“Not now”: No excuses for digital transformation

Posted: June 24, 2024

Among the 700+ refineries in the world, relatively few have digitally transformed their operations or value chain management.  They have digital tools, but these are either lack the ability or are not currently used to discover opportunities, nor to address the challenges of the digital revolution. Why aren’t they taking advantage of the promises of digital transformation offers?

Four common excuses

Organizations justify the status quo with several explanations. Some of the most popular include:

1. They are busy on an enterprise-level initiative and don’t have the bandwidth to handle more challenges.
2. They are still developing their internal solutions, and aren’t ready to consider commercially-available solutions until they have finished their own development.
3. They are working through a series of proof of concept (PoC) projects, and they must complete these before they can consider commercial solutions.
4. Their “digital maturity” is far too low to apply digital tools.

Two reasons that now is the time for digital transformation

However, these objections fail to pass muster when you consider two truths that hold for every refinery across the world:

• It takes several years to evolve a culture.
• It takes several years to manage the workforce transition.

For both the workplace culture and workplace digitalization, refineries are facing a ticking clock. To address both of these two factors as they move into the future, refineries need to begin the process of transformation immediately.

Six common problems in implementing digital transformation

In beginning this journey, refinery owners and operators should know that there are many cases where refineries have successfully implemented the necessary changes quickly, at scale and with high user adoption. However, there are also some cases where refineries have experienced failures.

Here are the six most common failures to avoid:

The graphic begins on the left with the problem of the “DT ‘chasm,’” which is related to a series of delays that can last more than four years. In this first problem, teams get hung up by focusing on proof-of-concept and custom/bespoke development activities. The graphic positions this activity as being on the upslope of the roller coaster. When refineries successfully implement digital transformation, they rely on methods to put in place programs while minimizing risk and “failing quickly”. They focus on “when,” not “if.”

The second element is insufficient “work transformation.” When this happens, teams get lost in conversations dominated by “digital twin,” “AI,” “analytics,” etc., but the work hasn’t sufficiently transformed to become much more proactive, analyses performed more than 10 times more often by 100 times as many users, and other significant changes occurred.

The remaining four instances of problems are simply varieties of inappropriate implementation.

Strategic alignment and the keys to successful implementation

When you successfully implement digital transformation, you have to manage a series of projects within an overall program. This requires strong and frequent interaction between the five elements summarized in the following diagram—people, processes, technology, metrics and strategy:

In a successful program, we often see that the thought process and ensuing conversation focuses on layers.

It is also helpful to consider “digital twin” from an integrated, single perspective:

This improved perspective works complements a program of strategic alignment and execution:

When you take such an approach, you don’t have to suffer extensive delays at the start (the upslope of the rollercoaster cartoon shown earlier); each focus area, target procedure, or type of refinery process can be transformed almost simultaneously with similar activities for other procedures or types of refinery processes. When you plan in this way, you can gather and reuse the lessons you learn and the innovations you implement across your processes.

Find out more about how to implement digital transformation successfully. Learn about “zero flaring”—a key technique to increase your refinery’s efficiency. Read about it on our blog.