The energy sector has probably been one of the early adopters of ERP systems. ERP plays a vital role in improving the operational efficiency by management of operation in real-time. Some of these processes include production monitoring, drilling management, equipment management, loss management, and many other operations.
Thus ERP standardizes and streamlines the business processes. This is particularly necessary for companies that have number of giant units scattered geographically within multifaceted supply chains with elevating competition.
ERP: The Need Of Oil And Gas Sector
Here are few ways in which ERP is beneficial:
ERPs are easily integrated with other subsidiary third party software prior in use in terms of scheduling and costing. Thus it helps companies to manage resources easily.
Efficient assessment of projects undertaken and also proper foreseeing of risks and potential threats is possible. Some sophisticated oil and gas software can come up with contingency plans when required thus adding a further step in business planning.
For any oil plant there are a number of on shore and offshore units that need to be managed simultaneously. ERP software helps in managing all.
ERP provides a simplified hassle-free approach covering all the major operational heads.
Things To Consider Before Implementing ERP
Now that we are aware of the advantages, it is also imperative to know that implementing an ERP is not a joke. It practically runs the business and it can completely reinvent the traditional tactics and strategies used in business. So when thinking about implementing ERP here are 5 top things to consider before:
Real Time Asset Management: With growing advancement of technologies the use of myriad of machineries are increasing. As more machines and facilities are being incorporated within the industrial sectors, the need for deployment and timely assessment are also experiencing an upward slope. Thus, asset control in oil and gas industry is of critical importance. Within this setup, the software components and the needs for controlling them also plays pivotal role. Thus, the ERP platform implemented should be able to handle all resources with equal efficiency.
Quality Control: Unlike other sectors, the oil and gas industry is driven by their R&D departments. Constant improvement in quality producing more refined product from raw fossil products drives the market. Thus QA is the first and most vital step in product supply chain management. So the ERP considered to be implemented should have various checkpoints to maintain all these aspects.
Integrations: It is extremely important to find an ERP platform that can integrate the core ERP platform with third party components, thus harmonizing the data flow from different instances of software ecosystem. This creates a 360-degree transparent view of data processing thus reducing a huge amount of time. So make sure the platform one has integrating capabilities.
Compliance And Policy Management: Companies in energy sector operates globally with various on-shore and off-shore units and trade services. Thus the oil and gas sectors are regulated by laws of various states, federations, and tribunals. Over the course, these rules and regulations become clustered resulting in utmost inefficiency. Thus the ERP platform should be efficient in optimizing and managing these clustered regulations.
Ease of Localization: Companies in this sector operate on a global range and thus their success solely relies on the ways of implementation and adjustment. The ERP thus demands factors to digest, post, and examine the multilingual substances for financial agreements. So make sure that ERP chosen should be able to provide the business a total expense structure of both direct and indirect expenses.
So after considering all these factors when finally an ERP platform is shortlisted, here are few last minute questions that you need to ask:
How exactly the ERP will fit into the business?
What are the competitive advantages that can be gained with the resources of that particular ERP?
How will the ERP mitigate risks?
In what ways it will manage compliance?
How well will it handle the local and global financial reports?
By answering all the questions and considering all the factors, a proper ERP implemented can ease the operational costs, streamline system, mitigate risks, and leverage the profit margin to a great extent.