BLOG: Oil, Gas CEOs Confident of Their Company Growth, PwC Survey Finds
Production at record highs … $70 oil … jobs being added in the E&P sector … is this the recovery the oil and gas industry has been waiting for?
Seems to be – and to top it off – the optimism among oil and gas CEOs has returned.
Sixty percent of oil and gas CEOs believe global economic growth will improve in the next 12 months, according to a PwC survey of CEOs around the globe. The confidence was even more prevalent when the CEOs were asked about revenue growth within their own companies: 91 percent said they’re confident there will be revenue growth in the next three years while 83 percent are confident in growth within the next 12 months.
But where will that growth come from?
The survey finds that organic growth will be the main driver, with 83 percent of respondents saying they’re planning on organic growth to drive profitability in the next 12 months. This was followed by new strategic alliances or joint ventures at 60 percent, cost reduction (49 percent) and new M&A (39 percent).
“I think it’s interesting that 60 percent of CEOs said that they would be participating in strategic alliances,” Niloufar Molavi, U.S. energy and mining leader at PwC, told Rigzone. “Now they’re looking at partnering with other organizations that may be outside of the sector, such as technology, to bring their resources and innovation to help them transform what they’re doing and how they’re doing it.”
Developing Digital Talent
In the years following the industry downturn, oil and gas CEOs have been deploying different strategies to cut costs in their organization.
“It’s not just cutting head count; it’s how they’re doing business differently and how they’re using technology as a tool in a different way – both in the front and back office,” Molavi said. “CEOs have become more nimble using technology and data to be able to make faster decisions.”
The survey reveals that two-thirds (67 percent) of CEOs are concerned about the availability of digital skills in their workforce and 85 percent said they need to strengthen soft skills in their organization alongside digital skills.
But investment in digital solutions isn’t enough – companies will need new skill sets as well.
Nearly half of surveyed CEOs (48 percent) expect to increase head count and the resources and skill sets they’re looking for will more than likely be reflected by their need for digital talent, said Molavi.
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Senior Editor | Rigzone