The future is calling as a digital dawn is breaking over the oil and gas sector. A necessary transformation is needed to rise to the growing demands and upcoming challenges across the industry.
This looming obstacle is something many other industrial sectors are also grappling with – a generational shift within their workforce.
How will this affect both those joining and leaving the field? And how will this issue interact with other industry challenges such as growing environmental expectations and the adoption of new technologies?
Read on to discover how Peter Wilson, Giulio Cattarin and Robert (Bob) Hooper, industry consultants for technology company Hexagon, see the future of oil & gas.
Watch: Is the Oil & Gas Industry Ready for the Generational Shift?
The obstacles ahead
According to the Global Energy Talent Index Report, an astonishing 80% of workers said they were approached for a job by another company. Coupled with the fact that 20% of the sector’s current workforce is over the age of 55, in the coming decade the oil and gas industry expects to see one in four employees entering retirement.
This raises several alarms that must be attended to if the industry hopes to attract and retain talent, industry knowledge and drive the sector into a greener and more technologically advanced future.
The retiring generation
Commenting on the upcoming generational shift, Peter notes: “Companies have not invested in training people to have the requisite skills to take over and replace the existing workforce when they retire or leave the sector.”
The departure of these individuals from their roles, alongside their informal know-how, knowledge and experience, is a key threat to maintaining the safety, efficiency and reliability of current and future operations.
With experienced employees leaving the sector and a lack of investment in new talent, companies risk facing major skill shortages in the years to come.
Attracting and maintaining new talent
But what if oil & gas companies did invest properly in training new talent? This would solve the issue, right? The short answer is, not fully.
Aside from training and retaining new talent, the oil & gas sector is struggling overall with its recruitment efforts. “The drive to recruit recent graduates is hampered by the reality that this sector is viewed as being ‘old fashioned’,” says Peter. “The perception is that the companies haven’t been at the forefront of implementing new technologies and working practices compared to some new and growing business sectors.”
Giulio echoes this: “The younger generation expects to be able to find accurate information quickly, and possibly via a mobile device.” In short, oil & gas organizations are losing out to other industries due to their slow uptake of digitalization efforts.
Qualified newcomers are looking instead for opportunities in ‘tech-savvy’ industries boasting innovation.
Environmental demands
Another layer to this issue is rising environmental demands. When competing to attract new talent, oil and gas companies may find that newcomers and graduates are opting for roles in sectors with an increased focus on sustainability.
Additionally, more is being asked from the sector to align with the environmental goals outlined at the COP28 event.
“There is a huge commitment required to reduce the current level of emissions. Governments, as well as companies, need to work together to make this vision a reality,” says Bob. He continues to say: “This creates joint opportunities to pave new pathways toward a more sustainable future with cleaner practices.”
It is therefore clear the oil & gas sector must transform and, as Bob says, “adopt a digitalization strategy,” to achieve compliance with overarching environmental goals and to attract and retain a new workforce.
Overcoming these obstacles
Although the generational shift brings forward an array of challenges to overcome, there is one standout solution – digitalisation.
Giulio emphasizes that it is not enough to only digitalise processes, but that a full digital solution/transformation should be harnessed. “If you digitise a physical document, but your solution creates a new silo that doesn’t speak with other systems, you are not getting very far,” he adds.
Therefore, you should seek solutions that are easy to use, stored in a single location but have the insights and capabilities to inform various work processes, teams and stakeholders all at the same time.
The increasing role of digitalisation
To this point, “the oil and gas sector [still] struggles with information being inconsistent, out-of-date, incomplete and inaccessible,” says Peter. Remedying this through digitalisation will be essential to the success of the sector going forward.
But contrary to popular belief, implementing a digital transformation within an organisation does not mean completely replacing old work processes and systems.
The right solution can seamlessly integrate with existing solutions and corporate systems.
Implemented well, digitalisation can support:
Training new talent – Existing or undocumented knowledge and essential training information can be made widely available, smoothing the learning curve for new joiners.
Meeting environmental regulations – Digital solutions will enable oil and gas companies to modernise existing facilities and processes to meet environmental goals and targets.
Addressing the sector’s image problem – Incorporating digital tools will help to attract new talent opting for jobs in forward-thinking and innovation-focused industries with career progression opportunities.
Avoiding human errors and risks – Easily accessible data will help to avoid human errors, increasing the efficiency, safety and reliability of operations.
The future is digital
Hexagon’s solutions are designed to digitalise where and when it matters to your organisation.
Looking to start your digital transformation journey? See how Hexagon technologies can adapt, integrate and help your teams and operations to evolve alongside the oil & gas sector.
To hear more from Peter, Bob and Giulio of Hexagon, check out their recent LinkedIn LIVE discussion, where they delve into this issue in more detail.
Visit Hexagon’s website to find out how the firm helps oil and gas companies connect stakeholders and work processes throughout the design, construction and operation of oil and gas assets.
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