PROBLEMS ARE OPPORTUNITIES LOOKED AT DIFFERENTLY

Problems are defined as “a matter or situation regarded as unwelcome or harmful and needing to be dealt with and overcome.” Most problems can be solved and depending on the solution attempted, or “opportunity” can create lasting value greater than the initial problem.

Reflecting on this subject I thought it beneficial to discuss the Oil and Gas industry in Canada. Oil and gas is a commodity business which is based on commodity cycles where prices are high and low. During high price cycles the industry enjoys great profitability and provides employment for many Canadians both here and around the world.

Low price cycles always bring about layoffs, corporate consolidations and reduced activities. What is interesting to note is that after every low cycle the industry generally comes out stronger and better able to deal with adversity. These periods are usually periods of reflection and change. Change comes in the form of lean organizations, significant adjustments made to service industries that support the companies, and generally the advent of new technologies that help organizations run leaner, find more oil and gas and compete more effectively. Necessity is the mother of invention.

We are now experiencing another decline in commodity prices and it is our belief that new ways of doing business, lower cost structures and greater creativity and productivity between producers and vendors will be the focus of the industry. Technologies generally play a significant role in reshaping cost structures and supporting different ways of running and managing the business. It is our expectation that this new cycle will again bring innovation focused on reducing cost structures across the industry either through new ways of drilling or through increased technologies that reduce costs between producers and service providers.

We believe that you can take advantage of technologies that exist and you can also participate with us in finding better ways to do your business. Stay tuned for our next article which will specifically talk about “reducing the friction and costs that exist between suppliers, buyers and producers”.