2017 Ustream Digital Survey examines the focus and investments upstream oil and gas companies are making in digital technologies.

1. DRILL
DEEPER
INTO DIGITAL2017 Upstream Oil and Gas
Digital Trends Survey

2. OVERVIEW
2017 UPSTREAM DIGITAL SURVEY
Examines the focus and investments upstream oil
and gas companies are making in digital
technologies.
Sixth-annual report on upstream oil and gas, surveying
more than 300 upstream leaders in 18
countries:
Respondents included members of executive and mid-level
management, business-unit heads, engineers and project
managers.
National oil
companies
International
oil companies
Independent
oil companies
Oilfield service
providers
> Commissioned by Accenture and in
conjunction with Microsoft
> Conducted in April 2017 by PennEnergy
Research in partnership with Oil & Gas Journal�

3. FIVE KEY FINDINGS
Greater gains
need analytics
maturity.
0201 04 0503
Companies
recognize power
of digital yet
struggle to
realize value.
Wider digital
benefits are
constrained by
organizational
issues.
Most oil
companies are
not taking
advantage of
digital to resolve
workforce issues.
Oil companies
fear becoming
noncompetitive
in digital race.

4. KEY FINDING 1
COMPANIES RECOGNIZE
POWER OF DIGITAL YET
STRUGGLE TO REALIZE
VALUE.

5. * Compared to 40% answering similar question posed 2 years ago
More than half* recognize the value of digital and are
looking to boost investment. In 3-5 years, over 70% plan
“more” or “significantly more” investment in digital,
transitioning to areas such as high-performance
computing, wearables, artificial intelligence (AI),
robotics, blockchain and mixed reality.

6. In the next 3-5 years,
how much is your
company planning to
invest in digital
technologies?
KEY FINDING 1
16.8%
22.7%
47.5%
8.4%
4.7%
Same
Don’t
Know
Less
Significantly
More
More
INVESTMENTS
LEVELS RISING

7. Which digital technologies is
your company investing in
today / next 3-5 years?
INVESTMENTS TODAY /
TOMORROW
KEY FINDING 1 KEY
Today
Over the next 3-5 years
Blockchain
Mixed reality
None of the above
Other
Cloud
Big data / analytics
Mobile devices
Wearable technology
Collaboration and social tools
IoT
Internet of Things (IoT) /
cybersecurity
High-performance computing
Artificial intelligence / machine learning
18.6%
Robotics and drones
31.1%35.1% 22.0%
10.9%
6.8%
5.6%
1.2%
2.2%
34.8%
32.9%
24.2%
11.5%
18.6%
24.5%
16.5%
29.8%
34.2%
28.6%
42.9%
46.0%
40.4%
40.7%
45.7%
40.1%
42.2%
28.9%
55.6%

8. More than a quarter (27%) quantify “significant” or
“high” value ($50-$100 million or more) from their
companies’ digital investments, most struggle to
achieve wider gains, despite over 70% expecting to
see fully digital oil fields within five years.

9. Can you quantify,
in terms of value,
how much digital
is adding to your
business today?
KEY FINDING 1 22.0%
15.8%
13.0%
3.7%
11.5%
14.3%
19.6%
Low
Up to $5
million in total
value
Average
over $5 million
in total value
We do not
measure this
value
High
Over $50
million in value
Don’t know NoneSignificantly
more
Over $100
million in total
value
DIGITAL’S
VALUE-ADD

10. The benefits of digital
extend beyond cost
reduction. Digital’s emerging
wave of value should enable much
greater productivity from assets
and people.
The technology focus is
shifting from analytics, cloud
and mobility to technologies such
as artificial intelligence, machine
learning and robotics.
Opportunities to realize
greater value will depend on
industrializing initiatives that
began as small pilot projects.
OPPORTUNITIES
KEY FINDING 1

11. KEY FINDING 2
GREATER GAINS
NEED ANALYTICS
MATURITY.

12. Big data/analytics ranks as the top digital investment
area (46%) in 3-5 years. Respondents rate
themselves as more mature in analytics than in other
digital technologies, but >50% are still implementing
relatively immature projects like big data storage.
As analytics accelerate to artificial intelligence and
machine learning, greater maturity is needed.

