Since the Industrial Revolution, the Oil and Gas industry has played an instrumental role in the economic transformation of a number of countries. Even today, oil and natural gas play a pivotal role in the global energy system, with 31% and 21% of the world’s energy supply coming from oil-based fuels and natural gas respectively. However, the Oil and Gas industry experienced a major transformation after the shale boom in the United States and the Paris climate accords which completely changed the sector’s outlook. The long-term impact of the downturn can still be felt by Oil and Gas companies that continue to operate in a highly regulated and uncertain environment.
The oil price collapse that began in 2014 resulted in a wave of cost reduction among leading Oil and Gas companies. Industry leaders slashed their capital expenditure, laid off a large number of employees, and canceled projects that did not meet their profitability criteria. The efforts paid off, and the expected oil price gains constituted a lucrative opportunity for Oil and Gas companies. However, to manage and benefit from the volatility, the C-suite executives will be required to ensure that their business models are prepared to handle continual change.
Technology adoption can also help Oil and Gas companies improve their performance. There are some applications available which Oil and Gas companies can use to support their back-office functions and drive efficiency in the field. For example, technology-driven companies are already using robotics to perform repetitive tasks and reduce their labor requirements. Similarly, sensors can be used to predict equipment breakdowns and minimize downtimes.
Although profitability is an important metric, Oil and Gas companies need to also focus on improving their production and reserves as well. Improved production is essential to ensure sustainability in the event oil prices experiences a downturn once again. Focusing on both production volumes, and profitability and cost efficiency will require them to make remarkable changes in their corporate culture and operations.
Despite all these challenges, the outlook remains largely positive for Oil and Gas industry. However, since past worker layoffs have cost Oil and Gas companies significant experience, knowledge, and skills, they will be required to come up with a game plan to bridge the talent gap that is needed to pursue the opportunities available to them.
Allen Austin understands that the C-suite plays a critical role in the long-term success of any Oil and Gas company. They are the people who plan the drilling projects, deploy assets, and set the tone for their company’s culture. We help Oil and Gas companies find such competent and insightful leaders who can excel in the highly dynamic and complex environment of the Oil and Gas industry.
Our depth of industry knowledge and experience enables our team to help Oil and Gas companies bridge their leadership gaps. Our executive search services focus on helping the client create a precise leadership roadmap based on strategic objectives and the unique challenges faced by their company.