The processes ultimately involved analysis of spending and effectiveness of business processes within many industries abroad. The ones who survived and changed are now in a situation of harvesting the potential of their optimised processes.
Norway did not experience the financial crisis to the same degree as many other European countries. Our main concern boiled down to the very relevant level of expenditure related to oil and gas exploration and production in the North Sea on Norwegian operated rigs and vessels. Moreover, challenges with attracting enough labour to support the boom in Oil and Gas.
The oil market, closely linked to the world economy, follow the world supply and demand scenario for oil, and a general state of up and coming economies. Since 2001 the oil price have trended up with the exception post the financial crisis in 2008. The oil price enabled and attracted investment in the Norwegian E&P sector.
- I would argue the concerns of costs being a less prominent worry and covered up by an increasing profit from high oil prices, says partner Atle Sundøy from Inventura.
In 2014 the oil price fell at a dramatic rate. This particularly in view of the timelines of realising investments within E&P, which can take years all dependent on the complexity of the development and need for infrastructure. The last 10 years have supported the normality of an investment decision of expecting a return based on an oil price of approximately 60 dollars.
- Lately we have all seen several reports in the media focusing on the number of planned developments that has an assumed oil price to support the investment now being below this threshold, Sundøy continues.
Let us take this opportunity to assume the days of a high oil price is in the past and we now face a new period that allow us to focus on looking at costs and efficiency.
The changes for the future:
- Take charge and control costs
- Force innovative solutions and development of technology
- Improve processes and reduce redundancies
- Explore potentials for synergies in house and external cooperation opportunities
Any change requires a strong ownership within the management of a company. An effective and easy approach to adopt when thinking of internal measures is for management to go forward as an ambassador for the change. The issue with the oil and gas industry is often the distance between the strategic decision and the delivered product. Through closer cooperation and communication crossed between locations and levels focusing on sharing ideas and expectations. One of the dependencies that is crucial especially for future success within the oil and gas business is the supply chain and:
- Potentials for standardising and apply effective internal processes
- Handling of supplier relations
- Securing the best supplier to obtain confidence in cost level, quality and deliverability
- Increasing internal process efficiency
Time is literally money. Concepts that Inventura offer and have an excellent record of accomplishment in implementing changes for the future.
- The benefits of outsourcing this process is for it to be less confrontational, new eyes on the issues and have a third perspective and sparring collaborate when dealing with difficult decisions, or simply trying to identify a more efficient solution, says Sundøy.