13. How mature is the use
of analytics within your
business ?
KEY FINDING 2
15.2%
18.0%
28.3%
14.3%
Mature
Novice
Localized
Semi mature
24.2%
Aspirational
MATURITY LEVEL:
ALL RESPONDENTS

14. KEY FINDING 2
Which big data and
analytics capabilities is
your company looking
at implementing?
32.9%
Advanced visualization
in traditional areas
50.3%Big data storage
33.2%
Data services (extraction,
transform and load)
17.1%In-memory computing
13.4%Edge computing
29.8%
Data sciences
personnel or tools
18.6%
19.3%Machine learning
Cognitive computing
27.0%IoT
Other 3.4%
CAPABILITIES:
UPSTREAM
FOCUS

15. Over 70% of respondents chose one of
the following four areas as their top area
for analytics investments:
Both asset management and drilling and completions had 5%
more #1 responses than in the previous survey.
Nearly a third believe the time frame for implementing
capabilities associated with analytics ranges between two and
three years, rather than immediately or in the long term.
The next wave of investment in analytics is moving the focus from
production surveillance to drilling and completions—possibly
indicating some recovery in exploration, as well as more
sophisticated use cases for analytics.
Asset management
/ maintenance
Drilling and
completions
Capital project
management
Production
optimization
+5%
1/3
NEW FOCUS
ANALYSIS
KEY FINDING 2

16. Analytics is evolving to artificial intelligence
and machine learning, areas in which competence
in oil and gas is relatively limited.
While many respondents self-assess competency in
statistical analysis in certain areas, oil and gas companies
need to develop maturity for the emerging wave of
sophisticated analytics.
OPPORTUNITIES
KEY FINDING 2

17. KEY FINDING 3
WIDER DIGITAL BENEFITS
ARE CONSTRAINED BY
ORGANIZATIONAL
ISSUES.

18. Compared to prior surveys, digital’s
importance in cost cutting has waned as
companies move to realize the benefits of
faster decision making, and shorter time
frames to first oil and gas. By its nature, digital
requires innovation but the “lack of clear
business case” is a major inhibitor.

19. KEY FINDING 3
What are the
top three areas
you believe
digital can
benefit your
company?
(Please select the top three in
priority order) 1
2
3
PERCEIVED
BENEFITS
OF DIGITAL
Faster time to first oil and gas 19.3% 5.0%9.3%
Lowering costs 7.8% 8.1% 12.1%
New ways of collaboration
across the supply chain 5.9% 11.5%3.7%
Better asset management 15.2% 20.2% 15.5%
Reduced risk due to
real-time decision support
18.9% 14.9%
Faster and better decisions 29.8% 18.0% 7.1%
Improved security
3.7%
4.3 4.7%
Better collaboration for improved
health, safety and environmental
5.0%
3.1%
8.7%
Material reduction of offshore
and onshore workforce 3.7% 6.2%
1.2%
KEY
12.1%

20. FASTER, BETTER
DECISIONS
SOLID BUSINESS
CASES
COST REDUCTION
DECLINING IN
IMPORTANCE
25% say the #1 barrier to digital benefits is lack of
clear strategy or business case
KEY FINDING 3
Using digital for faster and better
decision remains the top priority
in 2017 (as it was in the previous
survey). Gaining faster time to first
oil and gas moved to second
place for overall digital benefits,
compared to fifth position in 2015.
The cost-reduction benefit of digital
is receding in importance for
companies in the upstream sector.
In the previous survey it was cited
by 41% of respondents as one of the
top three areas for perceived
benefits from digital. In the current
survey, only 28% of companies
ranked it in the top three.
Many upstream oil and gas
companies are finding it
challenging to create solid
business cases for digital.
The lack of funding also holds up
digital advancement and greater
realization of value.
ANALYSIS

21. KEY FINDING 3
OPPORTUNITIES
Oil and gas companies can reposition
digital as a strategic conversation in the
C-suite, moving the focus from pure operational
efficiency to running processes and assets in an
integrated manner for greater value creation.
Cultural change is vital. The industry has
been developed to run as high-functioning silos to
maximize predictability and minimize risk. Digital, by
its very nature, requires innovation and a more
creative culture of trying new things and taking risks.

22. KEY FINDING 4
MOST OIL COMPANIES ARE
NOT TAKING ADVANTAGE OF
DIGITAL TO RESOLVE
WORKFORCE ISSUES.

23. Cost pressures mean achieving more with less. Oil
companies are using digital to upskill workforces and
leverage contingent labor, and nearly half say the top
workforce impact of digital is to boost productivity.
The majority sense being 3-5 years away from having
a solid base of digital skills.

