In today’s competitive, connected, and compliance-focused landscape, running an oilfield services company is often quite a challenge. The backbone of the energy industry and a key player in a variety of others, few industries can say that their products and services are used in some form by every business and consumer that exists—every single day.
Growing demand for oilfield services presents hope and challenges
Whether oil is refined and used for fuel, heating, lubrication, asphalt, or plastics, oilfield services companies can say that they play a vital role in the day-to-day lives of more than seven billion people and will continue to do so for decades or centuries to come. That said, with U.S crude production expected to set annual records through 2027 and remain greater than 14.0 million barrels per day (b/d) through 2040, the market for companies in the oilfield services industry continues to grow and become more competitive.
With increased demand for your company’s services, your ability to remain competitive will rely on your ability to provide continued financial and operational sustainability. Too often, however, the ability to see the big picture becomes much more convoluted when you grow—especially if you are employing manual, disconnected processes.
The risks of avoiding new technology for oilfield services companies
Even in the past few decades, technology has advanced in the field to increase cost control, efficiency, and reliability. Unfortunately, for many firms, the finance team hasn’t been as lucky.
Many firms, either reluctant or opposed to taking on a massive technology project—especially one that doesn’t contribute directly to the services they provide, have fallen behind their competitors who have. In fact, those who feared the risk of an implementation failure have actually set themselves up for risks in other forms.
In the oilfield services world, process is vital—everything needs to happen in a specific order. Sadly, when it comes to things like invoicing, expenses, and financial management, workflows are often disjointed. This becomes even more of a concern for companies working in multiple locations often hundreds of miles apart.
For example, think of the process of approving and billing tickets. How long does it take and how many people have to participate?
Too often, companies like yours rely on a mess of scanners, spreadsheets, and email to process paper field tickets. One slip up along the line—a finger slip when entering a ticket information into a spreadsheet, people who end up working on multiple versions of a spreadsheet, or a missed ticket—means that someone has to backtrack to find out what went wrong and fix it. Worse yet, if the process takes a month or more before the customer even sees (and rejects) an invoice, your team has to go into scramble mode to find and rectify the error.
It goes further than field tickets too, budgeting and planning often relies on the same spreadsheet and email-based communication, it becomes easy to lose track of consumable- and rental-based inventory, and hard to keep track of compliance and more.
In today’s world where information travels faster than ever before, noncompliance could be extremely dangerous—not only in the form of cost, but in the form of reputation as well. This is especially true for oilfield services companies who have to answer to a variety of regulatory agencies.
Unfortunately, without the right technology, it becomes quite easy to lose track of your operations and potentially fall out of compliance. Staying on top of risk assessments, testing, incident capture, emissions measures, and hazard monitoring controls is a necessity, but if you’re spending hours or days trying to understand whether or not you are in compliance, you are putting yourself at risk.
Equipment and inventory issues
Whether it’s consumable inventory, tools used in the field, or rented equipment, knowing where everything is, how much it’s being used, and how much revenue something is generating presents a challenge.
You need real-time visibility into the location, rig supply, availability, and utilization of all equipment and tools required for oil drilling and operations. The right technology can help you to keep track of this, but without it, you run the risk of unexpected downtime or stockouts that cut into your margins.
Overcoming oilfield services challenges: How ERP fits in
As the oil and gas industry continues to develop and opportunities to grow your business arise, you need efficient processes in place to remain competitive. Now is the time to remove the obstacles that interfere with your productivity and make sure that your business has the tools it needs to prosper.
NexTec has the industry experience, technical know-how and the solutions to guide you to new heights. We’ll help you select the right software and process that connects your business and gives you the insight you need to make the right moves. We work with world-class technology providers, like Sage, Microsoft and Acumatica, and have a nationwide network of consultants with deep expertise in the oilfield services industry. Get to know more about the benefits of ERP, CRM, and BI technology for the oilfield services industry here, learn more about our services, and contact us for a free consultation.