Virtualized Operations for the Rest of Us
Recently, I was reading an article in the Digital Energy Journal Issue 22. What caught my eye was the title, “How virtual collaborative environments can save $120,000,000″. That’s an intriguing title and I was curious where the $120M came from. Much of the article quoted people at Capgemini. That ultimately led me to the paper that Capgemini calls “TechnoVision 2012 for Upstream Oil and Gas” (the Capgemini link will take you there for the whitepaper and a video). Basically, it’s Capgemini’s grand vision for using IT technology to change how E&P does its business. I agree with most of what I read but was struck by the scope of the vision. Their vision clearly targets the super-major size energy company. The vision is a collection of really big projects. I wanted to look at the vision through the eyes of midsize businesses. This is actually a continuation of my post “Microsoft and the Energy Industry“.
I’m not going to try to restate the details of the Capgemini vision here. You can get a copy of the whitepaper for yourself using the link provided above. The DEJ article considers the benefits of building a virtual representation of a manufacturing/production facility much like what can be done with a 3-D CAD program. That model is then connected to real-time data from the actual facility as well as data from other sources. The result is a virtual working environment which allows control and maintenance of the facility, collaboration with facility coworkers (including showing them as avatars) and collaboration with remote experts as needed. I think that the article presents a version of the Capgemini vision but is overkill. For example, I don’t agree with the need for avatars walking through and interacting in the virtual environment. That idea may be appealing for a public presentation but in actual use it would get old and clumsy.
The ideas were sufficiently intriguing that I digested the TechnoVision paper. Fortunately, there were no avatars mentioned there. What was appealing in that paper was a clearly useful list of business drivers. They are:
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The Growing Influence of NOCs (National Oil Companies)
This means national and regional politics won’t be declining anytime soon.
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Exploiting Unconventionals
This means the need to access unconventional sources of energy.
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The Aging Workforce
The baby boomers continue to retire with more people leaving the industry than enter it.
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Alignment of Quality Provisions
Aligning long term investments with oil price cycles
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Increased Public Scrutiny for Compliance Excellence
While the current oil release in the Gulf was not included as a motivating factor in the paper, but increased public scrutiny is now a certainty.
All of these factors affect the midmarket as much as the super-majors. The problem is the midmarket doesn’t have the same level of resources. I argue that the midmarket can get much of the same benefits as those referenced in the Capgemini paper by using low cost, commodity hardware and software as mentioned in my previous post referenced above. No avatars, just control panels built from commodity portal software, like Microsoft SharePoint or IBM WebSphere. Those same tools can also be used for collaboration although there are other low cost alternatives. Let’s not forget about the growing selection of low cost social media tools that can be hosted internally if you’re not ready to use cloud computing for mission critical applications.
I believe that you would be best served by thinking of my vision as well as the Capgemini vision as frameworks. A framework is just standard base of tools from which to build your own unique solution. That solution must contain business processes which include more external collaboration with experts and trading partners. Those business processes should also be automated with tools that allow quite a bit of flexibility and adaptability. Business process management tools are becoming increasingly mature and flexible. They can provide all the adaptability most companies need.
In summary, I agree with the bulk of Capgemini’s TechnoVision but advocate addressing the same issues with a somewhat more pragmatic approach. Commodity hardware and software tools used to automate more inclusive business processes can now be an effective alternative for companies of all sizes. The business drivers listed above still apply to all segments of the energy business and must be addressed. A framework based on common tools will allow projects to be simpler and faster to execute. And let’s not forget that they will offer a dramatically higher probability for success.
Until next time, thanks for stopping by…
