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What obstacles can result in digital transformation implementation failure? This article explores common obstacles that hinder digital transformation success.
In the previous article, I described digital transformation technologies for oil and natural gas producers. You can read it at this link.
Oil and natural gas producers encounter the following obstacles to digital transformation. Plan tasks and resources to ensure your project can mitigate these obstacles that can stall or torpedo your project.
Lack of management support
Digital transformation projects, like all other projects, require management sponsorship. Management is paid to be skeptical about the supposed benefits of technological advances, including digital transformation. Build support by communicating your business case succinctly and avoiding exaggerations. Identify a champion for your project among the senior management team.
Problems managing data
Not surprisingly, digital transformation projects require lots of high-quality digital data. As discussed earlier in this series, inadequate data management processes are a common obstacle that undermines data quality. Plan to spend resources and budget to improve data management processes.
Problems accessing data
Digital transformation projects require access to multiple data stores. The complexity of data access is a frequent problem. Plan to spend resources and budget to transform data and perhaps copy it to a data warehouse.
Lack of cooperation across organizational silos
The scope of most digital transformation projects crosses organizational silos at oil and natural gas producers. Lack of collaboration or cooperation across various silos can slow digital transformation projects and undermine the business case. Ensure affected departments see benefits for themselves and participate actively in projects.
Project budget overrun
It’s easy to underestimate project costs. Data and integration difficulties will increase the effort required to complete digital transformation projects. Include significant contingency dollars in your project costs estimate.
Lack of resources or funding
Don’t start a digital transformation project without all the resources and funding in place, thinking that missing resources will appear later. Whatever is missing at the start will never appear later.
Lack of skilled staff
Digital transformation projects require specific data, application and technology skills to complete them. Expecting internal staff to develop these skills within the project duration is not a recipe for success. Plan to resource the needed skills internally or externally.
Challenges with existing or new technology
By definition, digital transformation technology is new and often comes with low reliability and software bugs. Include more dollars in your budget and extra time in your schedule to anticipate more testing.
Complexity of implementing new technologies
Implementing new digital transformation technologies often reveals unexpected complexities as the project nears production implementation. Plan to spend money on people change management.
Yogi Schulz is an information technology consultant who works extensively in the petroleum industry to select and implement administrative, operations, and geotechnical systems. He writes regular articles about developments in the energy industry and technology.
You can contact Yogi Schulz through his LinkedIn profile at this link.
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