Digital transformation in energy: Achieving escape velocity

The need for digital value is greater and the barriers to change are lower—yet inertia persists. Three practical lessons can help energy companies break through.

 
For energy companies, achieving value from digital technologies has become the great white whale: anxiously hunted, dimly perceived, enormous, and elusive. For the past two years, energy companies of every stripe have probed digital possibilities—running pilots in analytics, process digitization, and automation. They assumed that, as engineering-savvy organizations with a history of ingenuity, they could easily find the value from digital. Reality has proved more difficult.

Energy companies have failed to achieve substantial business value from digital because their approaches do not account for the unique challenges of being an energy company, which create extraordinary inertia. Breaking that inertia will require far bolder action than energy companies have been comfortable taking to date. They must commit to transformation.

To be sure, COVID-19 has scrambled the outlook for digital in energy. Some companies, especially independent producers and suppliers in oil and gas, must focus urgently on cash and survival—digital can come later. But for energy companies with the resources to weather the storm, the disruption of COVID-19 has done two things: first, it has underlined that survival requires getting to the next level on cost and adaptability, and that requires digital; and second, by forcing companies to abandon business as usual, it has lowered the barriers to change that typically impede digital transformation.

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Πηγή: mckinsey