BLOG: Digital Investment Needed for Offshore Talent Shortage

BLOG: Digital Investment Needed for Offshore Talent Shortage
Oil and gas companies need to invest now in digital technology to offset a future talent shortage, an official with Booz Allen Hamilton tells Rigzone.

Consulting firm Booz Allen Hamilton believes that the oil and gas industry will face a shortage of skilled workers once the oil and gas industry recovers. The shortage is expected as many laid off workers move into other industries, and college graduates shift to more stable industries, Jim Kolodgie, principal with Booz Allen Hamilton’s civil and commercial group, told Rigzone in an interview.

Karen Boman
Karen Boman, Senior Editor, Rigzone
Senior Editor, Rigzone

Another reason for this shortage is that most companies are behind the technology curve with regards to advanced technologies for intelligent automation of reliability, human resource process optimization, global logistics and enterprise supply chain management, Kolodgie explained. Instead, capital is being redirected to critical programs and away from potential game changing operational technologies.

Booz Allen Hamilton also anticipates a shortage of skilled workers willing to travel to unstable regions for oil and gas work.

Referencing Malcolm Gladwell’s book "Outliers" – which discusses how it takes approximately 10,000 hours of practice to achieve mastery in a field – Kolodgie said he believes it takes longer than 10,000 hours for workers in the upstream and downstream oil and gas industries to fully understand their work. This will leave a significant capability hole.

“We believe that those visionary companies that bite the bullet and invest now can change the skills dynamic through automation of simple decisions, faster and deeper insights to solving a problem’s root cause and not the symptoms, and virtualizing the remaining experts so they can be leveraged globally without leaving their office,” Kolodgie commented.

In a recent report, McKinsey & Co. recommended that oil and gas companies consider digital technologies as a solution for boosting efficiency to create additional profits from existing capacity. McKinsey & Co. reported that effective use of digital technologies in oil and gas could reduce capital expenditures by up to 20 percent. It also could cut upstream operating costs by 3 to 5 percent and by about half that in downstream.

Investment in new technologies such as the Internet of Things is expected to eliminate some jobs, but create other work opportunities. In the case of IoT, field automation may eliminate some field jobs, but create jobs in a company’s central office, where fields are monitored remotely.

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at


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Tim Pegler | Oct. 13, 2016
I agree that an upcoming technological talent crisis is coming, however it seems to me wise companies could help mitigate it by retaining the talent they are letting go, many with tens of thousand of hours of experience. Our college grads have hopefully learned some book smarts, however experience is the only solution to understanding todays complex systems. I believe that hiring managers need to begin to look outside the box, instead of relying on computer algorithms to pick the proper candidates. I see it time and time again where valuable talent is bypassed because the hiring manager or the software they use cannot see the POTENTIAL in a candidate. Most O&G companies want young talent because the older generation who have been around, will not be around much longer. I believe if companies sought out and retained this aging talent to train our fresh recruits, the industry will be in a much better position to handle the upcoming technological requirements. Modern systems are very complex, especially on the automation side, and risk analysis and reliability studies must be performed. The old timers have been bitten by all the weaknesses in these systems, through experience and troubleshooting. This knowledge will only be passed down through word of mouth and mentorship programs. I am a huge proponent of documentation and procedures, as this root cause analysis. This does allow someone without the pertinent knowledge to gain valuable insight based on Lessons learned. Companies should capitalize on these lessons, and document them well.

lana r | Oct. 13, 2016
There is not a shortage yet as the price of oil is still too low to trigger an increase in drilling activity. The shortage is expected when the industry stabilizes.

tnt | Oct. 12, 2016
My Husband has worked for the same company for 17 years . He worked his way from the rig floor all the way to the office as an operations mgr. in Nigeria .If there is a shortage why in the heck has there not been one response to a perfect cv with great credentials .? I dont get it


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