Oil & Gas Consulting 101: Elements of Successful ETRM Implementations
Oil & Gas Consulting projects are about as varied as they are complex. More than likely, oil & gas consulting firms will be tasked with one of the most common and necessary projects in the space: an ETRM (Energy Trading Risk Management) system implementation. A robust ETRM system has become a crucial element to the operations of many oil & gas firms today. The deployment of one of these systems can prove to be an expensive, time consuming endeavor and (more often than not) extremely challenging, so avoiding issue ridden implementations is in the best interest of all parties involved. Listed below are a few key elements present in successful ETRM implementations conducted by oil and gas consulting firms.
Managing client expectations in any field is challenging, especially in the shifting arena of technology projects. While it’s important to assure your clients that their needs will be addressed with quality and care, you must work to manage their expectations for the project as a whole. One of the reasons this is necessary here is that ETRM solutions are rarely “out-of-the-box” applications. A large amount of configuration effort is usually required to align the solution to a client’s business needs. Core expectations on the new solution’s design, build and delivery must be communicated and agreed upon early by the client, implementation team and vendor.
Skin in the Game
No matter how impressive your team may be, you will ultimately need a degree of active participation from the client side. In a perfect world, the project team would be a combination of your team and representatives from the client’s impacted organizational areas or “end users”. Problems arise when an implementation has an unhealthy imbalance of consultant and client effort in the project life cycle. A way to combat this is to establish clear and present executive backing or sponsorship on the client side as a means to bolster the resolve to move forward. Without proper sponsorship, you run the risk of losing users’ participation during the project, since it doesn’t appear to them to be a priority for their organization.
Having a Plan vs Drawing One up In the Dirt
Sometimes a little improvisation in life can be rewarding, like winging it on a wedding toast or letting your 4 year old nephew set your 401k allocation (do not do this). Needless to say, that isn’t the wisest approach for delivering large scale implementations. A loosely focused approach can introduce significant risk to the project, especially if requirements, personnel and tasks aren’t clearly aligned to the overall project timeline. An oil and gas consulting implementation team must approach the project with a clear and, preferably, tested methodology to outline the union between the system and the stated business needs of the client. This plan then serves as a road map for the project’s key personnel on the various tasks needed for project delivery.
Avoiding Scope Creep
“Scope Creep” is exactly what it sounds like. It’s a process that starts with seemingly insignificant modifications and ends up resulting in extending the project timeline and, in some cases, crashing the project before it’s even finished. Capture the project scope by documenting requirements for each phase of the project life cycle. Each phase should then be given its own schedule and objective. Any scope definition must be reviewed and agreed upon by both client stakeholders and the implementation team, before official sign-off can occur.
In some cases, changes to scope are unavoidable. They can also dramatically impact the cost, schedule, and overall quality of the entire project if not managed responsibly. Having a documented process in place that facilitates scope changes is a must for every project. This process must define how to proactively identify, communicate and expedite new requests throughout the project life cycle. Proper change management protocol also allows for a better understanding of the projected impacts to project costs, as well as, potential benefits of the additional scope.
So What Does It All Mean?
ETRM implementations are difficult by nature and delivering them to a client successfully is equally as challenging for any Oil & Gas Consulting firm. A skilled oil and gas consulting team can add value to an oil and gas firm by avoiding common pitfalls that a company may otherwise face without the assistance of an oil and gas consulting firm during an ETRM implementation.