Oil & Gas UK and Deloitte analysis suggests collaboration in offshore industry increasing

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Stephen Marcos Jones

Results of a survey on collaboration between operator companies in the North Sea oil and gas industry and the wider supply chain indicate that the sector is heading in the right direction and becoming more collaborative.

Key Findings

  • The Operator Collaboration Index (CI) score moves from 5.9 to 6.7 out of a possible 10 based on almost 400 pieces of feedback on all major North Sea operators
  • Analysis suggests North Sea operators becoming more open and are engaging the supply chain earlier in projects
  • Operators are now more likely to be proactive in seeking out new ideas and solutions from suppliers

Receiving direct feedback from companies in the supply chain about their dealings with all major operators across the North Sea, the survey found that on a scale of 1 to 10, the Operator Collaboration Index (CI) score has moved from 5.9 to 6.7 between summer of 2015 and March 2016. This strongly suggests operators are becoming more collaborative with the wider supply chain.

Oil & Gas UK’s Efficiency Task Force (ETF) launched the Industry Behaviours Charter at the end of 2015 – a collective commitment to encourage companies in the offshore industry to make a collective commitment to work effectively, efficiently and co-operatively. In order to take an informed view on how industry is performing against the principles set out in the Charter, Oil & Gas UK commissioned Deloitte to reposition its independent Collaboration Index to review where the sector is successful and where it needs to improve.

Oil & Gas UK’s director of business excellence, Stephen Marcos Jones, commented:

“Our members are telling us that it’s vital the offshore industry pulls together to face what is a challenging time the sector. That’s why Oil & Gas UK, though it’s Efficiency Taskforce, will continue to focus its efforts on being a catalyst for positive change.

“We’ve seen examples of how increased collaboration has been successful in the aerospace and automotive industries, so we’re pleased to see green shoots of success from the offshore oil and gas industry. It’s essential now we work to nurture greater cooperation so will be asking those operators who scored particularly highly to work with us on sharing examples of good practice.”

“We will work with Deloitte again later in the year to repeat the survey to ascertain whether we’re seeing a longer term trend.”

Geoff Gibbons, a partner at Deloitte who lead the research, added:

“The first phase of our joint project with Oil & Gas UK has yielded a very robust initial dataset and early insight into the quality of supply chain collaboration in the UKCS. Our confidential benchmark analysis helps companies understand how they perform compared with their peers, what they do well and what they can do better.

“Future phases of the project will not only show trends emerge and develop over time, they will also highlight the impact of individual company efforts to improve collaboration and help companies identify areas for further improvement.

“We look forward to continue working with Oil & Gas UK and its members to support the industry for a better future.”

In total almost 400 (392) individual pieces of feedback were received, which provides more than 20 pieces of feedback from the supply chain for each of the major operators in the UK Continental Shelf.

Detailed analysis suggests that operators are becoming more open and are engaging the supply chain earlier in projects and are more likely to be proactive in seeking out new ideas and solutions from suppliers.

The new insight also reveals that smaller companies, those employing less than 2.500 people, appear to be more positive about collaborating with operators than those from larger companies, ie those employing more than 10,000 people.

Incentivising collaboration by financial means and through contractual terms are still the lowest scoring areas and as a result, the next phase of the ETF will look specifically at efficiency in procurement.

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