[November 05, 2014] |
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Booz Allen Releases Annual Energy Sector Trends for 2015
MCLEAN, Va. --(Business Wire)--
The energy sector is in the midst of a major, global transformation -
driven by key forces that impact organizations' ability for strong,
long-term performance. These forces are creating demands that require
increasingly greater attention of oil and gas and utility companies.
True competitive advantage depends on an organization's ability to
predict and identify these changes before and as they occur, as well as
finding the right balance to manage them efficiently and effectively.
"Finding and producing energy will continue to get more complex with
increased demand, competitive challenges and new risk. Companies must
understand this new landscape in order to protect and optimize their
full spectrum of assets, investments and operations. Change is coming
fast, and the implications are complex," said Steve
Senterfit, a Vice President with Booz Allen who leads the firm's
work in the commercial energy market. "To thrive in the long-term,
energy companies must turn to an integrated effort that incorporates
strategies to capitalize on new techniques, better insights and more
innovative ways of approaching their business, suppliers, and employees."
To help commercial energy companies thrive in the new year, Booz Allen
has assembled its annual list of likely sector business trends for 2015
and beyond, many of them focused on the need to predict what's coming.
The list is based on conversations with CISOs, chief risk officers, CFOs
and other leaders in the commercial energy sector, as well as Booz
Allen's vast knowledge of the energy market and its strong commitment to
protecting companies' most vital assets.
The Top Energy Sector Business Trends for 2015:
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Experts agree: the energy sector is the greatest target for cyber
threats. No energy company wants to be the first "Cyber Macondo"
or "Cyber Blackout." Energy companies must move beyond simply putting
up electronic barriers to protect their IP, supply chain, operations
and networks and instead build the capability for proactive advanced
threat detection across a now multi-dimensional threat surface.
Coupled with this challenge is the weighty task of assessing the
security of third-party vendors and protecting critical business
assets from those who should not have access. And finally, in today's
cyber world, business continuity and crisis management plans must
include cyber incident response plans because nations, ustomers and
the industry cannot risk a digital disruption that results in major
physical, economic or reputational damage.
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The regulatory balancing act is more difficult. Complex and
changing national and local regulations, including environmental
requirements, will continue to force energy companies to balance risk,
cost and operational efficiencies to stay compliant. The industry must
navigate an alphabet soup - NERC (News - Alert), and NRC to name a couple - of
regulations that demand investment in a unified compliance framework
to implementing a sustainable institutionalized compliance culture,
especially when firms are operating in multiple jurisdictions and or
geographies.
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The risk model adds a new value: reputation. As customers begin
to realize they have energy choices, they are calling on oil and gas
and utility companies to answer the question, "Why should you matter
to me?" The result is that firms must spend more time understanding
their market ecosystem of customers, investors, communities and
competition. In addition, regulators are tying customer satisfaction
to rate cases, making reputation much more of a commodity.
Organizations that fully embrace using integrated techniques to
provide 360-degree awareness will have more insight into their
reputation and be better equipped to respond to events to proactively
manage risk across the enterprise.
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Health, safety and environment (HSE) gets predictive. The focus
on managing and minimizing HSE incidents will shift from a pure
training and process approach to one that integrates predictive and
preventative models. When firms apply advanced analytics techniques to
historical data, they can develop predictive models that identify
potential incidents before they occur. This predictive management will
be applied across energy companies' employees, suppliers, training and
processes to apply fit-for-purpose training and awareness.
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Capital investments will get predictive, too. Capital
investments have become increasingly complex and shareholders and
investors are paying closer attention to the risk payout. To prevent
excessive risk taking, cost overruns, or regulations slowing the pace
of progress or capital dilution, energy companies will need to employ
advanced risk analytics to analyze and quantify capital spend to
effectively plan for future needs, to predict potential issues and
execute successfully.
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The silver tsunami has struck. A major demographic shift within
the energy industry is underway that will leave many companies with
shortages of key skills: an aging workforce. In an industry where
innovation is a commodity, knowledge is certainly a new capital. The
key to surviving this generational handoff, and even taking
competitive advantage of it, is to carefully plan to ensure knowledge
continuity is maintained - just as a corporate enterprise plans for
business continuity.
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Data is creating opportunities and challenges. The emergence of
vast amounts of new data, from smart meters to digital
instrumentation, is presenting both an opportunity and a challenge
within the energy industry. While data has been viewed as an asset,
many organizations are struggling with how to transform data into
insights and a competitive advantage. Energy companies will continue
to invest in enhancing the customer experiences that deliver better,
faster service using mobile and social media platforms. In addition,
cloud and mobile technology are helping enterprises get the most out
of their joint ventures, but also must ensure security is a top
priority to reduce cyber vulnerabilities.
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Risk management must move from the backroom to the boardroom.
Energy companies know how to manage individual components of risk
related to HSE, IT, investments, regulations, and even reputation, but
those risks in total must be fully understood at the CEO and board
level because the combination of a failure in one or multiple
components could be devastating to a company. Having a complete
picture of risks at the highest level ensures that the company, and
not just a department or an asset, are being well protected.
More information about Booz Allen's energy practice is available here.
About Booz Allen Hamilton (News - Alert)
Booz Allen Hamilton is a leading provider of management consulting,
technology, and engineering services to the US government in defense,
intelligence, and civil markets, and to major corporations and
not-for-profit organizations. Booz Allen is headquartered in McLean,
Virginia, employs nearly 23,000 people, and had revenue of $5.48 billion
for the 12 months ended March 31, 2014. In 2014, Booz Allen celebrates
its 100th anniversary year. To learn more, visit www.boozallen.com.
(NYSE: BAH).
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