By Lance Mortlock, EY Canada Oil & Gas Leader

It's no secret that emerging technologies offer countless benefits to oil and gas companies — from achieving greater cost savings through increased efficiency, quality, control, speed and predictability, to helping improve safety and maintain reliable operations. If that’s not incentive enough to begin adoption, prolonged low commodity prices and the energy transition are creating more urgency for digital transformation as companies look for ways to remain competitive.

The challenge, of course, is the impact automation has on the workforce. A recent report between EY and the Petroleum Labour Market Information (PetroLMI) Division of Energy Safety Canada found that, over the next 20 years, technologies such as robotic process automation, artificial intelligence, natural language processing and machine learning — as well as a wide gamete of process technologies — could gradually reduce oil and gas workforce jobs by up to 30% and automate 50% of job competencies. 

The report finds that technical competencies (like managing finances, operations monitoring or quality control analysis) are twice as likely to undergo automation. That’s compared to leadership competencies (such as negotiation, persuasion or conflict management) that will continue to require human interaction.

One thing is for certain: though the impact to individuals will vary depending on profession, aptitude for change and degree of digital literacy, virtually no job will be untouched as companies undergo accelerated digital transformation in response to the COVID-19 global pandemic. This means that workers will have to upskill and develop critical leadership skills in emotional intelligence, critical thinking, data analysis and managing the interface between human and machine to be competitive in the future oil and gas job market.

The concept of “collective intelligence,” where machines and humans come together in complementary ways to complete tasks and activities, will be critical. Understanding the impact of automation on different competency types now can help individuals and organizations prepare for the operational changes and build a resilient workforce as the shift gradually takes place. That journey can begin now by taking a few key steps.

Step 1: Assess your current state and identify gaps

Understand your current workforce knowledge and skill sets to identify where your strengths lie and where there are gaps that need to be filled. This will help determine what is required in the form of upskilling or reskilling of employees, acquiring new talent and potentially outsourcing to another party. Automation can be helpful here to optimize HR processes and obtain data-driven insights to show how operating models need to shift to manage human and non-human workforces.

Step 2: Define your strategy and future objectives

Knowing what you’d like to achieve through automation is the first step in defining a digital strategy. And balancing short-term needs with long-term vision to critically assess the automation foundations needed to support the next and beyond is especially important. Companies must consider capital and resource allocation, integrating the long-range business plan and setting targets.

Step 3: Define your target operating model and organizational design

Operating model options run on a spectrum from centralized operations to federated at scale, with varying degrees of costs and benefits. Identifying the operational areas where you want to incorporate automation can help the company define its long-term strategy for implementing and managing new technologies in an integrated way. This approach also helps to plan out both the skills required, and the number of workers needed for implementation and sustainment.

Step 4: Shift culture to support the change

Transformation can’t exist in processes and systems alone. Companies must consider how they evolve the corporate culture to support change. Leaders can instill confidence by providing a clear vision of the end state, highlighting opportunities for career development and reducing the fear of job displacement. Increasing empathetic behaviors with others has shown to improve teaming and collaboration, which will be crucial for the effectiveness of cross-functional teams (think business, IT and HR working together to make automation a success).

In today’s environment, automation will be even more critical in remaining competitive. Realizing the complete benefits of new technologies will only be achieved if oil and gas organizations shift their back-office functions and operations to support adoption and enable their employees along the way. People are an equal part of the digital transformation equation — bringing them along the journey by helping them upskill, reskill and build a culture of innovation will ensure new technology implementations and the people involved reach their full potential. Understanding the possible impact on individual jobs and job competencies can provide valuable insight to help strategically plan the workforce of the future.

Lance Mortlock is the EY Canada Oil and Gas Leader, based in Calgary. For more insights on automation in the Canadian energy sector, visit www.ey.com/en_ca/oil-gas.