Low oil prices make it a top priority to reassess all conventional ways of conducting business.
While an ERP strategy leads to significant cost savings, it’s still considered complex and time-consuming rather than beneficial by some Oil & Gas companies. The fact is, this used to be true, but when focusing on best practices and a template-based implementation approach, efficiencies are achieved faster than before. Another way of looking at this is to consider the real value an optimized and automated process can add to your operations. The best way to get through the current downturn and to come out with an increased competitive edge is to focus on internal improvements—now.
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As the average oil price has halved in the space of 12 months, no part of the Oil & Gas industry is left unaffected. The pressure is on for offshore mobile asset owners, challenged as they are by multi-company structures, global supply chain, resource optimization, visibility across an ever-changing global fleet, project control, and management of investments on top of the financial problems. Other industries, like the automobile industry, have continuously worked with streamlining their processes. Meanwhile, the Oil & Gas sector has focused merely on capacity and maximum utilization within the regulators’ HSE standards.
Oil & Gas companies that want to remain competitive need to leave no stone unturned. But how do you pursue cost optimization without compromising on operational excellence? If not a magic wand, both EOI and ERP are reliable tools that enable you to do just that in order to start competing on cost. What about ERP implementations being complex, expensive, and without desirable ROI then? Take a look at these benefits experienced by IFS’s clients after implementing IFS Applications:
- Joint operational and maintenance planning—a joint operational (mobilization, operation and de-mobilization) and maintenance plan (preventive, predictive and legislative/class requirements) provides a new level of overview—a forecasted asset utilization, cost and resource requirements plan.
- Inventory stock optimization—joint planning, corporate part standardization and inventory visibility across the fleet reduce overstock, not only for a single asset but across the entire fleet. In addition, clients achieve a forecasted fleet resource requirements plan, a known demand plan, e.g. a 5-year rolling forecast.
- Improved spend on frame agreements—clients achieve bargaining power, taking advantage of forecasted global requirements, and, when the supplier is a global player, frame agreements are negotiated, for both suppliers of goods & services and 3PL companies.
- Centralized key operational support functions—standardization of equipment, maintenance plans, part catalog, suppliers etc. across a global fleet not only reduce overheads by centralizing operational support (e.g. asset integrity, supply chain etc.), but also maximizes the turn-around of integrating new builds and acquisitions into the company’s operations.
- Fleet-shared capital equipment—in an industry where equipment costs are high, operational utilization pushed to a maximum, and HSE standards of first priority, capital equipment shared across the fleet is a proven concept. Clients achieve capability to respond more quickly to market demands (e.g. the availability of risers across the fleet) and maximize uptime (e.g. an offshore thruster exchange due to re-certification requirements).
- Improvement of inventory value and utilization of actual purchasing costs
- Process time savings thanks to finance process automatization
- Improved project forecasting and better cost control
Together, these are some of many improvements that can lead to a total reduction in operational costs by 20–25%. Needless to say, that puts you in a completely new position.
Proven, no-risk solution
Many leading Oil & Gas companies rely on IFS Applications to realize efficient operations. Our longstanding expertise and proven track record of successful implementations make us a trustworthy partner. IFS Applications is designed to address Oil & Gas issues; its foundation is onshore/offshore operational integration across a global fleet, connecting the entire value chain in providing a full line of sight. It brings about increased control, real-time information sharing, and the possibility to instantly see all costs, enabling you to accurately forecast and improve decision-making. What’s more, IFS also makes available the entire library of documented best practices and processes, allowing for IFS Applications to be implemented on time and within budget, and supporting both project and training.
IFS Applications empowers you to deliver your projects, eliminates unnecessary costs, and reduces capital investments while maintaining operational excellence. An ERP strategy with IFS is profitable and offers direct monetary benefits—with a rapid ROI within reach. What are you waiting for?