Oil & Gas
Oil & Gas Industry
The oil and gas industry operates within a traditionally volatile marketplace. Rising demand and constant cost fluctuations are all part of the oil and gas vertical, and supply chain managers have to know how to navigate the ebb and flow of operations within this industry. An inefficient supply chain operation can be devastating for these organizations, because the ever-changing nature of the field demands high productivity and effective forecasting, among other key variables.
Operations managers need to have all of the appropriate data in front of them to make informed decisions about where to send resources, how much inventory to keep on hand and which drill sites offer the most profitability – both now and in the future. The industry experts at Inspirage can help supply chain managers navigate the complexities of their operations.
Within the Oil & Gas industry, there are several key players that have important roles in the supply chain. Companies will generally fall into one or more of the following categories:
- Oil Field Services – These companies help drilling companies set up oil and gas wells. They manufacture, maintain and repair the equipment used in exploratory ventures.
- Exploration and Production – Organizations that focus on finding and extracting oil. This is generally a high-risk, high-reward sector.
- Upstream – Upstream businesses are the ones extracting the oil and sending it through the supply chain to the distributors.
- Downstream – Downstream oil and gas organizations are the ones that represent the commercial side of the business. This can include gas stations and heating companies.
- Conventional Exploration – The conventional oil drilling process involves drilling for oil wells and having the oil flow out of the ground. Conventional exploration strategies are less expensive than other methods.
- Unconventional Exploration – This kind of oil exploration is more expensive than its conventional counterpart. The kind of oil is the same; the main difference is the price at which these products are extracted. Unconventional exploration generally involves pushing oil and gas horizontally through the ground using a process called hydraulic fracturing.
How does Inspirage help each level of the oil and gas industry keep up with changing demand and volatile prices? We offer a range of solutions geared toward different challenges unique to the field.
There are a number of challenges that companies within the oil and gas industry face. These problems don’t just stem from oil availability; there are questions of demand, market volatility and supply chain distribution that also need to be addressed before anything else can be accomplished.
The challenges faced by the oil and gas industry can make their way into any part of the supply chain. Delivery of inbound drilling materials, transportation of the extracted product to the end location and sending workers to remote locations with necessary supplies are all things that supply chain managers have to take into account.
Oil and gas operations are complex, and there are a lot of challenges to overcome in order to ensure the supply chain is efficient, effective and properly resourced. Supply chain leaders have a laundry list of things to keep in mind:
- Supply chain distribution optimization
One of the biggest challenges for companies in this vertical is making sure supply chain distribution is as optimal as possible. Keeping up with demand and remaining competitive requires companies to reevaluate their supply chains whenever prices increase or decrease.
- Changing oil locations
Another key challenge lies in the fact that operations sometimes need to move. Locations where oil can be found continue to change, which means companies have to move people, resources and equipment to where new oil wells crop up.
- Redesign and redeployment of existing assets
Asset redeployment involves taking underutilized or idle assets and using them to increase return on investment. When assets like machinery are still usable, organizations can save money by redeploying them instead of buying all new equipment. Companies need to strategize how to use their existing assets to achieve better results for the same cost down the line.
- Reuse resources to keep inventory down
One strategy that companies utilize to make their operations run more smoothly and keep inventory at manageable levels is by reusing resources like water.
- Importance of projections
In any data-driven environment, it’s critical that the supply and demand projections given are accurate. The oil and gas industry especially feels the pressure to ensure projections are met, because the price of oil is constantly fluctuating.
- Cost consciousness
Cost containment and consciousness strategies are important for oil and gas companies, especially if they want to foster sustainability. The industry is reevaluating its operations, and the only way long-term sustainability can be achieved – especially in light of extreme cost fluctuations – is by adopting effective cost-management strategies.
These challenges require specific responses. To that end, Inspirage has developed solutions to meet these situations. Some strategies include:
- Demand planning
- Sales and operations planning
- Supply planning – distribution and materials
- Service parts forecasting
- Supplier collaboration
- Production scheduling
- Order to cash processes
- Procurement processes
- Order Promising
In order to meet these various challenges and make sure supply chains are functioning in the most efficient way possible, Inspirage has developed solutions geared toward using supply chain data to jumpstart projects, reduce risks and improve time to value. In our repertoire, we have over 100 pre-built solutions that leverage Oracle applications to achieve these goals – and we are building more every day.
Building an efficient, productive supply chain depends on the use of data-driven insights to improve operations and understand where to send resources. A true end-to-end strategy is necessary here.
We use our industry expertise to navigate Oracle deployments in order to elicit the most value. With our solutions, companies can create master schedules, develop comprehensive time-to-market plans and manage assets effectively, all within their Oracle modules.
To learn more about our oil and gas solutions, contact the software consulting experts at Inspirage today.