khomechau, Centurion – and many more Energy companies across the globe.
Our team is offering a complimentary Energy-focused workshop to help you get ahead of the competition in the coming year. During the workshop, you can meet with our process experts, and share your digitalization requirements, and we will work alongside you to curate a plan that addresses your business goals for the coming year. Book a workshop to discover how we can help you reduce operation, and maintenance costs, unplanned outages, and downtime.