Minding the gap between the front and back offices: A systemic analysis of the offshore oil and gas upstream supply chain for framing digital transformation

Abstract

AbstractThe offshore oil and gas upstream supply chain operations are part of a complex system with many stakeholders and intricate relationships. Traditionally, these operations are managed manually, which leads to inefficiencies. Despite the innovative and engineering‐orientated approaches adopted in other technical operations of the industry, the supply chain activities remain unchanged, relying heavily on legacy systems. However, cutting‐edge technology opportunities are available for adoption in supply chain management systems in the oil and gas industry. Such a transformative upgrade relies on first understanding the operational inefficiencies and preparing an accurate picture for how these operations should be performed. This study adopts a systemic approach to examine the oil and gas offshore supply chain operations of a case company to identify areas for improvement. The objective is to address the following research questions: (1) what is the current “AS‐IS” supply chain operations support; and (2) what is the desired “TO‐BE” state for these operations. This research adopts a soft systems lenses applied in an action research project to capture and analyze existing operations. The research revealed that information exchange is a major barrier, and that technology and organizational gaps are the primary hindrance for a digital transformation. The conclusion is that there is a need for a higher level of data exchange and increased data quality in any proposed transformation.