Making digital transformation a reality in the Energy Industry

Why do digital initiatives fail? Or better yet, why do they often not live up to their expectations? As digital transformation ramps up, the more we dig into it, the more we see (and hear) that digitization, digitalization and digital transformation aren’t really new. In fact, across the oil and gas industry, companies have been adopting novel technologies and have leveraged data analytics for decades. And the ugly truth is that many of these initiatives often fail to meet the customers’ expectations. So, when we talk about digital transformation today there tends to be some skepticism around the topic. 

  • Text:Miguel Valdez

“Research shows that 70 percent of complex, large-scale change programs don’t reach their stated goals.” Source: McKinsey

The ‘trough of disillusionment’ associated with digitalization efforts is real. But as we inevitably move forward, now is the time to take this technology and apply an enterprise wide implementation, creating a fundamentally new operating model and kickstarting a much-needed paradigm shift. How do we achieve that? How do we create success where similar initiatives have failed to live up to and meet expectations? Well, for starters, we must look at the true purpose of these initiatives and change the goals that we set for ourselves. We’ve done the same thing for years and years. Projects are run the same, the equipment is largely the same, the execution plan is repeated, etc. etc. etc. Often, digital initiatives fall under this category, run like a project. This is fundamentally wrong.

BEST PRACTICE CONSIDERATIONS

In order for digital to truly succeed and for the industry to really change, there has to be a higher level of sharing, collaboration and coordination. These aren’t digital projects, these are evergreen, enterprise wide solutions. They can (and should) change the way your entire business operates, from finance to maintenance to operations, the data and technology exists to digitalize the work environment, ultimately creating a user focused way of working, bringing contextualized value not just to the business but directly to the hands of the individual users. From sensor technology to cloud solutions, we have to expand our ability to integrate, contextualize and operationalize our data. And the reason why is even more important.

1. VALUE ACROSS ALL YOUR BUSINESS

We can’t do that however if operators view digitalization as just an asset, facility or location-based tool. Digital twin for instance, is largely valued as a collaboration tool but in reality, it’s MUCH more than that. Think through the life of an asset or the investment that the business is making in asset development. Think beyond just your capex scope, your project scope or installation scope. Think beyond all of it and look closely across the entire business. Consider the business challenges that you want to solve and connect that value to your digital twin, embrace the concept of scale.


Digitalizing just one part of the operation instantly limits the positive effect and innovation that something like a digital twin can deliver. Digital Twin presents an opportunity to provide a context-specific work surface to each user, allowing the work force to access an asset from everywhere, with higher level insights. The challenge, however, is aligning your digital transformation initiatives to tangible results across the organization. This doesn’t have to pose an insurmountable obstacle, just a shift in mindset.

2. ALL OF YOUR DATA

For instance, a Digital Twin should be agnostic with respect to data source consumption and architecture. If it’s not, how can you completely operationalize a virtual asset if you’re only incorporating parts of the assets’ data? Breaking that down to another level, we need to ask ourselves; what type of systems do we have? Are they connected? Where do they fall in the building blocks of something like a Digital Twin? We might be surprised at some of the answers. Think about the devices we use in our day to day. From chemical refineries to offshore platforms, a lot of the heavy lifting is already done.

3. CHANGE IS GOOD

Another hurdle to overcome is simply perception. Change can be hard, and it’s often met with resistance due to a lack of understanding or fear. Roles will change, but that’s not a bad thing. We must be willing to break down some barriers, to take the things that are “written in the walls” and share them so that we can be confident we’re always making the right and best decision, regardless of geographic location.

We do that by engaging at every level from the start, in the development of our goals, our ambitions and the purpose behind them. We seek and gain buy in from our teams with a commitment to work together and create the new working model based on the application of the selected digital solutions. There should be recognition that digitalization is not finite, but evergreen, always growing, and always scaling. Use case development and use case identification will happen almost daily when every level believes in the solution.

“62% of people who either don’t like to leave their comfort zone or do so only occasionally” Source: Forbes

4. SOLVES PROBLEMS

Lastly, and probably most important, we have to understand the problems that we want to solve to increase our chances at real value creation and success. The goals should be aligned with not only the operations needs, but with the overall strategy of the business and with clear purpose. Role based considerations, day to day workflows, use case identification and objectives should be prioritized from the beginning. That sounds like just a business-driven decision but in today’s world, it’s really much more than that. It’s an opportunity to unify the business at multiple levels and should be viewed that way, ensuring that the result brings real value but it’s also an opportunity to initiate changes so significant, the lasting effects will be felt well beyond just the organization itself. The possibilities that exist with successful adoption and digital transformation are so significant, that operators can’t ignore it anymore.

This all happens with the Kognitwin® Energy digital twin, where, beyond visualizing the asset, it facilitates smarter decision making through:

1.     Collaboration, leading to accelerated organizational adoption and digital transformation
2.     More advanced degrees of analytics, i.e. predictive, prescriptive and autonomy

Today, the solution is actively deployed in Energy facilities around the world supporting the customers’ organizational goals while optimizing operational efficiency, safety, maintenance and energy consumption.

Combining cutting edge technology with scalable solutions, with Kongsberg Digital as your partner, you can deploy the dynamic digital twin Kognitwin® Energy in your asset in a matter of a few weeks and rapidly start benefiting and extracting value from this technology.

Miguel Valdez is a Growth Manager in the Digital Energy team at Kongsberg Digital. Based in Houston (USA), Miguel has over 10 years experience in the Oil and Gas industry managing aftermarket services in the deepwater oil and gas sector, major subsea capital projects around the globe and strategic business development.