According to the World Economic Forum, digital transformation could unlock approximately $1.6 trillion of value for the Oil and Gas industry, its customers and society. This value is derived from greater productivity, better system efficiency, savings from reduced resource usage, and fewer spills and emissions. Yet, the journey to these digital transformation benefits begins with a proverbial first step which can be elusive for large oil and gas enterprises who have vast legacy technologies and complicated organizational structures to navigate.
DevOps has emerged as a key process improvement that combines cultural philosophies, practices, and technologies that can help oil and gas companies address a spectrum of business initiatives by delivering services at a higher velocity. By innovating faster, oil and gas companies can more quickly achieve digital transformation benefits, whether it be sending drilling platform IoT data to the cloud for predictive maintenance or creating new services to meet evolving customer expectations.
Cloud technologies coupled with DevOps practices continue to dominate priorities for operators across the oil and gas sectors as they recognize their role in facilitating digital transformation to provide competitive and economic advantages. IDC Energy Insights predicts that by 2020, 25 percent of large oil and gas companies will have implemented a platform to develop, analyze, model, and simulate best practices in a cognitive-based continuous learning environment. Cloud-enabled technology, alignment between an organizations’ IT and business leaders, and DevOps practices are key enablers to transform IT service delivery.
Let’s explore a few industry examples of how using DevOps to enable the cloud journey has helped organizations achieve enterprise agility, as well as five tips to build a roadmap to success.
Reduce Time to Market
Deeper data insights that can expedite resource exploration, drilling and production can be gained from cloud-enabled machine learning. Big data tools coupled with the cloud’s elastic resources and DevOps automation can speed processes – like reservoir simulations – to reduce time-to-decision and reach production faster.
For example, Fugro, which collects and provides highly specialized interpretation of oceanic geological data, is able to keep skilled staff onshore using an IoT platform model. Referred to as OARS, its cloud-based project provides faster interpretation of data and decisions. In addition, new environments which previously took weeks to build, now launch in a matter of hours, providing better access to information across global regions.
Lower Costs Through Automation
The automation of IT operations and development practices help reduce costs by optimizing processes and greatly decreasing the potential for costly human error. With customized delivery pipelines, companies like Halliburton have been able to streamline complex workflows, allowing it to obtain increasingly reliable real-time data to steer drilling operations, accelerate digital transformation and enable rapid entry into new markets. Operational workflows can be optimized across the value stream – from pipeline monitoring to gaining a 360-degree view of the customer that allows you to better engage with them at the pump. Automation can help oil and gas companies prosper despite constantly changing market conditions. Take GE Oil & Gas, for example. The service provider moved 350 of its applications to Amazon’s cloud offering, AWS, over the course of two and a half years, which resulted in 52 percent reduction in IT costs. This savings, coupled with greater agility and speed to market, enables the company to compete even better in an industry experiencing immense market challenges.
Obtain Security and Compliance
Securing business-critical data while meeting compliance objectives set forth by NIST, ISO and others is foundational for every company, but especially for brokers and trading information organizations. For companies like OTC Global Holdings, balancing security with agility through cloud automation and security best practices enables these types of firms to remove errors, lower costs, increase speed, and better drive compliance.
Getting Started with Cloud-Based DevOps
By combining DevOps processes and cloud technology, oil and gas companies can innovate faster, and more quickly achieve digital transformation benefits. Here are five quick tips on where and how to start:
Tip One: Begin with a pilot project. It’ll allow you to begin in a contained environment, testing change in a limited way. Find a small, impactful project that can be completed in eight to 12 weeks and will deliver measurable business impact.
Tip Two: Identify people within the organization who will form your CoE (Center of Excellence). Experience tells us they are people who work effectively with ambiguity, have a bias toward action, are technically skilled, and embrace mitigated risk-taking. The team should be DevOps advocates, cross-functional, and empowered to capture best practices from the pilot project.
Tip Three: Following a successful pilot project, you can begin the process of scaling DevOps. Conduct a thorough portfolio assessment; DevOps efforts should focus on applications that contribute to revenue and should be invested in and therefore migrated to the cloud.
Tip Four: With several migration options – lift and shift, replatform and refactor – it’s important to understand the pros and cons of each approach per application. Analyze cost in terms of development resources and business interruptions that may be required from a significant rewrite.
Tip Five: Establish automation with technology pipelines that allow for easy repeatability. Your DevOps platform should feature technologies and processes for continuous testing and delivery, a landing zone, and security.
DevOps is equal parts people, process and technology. With a CoE in place to help train teams, a solid cloud-based DevOps platform, and automation to streamline processes and ensure they are followed, oil and gas enterprises have a roadmap to digital transformation success with DevOps.
For example, TechnipFMC, a renewable energy leader, assessed that it had two parallel goals: It wanted to use an AWS cloud migration strategy as an opportunity to overhaul its business systems and in the process, the company wanted to build standardization. Moreover, TechnipFMC aimed to increase developer agility, grow global access for its workers and decrease capital expenses. Based on its application portfolio TCO analysis, a lift-and-shift migration approach was pursued. With 80 percent of its applications now defined by a small number of templates, the company has standardized its software builds, ensuring security best practices are followed by default. The enterprise has increased its time to innovation, speed to market and operational efficiencies.
With continued market volatility, and growth in competition to meet evolving customer expectations with new services, the time to fuel growth through enhanced productivity and efficiency has never been more at hand. While the oil and gas industry has traditionally focused on operational efficiency, digital transformation offers the ability to more closely tie data inputs, and business intelligence, allowing the industry to further enhance efficiency, making smarter decisions, faster.