With oil prices still low compared to last year, oil and gas IT strategies will seek more agile solutions through the rest of 2015 in order to stay competitive in the face of budget cuts.
While 75 percent of IT departments have terminated one or more employees this year in the oil and gas industry, budget cuts have not been as bad as earlier projected, according to a recent IDC report.
“The impact of lower oil prices on oil and gas IT budgets is not as much as expected, and cuts are not across the board as companies are more strategic and disciplined about reductions. The challenge for CIOs is to understand the company's plans going forward and present the role of IT to help successfully implement these plans," said Chris Niven, research director with IDC Energy Insights. “Oil and gas companies need to spend their investments wisely to help them become agile and operationally efficient. The software vendors and service providers that help them achieve these objectives will be successful.”
Here are 3 Oil and Gas IT Strategy Recommendations from IDC:
- Focus on immediate goals and objectives and identify what resources and tools are necessary.
- Be prepared to cut, reduce, and postpone investments to accomplish these goals in the short term.
- Identify which IT areas are core to the business, which can be outsourced and which can be dropped.
For agile solutions many will turn to the cloud for anywhere access and scalablity. Moving to the cloud is one of the quickest ways to reduce IT overhead, plus faster deployment means goals can be achieved more quickly. With monthly subscription pricing rather than licensing on premise, it is easy to scale up or down and internal IT teams will see fewer support requests and have more time to focus on strategic initiatives.
As IT budgets shrink, so does the margin for error on IT initiatives. Expect decision makers to be increasingly strategic in their the selection process for IT solutions.
Solution providers with high quality trials on-demand will have the competitive advantage.
