Why Operational Excellence is Essential During the Oil Price Downturn

The oil industry is going through a rough patch right now. It may seem dire with wells going offline and new exploration being reduced, but this is not the first time this has happened and it won't be the last.

During times like these, companies find themselves looking for ways to maintain productivity and revenue while limiting exposure to the markets and unnecessary costs. Operational excellence lies at the heart of these efforts.

If your organization is reeling from the market shifts and looking for ways to survive, then now is the perfect time to re-examine your operational expenditures, project management, and other critical processes.

It can be hard for companies to step back from the current crisis and see the big picture, but gaining a high-level view of the company, markets, and industry is essential to long-term success. Doing this now will help you spot opportunities for cost reduction and reinvestment while the market is down, and it will place you in a better growth position once prices begin to rise again.

Remember that the ability to look at your current situation through the lenses of operations, compliance, and quality management is a strategic strength. It gives you a perspective that balances data, business goals, and risk management. Organizations that use this approach will discover ways to do more with less and re-establish growth.

If your organization is weathering the current storm well, then you should take advantage of your balance sheet and relatively strong position to realign operations toward future investments and even better results once the downturn ends.

Firms in a good position can arguably benefit the most quickly from improving operations because they are starting from a strong foundation. That said, operational analysis and management still needs to be taken seriously and given attention. You cannot rest on your laurels.

Companies that commit to improving their operations and/or maintaining their already high standards will see their fortunes improve much faster than firms that ignore issues during the downturn. Firms practicing operational excellence or working towards it will be more agile and responsive to market changes during this cycle and future ones.

Operational excellence is an asset in itself and times like these prove it. Take a look at your operations now and be willing to make changes, so that you are ready for the future. If you don't, then rest assured that your competitors will and it will cost you.