When Aker BP set out to work with data analytics firm Cognite, what might seem a strange decision was made: the results of the work were not going to be measured, at least not at the start.
It’s one of the conundrums facing the industry. Trying to get results too early, trying to run before it can walk in the digital space, and trying to adopt new digital tools without understanding what they can do or what the problem is they’re trying to solve. These were all ways to get digitalisation wrong and they were all discussed in the Digitalisation panel at this morning’s Underwater Technology Conference (UTC) in Bergen.
The problems around adopting digital technology – and the changes in strategy required – were discussed by a panel comprising senior staff from Google Cloud Nordics, Cognite, Arundo Analytics and Deloitte.
Petter Jacob Jacobsen, Director of Customer Success at Cognite and has been working with Aker BP, said: “Companies are very obsessed about what the value of doing this is. What’s the value of this or that use case. Kalle (Aker BP CEO Karl Johnny Hersvik) had the foresight and saw in the beginning we don’t want to measure anything. It was believed that if you try to measure value (at the start), getting approval is going to kill the innovation needed to get this started. We need the quick win to get people on board and get this started.”
Otso Juntunen, Regional Manager, Google Cloud Nordics, added: “The sweet spot is solving business challenges but don’t measure it in the way you traditionally measure, like NPV (net present value) for a project.”
Speed of adoption was also seen as an issue, with companies trying to do too much too early and then failing. “You should learn to pilot at speed,” said Juntunen. “Speed of innovation is increasing and that’s driven by more affordable computing, closed systems moving to open software, deregulation, all these together means there’re new entrants into every single industry. Even traditional industries like banking.” Doing fast pilots, but then being able to scale up afterwards is key, added Jacobsen.
But it’s not just about the availability of technology, applying it to solve tangible problems and not running before you walk. It’s also about having the right business models in which to adopt digital technologies.
A lot of focus has been on subscription based models, where vendors sell a service rather than a product. “In Houston, everyone wants to be in this subscription based model. You’ve seen it already in rig renting and players like NOV sell a unit and you pay a fee based on the amount of data you have access to,” said Jeff Jensen, Chief Technical Officer, Arundo. “There are proven models already. But you have to crawl before you can run. A pump manufacturer, for example, has to make sure it has the right sensors before offering service solutions. You need incremental progressive steps.”
However, there’s not just one right model, says Matthew Guest, Head of Digital Strategy & Innovation at Deloitte. “It’s ‘on-trend’ to have a subscription based at the moment. But this is only one model. Pick the business model that best serves what you are doing.”
Finding a common language between digital solution providers and oil companies, getting beyond the “bluff” and bluster, getting data out of business unit silos, being challenged by embedded traditional business processes and trust and openness were also discussed as challenges and solutions for companies looking to adopt digital solutions during the panel debate.
One thing was for certain, programmers will be more and more in demand and those who know programming and artificial intelligence even more so, said Juntunen. These are the people the industry will want to attract as more traditional IT infrastructure roles move from in-house into the cloud. How the oil industry attracts that talent is the next challenge, although it might be easier than many might think.
In an advert, a US conglomerate invite programmers to join it in order to programme aeroplanes instead app to take photos of cats. Which would you choose? Offer a tangible impact that is undersold, suggested Jensen.