24. KEY FINDING 4
Which of the
following are you
using to address
workforce
challenges?
Upskilling workforce in digital
skills relating to upstream 33.5%
Using on-demand labor platforms to hire
and manage independent workers 9.3%
Actively focused on creating a blended
workforce of independent/ freelance
workers and internal workers
14.9%
Using crowdsourcing platforms to
tap into skills networks 5.0%
Using open innovation networks
and processes
13.7%
None of the above 14.6%
Our company does not have workforce
challenges that need to be addressed 7.5%
Other 1.6%

25. How many years are
you away from a solid
digital skill base?
KEY FINDING 4
28.0%
11.2%
41.0%
8.7%
7.5%
3-5 years
3.7%
More than 10 years
1-2 years
6-10 years
Not sure
We have the skill
base we need

26. >60% CURRENT
CHALLENGES
SHORTAGE
BY 2025
KEY FINDING 4
More than 60% of companies
surveyed reported having lost
some of their workforce in the past
year due to digital technologies,
with the oilfield services sector
most affected. Among all
respondents, engineering was
hardest hit, along with production
operations.
As stated in Accenture’s recent oil
industry talent study, The Talent
Well Has Run Dry, the oil industry
is expected to experience a
shortage of 10,000 to 40,000
petro-technical professionals by
2025. Old talent strategies are
likely to fall short, and new skill
sets—including artificial
intelligence, machine learning and
robotics—are needed.
Among current challenges cited,
recruitment tops the list, followed
by creating a blended workforce
of independent/ freelance workers
and internal workers on-boarding.
ANALYSIS

27. KEY FINDING 4
A major opportunity lies in
rethinking what people are
doing, refocusing the efforts of
highly-paid talent whose time is
swallowed up by repetitive
activities. Brain power
needs to be refocused
on value.
Re-examine career paths to
make them more attractive
to young people, who value
innovation and creativity.
Take action now to increase
the chance of acquiring
digital skills before
competitors do.
OPPORTUNITIES

28. KEY FINDING 5
OIL COMPANIES FEAR
BECOMING NONCOMPETITIVE
IN THE DIGITAL RACE.

29. Respondents recognize digital helps address vital
challenges: cost reduction, capability improvement,
health and safety, and operational effectiveness, but
there is more. Digital is altering the dynamics of entire
industries. Without plotting a transformation journey,
companies risk being left behind.

30. What business
challenges do you
believe digital can
help address?
(Please rank all that apply,
1 = most important…10 = least important)
*Note: Only areas ranked as “most important” are shown.
34.2 %
11.2%
9.3%
6.2%
3.1
7.1%
6.8%
2.2%
1.9%
1.9%
Cost reduction
A shortage of people
with the right skills
Health and safety
Need for improved capabilities
Race for operational effectiveness
Adapting to new regulations
Need for better collaboration
Reigniting growth
Innovation and R&D
Re-balancing the portfolio
KEY FINDING 5

31. 19% 18% 12%
39% say the #1 risk of lack of digital investment is
being non competitive vs. peers
Digital is already altering the power dynamics in asset-intensive
industries, and nearly 40% of oil companies are
worried about the risk of being left behind their
peers if they do not continue to invest in digital.
Companies recognize digital can help
overcome challenges, and the most
important ones cited:
Additional fears of insufficient digital
investments include:
inability to
transition to a
new energy
landscape
fears of
increased
cyberattacks
health,
safety, and
environment
Cost reduction
Capability and
skills improvement
Health safety and
environment (HSE)
General operational
effectiveness
KEY FINDING 5
ANALYSIS

32. KEY FINDING 5
Accenture’s Digital Performance
Index study for Energy shows leaders in
transformation go further to harness digital’s
power. They future-proof companies by
revolutionizing every element of their respective
industry’s traditional business model.
The rewards of innovation can be
long-lasting: Successful digital businesses pioneered
by early movers are extremely difficult to unseat, even
after billions of dollars of investments by competitors.
OPPORTUNITIES

33. CONCLUSION
Respondents to the 2017 Upstream survey recognize
digital technologies can help reduce costs, make faster
and better decisions, and boost productivity. Senior
executives need to become more involved in envisioning
how the next wave of digital technologies can lead to
breakthroughs in performance.
the focus needs to move from sheer cost reduction
to boosting asset and workforce productivity to
become more competitive versus peers.
FOR THE INDUSTRY
the next wave is transitioning to artificial
intelligence, machine learning and robotics.
WHEN IT COMES
TO DIGITAL
digital can be leveraged to achieve more with less,
and to develop a culture attracted to “the New*”
and making it a reality.
TO REJUVENATE
THE WORKFORCES

34. *Accenture is defining the context of the “New” as follows:
Our clients’ worlds are changing all the time. They are experiencing
demographic shifts (millennial), changing customer expectations
(the rise of the sharing economy), shifts in macro, social and
cultural trends (climate change) and, of course, emerging
technologies (digital, quantum computing, solar, etc.). When these
forces meet, they can cause major discontinuities and disruptions
for businesses and societies—as well as enormous opportunities for
organizations. As a result of the shifting environments, new
business models emerge. An organization’s core business is joined
by the nearby new business opportunity, which is driven by
innovations in new management practices and new technologies.
The new business allows companies to challenge conventional
practices and serve customers better, faster and cheaper than the
existing approaches provided by incumbent players.
Visit us at: Accenture.com/energy
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