I write about digital transformation at least once per day—it is a swift and fickle vertical by nature, so industries like oil and gas are frequently playing catch-up to the swelling tide of digitalisation.
Following the initial (and somewhat ongoing) buzz about the incredible potential of digital technology, how it could revolutionise businesses and cut bottom lines, a more sober reality has come to light—smart technologies are only following your lead.
“All signs point to a fully digitalised, automated future, so it is important to determine which technologies can bring the greatest value to our work, and how to unleash their potential. For real traction, strategy must drive technology – not vice versa,” wrote Ahmad Al Sa’adi, SVP of technical services at Saudi Aramco in a February 2020 article for Oil & Gas Middle East.
That is exactly right. The only easy part of the journey is the technology—there is no shortage of digital experts creating and fine-tuning tools which address practically every business need. The planning and implementation are slightly trickier.
One obvious example of digital transformation done well is the Abu Dhabi National Oil Company (ADNOC). During a visit to their Panorama Command Centre in November 2019, Abdul Nasser Al Mughairbi, then ADNOC’s senior vice president of digital, walked me through the steps to a strategic digital transformation.
The foundation for any digital endeavour is data and data governance, so a digital journey starts with a thorough assessment of what is already happening in the company, which technologies are being used, what data is available, and what major pain points exist throughout the group.
Abdul Nasser Al Mughairbi
“We did a landscape assessment and we did an international benchmark, created our strategy, looked at the business opportunities and ranked them, and created a five year road map of where we should be,” Al Mughairbi said. This includes an evaluation of the technologies which provide a quick return on investment, versus those which would require a longer-term plan.
He also noted that this phase requires someone intimately familiar with the industry—digital transformation at an oil company, a coffee chain, or a bank will look different. Someone with industry expertise and at least some familiarity with digital technology has to carry out the assessment because they understand how the sector works and can identify technologies which would actually add value to their operations.
With a plan in place, companies can pick the most appropriate digital partners, and then face the true digital challenge: implementation. It’s easy to be deceived by headlines praising executives for their digital initiatives, but the real buy-in has to come from across the company.
Companies created decades ago were not built with digital technology in mind. Existing governance structures and workflows won’t necessarily accommodate artificial intelligence, the internet of things, or blockchain, for example. Even with the proper infrastructure in place, the most complex asset in any company will determine the success of the transformation – its people.
“Employees have to change things they have invested in, that they have committed time, money, and personal interest into,” Al Mughairbi said. Their buy-in is essential as they will actually have to deal with digital solutions on a daily basis. It also requires unequivocal support from upper management—in ADNOC’s case, CEO and managing director Dr Sultan Al Jaber is widely known as one of the fiercest advocates for digital technology and has spearheaded its use in the regional oil and gas sector.
At ADNOC, the digital team is very close to executive management in the company’s hierarchy; I believe this helps with agility and a ‘fail-fast’ culture, and also demonstrates the deep support that the highest ranking members of the group have for the digital transformation, all integral components to the success of a digital strategy.
The key word in this article is ‘strategy’, and I believe that with the appropriate support from management, the ADNOC method, divided into stages of assessment, planning, digital partnerships, implementation, and facilitating employee buy-in, is a good rough guide for companies seeking to digitalise.
Digital technology is not a magical cure-all, it is just a tool like any other, which can be used to achieve your goals. How you choose to apply and utilise it will ultimately determine your success.
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