Every oil and gas operation faces periods of economic uncertainty at some point, and cost-cutting strategies become top priorities to allow business to continue. Often, decisions regarding trimming expenses are difficult, particularly in the human impact these decisions create.
One of the most common knee-jerk reactions to reducing expenses is to reduce your daily headcount but running lean doesn’t always make a business more profitable. In fact, such a move can have quite the opposite effect if you don’t first change the way you work. Without examining other opportunities associated with operations, the successes you achieve in mindlessly cutting costs can erode over time and leave you desperate to find new solutions.
When determining ways to save money, oil and gas consultants can serve as a valuable resource to address challenges specific to the industry, find untapped opportunities, and allow you to save more than you spend on consulting services.
Manage Priorities, Not Just Projects
Every project should be guided by prioritized business objectives, but companies often find themselves entangled in the details and lose sight of the larger goals. If you’re not making progress toward those objectives, the time and resources you spend on that project are wasted opportunities.
Working an O&G consulting firm can help you redefine your focus and direct your efforts toward goals, not just time-filling projects. Companies can build on their fundamental purpose and intentions to bring clarity to every project that will set them apart from their competitors.
Maximize the Utilization of Working Capital
Making better spending decisions with your working capital isn’t often viewed as a cost-cutting strategy, but it does play a vital role in your business’s ability to operate and grow. By definition, working capital is the difference between what your business owns and what it owes. It’s the cash reservoir that funds your day-to-day, and if there are leaks in the system, you could be missing valuable opportunities to pull back your spending.
An oil and gas consultant can help you identify opportunities to maximize your working capital, including:
- Paying suppliers on time
- Working with alternative lenders
- Improving procurement and inventory
- Streamlining the receivables process
- Identifying and itemizing all contract charges and expenses
Achieve Operational Efficiency
Trained industry consultants provide two-sided solutions to achieving operational efficiency:
On one end of the spectrum, consultants can determine best-fit systems that align with organizational goals and priorities. Consultants take into account a variety of elements, including industry trends, capital needs, and long-term objectives to develop effective operational strategies.
On the other end, your consultant can provide employee training and onboarding that will enable the systems to work in the way they were designed. Users are educated and empowered to run the company using approved processes and methods, which also creates efficiency in turnover and staffing.
Improve Organizational Effectiveness
For oil and gas companies, the keys to a successful future are predictable growth and realistic planning. These are achieved by ensuring the organization is providing effective services to its customers and stakeholders, and companies need direct insight into the experiences it creates to know how to move forward with confidence.
Consultants can help to build a higher level of confidence across the organization to ensure you’re meeting core business objectives and growth targets.
Develop Impactful Business Strategies
Using a third-party consultant brings a level of objectivity to the conversation, helping to foster better communication and collaboration internally. Even if the work itself isn’t complex, the consultant can help to sort through ideas, develop procedures and processes, and allow companies to reach their end goal quicker and more efficiently.
In addition, taking a methodical approach with a consultant allows the business to build systems and flexibility that will enable them to become more agile and responsive as future needs shift.
Empower Strategies with Digital Technologies
Many cost-cutting strategies are supported by implementing digital technologies, but sourcing the right technologies creates an entirely different set of challenges than the ones companies are trying to overcome in the first place.
In addition to identifying problem areas and deciding how technology can fill the gaps, companies are also saddled with exploring the vast number of options available. It’s time-consuming to find solutions, and even more resource-draining to conduct product comparisons, cost analyses, and long-term planning.
Ideally, you can work with an oil and gas consulting service that can do or has done much of this research for you and can easily identify opportunities for implementing digital technologies into your ecosystem.
Influence Cultural and Behavioral Changes
Systems and processes can be worth their weight in gold, but only if your company culture and employee behaviors and sentiments will allow them to work. Ultimately, your people are the ones pulling the levers and pushing the buttons, and their attitudes and ability to think and adapt will be a large factor in the success of your overhaul.
An outside consultant not only provides employee training, but can also help company leaders introduce the changes, plan the rollout, and gain user buy-in to maximize the effects of your investment. Large-scale changes must be supported by the culture and behaviors within the company to make the changes stick.
O&G consulting firms can provide expert guidance to help you not only save money, but focus on cutting the right expenses that will continue to deliver cost savings over time. At SPRI, we’re focused on delivering long-term outcomes that will allow our clients to become more resilient during economic uncertainty, more efficient in daily operations, and better positioned to take advantage of opportunities to build value for your stakeholders.
Reach out today and let’s discuss how we can help you remain competitive in the industry and go forward with confidence.