Oil & Gas outsourcing set to grow in the next few years

Pune, India, November 2011

• An increased focus on engineering has entered the outsourcing space with services such as product design and automation for both upstream and downstream oil & gas companies
• The imminent retirement of close to half the industry workforce over the next decade has added a new area of concern for oil and gas companies
• Oil and gas companies are moving towards a global model which will synchronize their business processes across diverse working environments – a radical departure from how most have operated previously

The oil and gas industry is arguably the most economically important sector in the world as it meets more than two-thirds of the global energy demand. The industry is facing issues such as high price volatility for oil products, a shortage of talent, aging infrastructure, and constantly changing compliance requirements; apart from broader macro-economic challenges which include declining production, rising consumption and low reserves.

The focus of the industry is now on cost containment, increased process efficiency, a greater use of technology for exploration and refining, and better relationships with suppliers and vendors. As a result of this, there are opportunities for service providers in this domain to offer industry-specific solutions across the entire oil and gas value chain.

New research from HfS Research, the leading research analyst firm focused on outsourcing and shared services strategies, and co-authored by ValueNotes, a leading provider of business research, highlights the benefits of outsourcing in the oil and gas industry as major players in the market turn to service providers to address their business challenges.

Popular outsourced services include Energy Trading and Risk Management (ETRM), supply chain management, enterprise asset management, ERP platform integration, IT Infrastructure, and retail automation solutions. An increased focus on engineering has entered the outsourcing space with services such as product design and automation for both upstream and downstream companies.

It is estimated that as much as 50% of the energy workforce will retire by 2017. To prepare for a possible shortage in quality talent, organisations have started to document existing business processes and tasks, understand and capture best practices from their retiring workforce, and automate them using process models. The result is an interesting new set of offerings that service providers are working on to help the next generation of workers learn from past experience. In mature areas such as IT, F&A, and HR, the outsourcing industry can ease the pain of the retirement crunch just by supplying competent professionals to replace the retiring boomers.

Oil and gas companies are currently facing a combination of opportunities and challenges, including streamlining processes, automating design, and increasing the focus on alternative sources of energy. There is also greater focus on managing end-to-end components along the industry value chain. They are moving towards a global model which will synchronize their business processes across diverse working environments – a radical departure from how most have operated previously. The service provider landscape features a select number of providers offering end-to-end specialised industry solutions. These solution providers are focused on providing value beyond cost arbitrage by leveraging a combination of onshore-offshore delivery models and the use of technology.

Trends such as these have been explored in our report titled - How is outsourcing fuelling the oil & gas industry. The study investigates industry drivers, the major services outsourced, and the service provider landscape and segmentation; and discusses the trends in outsourcing over the next few years.

About ValueNotes
ValueNotes, based in India, is a leading provider of market intelligence and research, with expertise across industries. Our strengths lie in our analytical ability, industry expertise, and the research and data collection skills of our researchers and analysts. We have built strong capabilities in the collection, interpretation and analysis of data – including quantitative and qualitative research.

The ValueNotes Sourcing Practice is a dedicated team that actively tracks and researches the global outsourcing segment. The Practice has released several research reports on niche outsourcing areas, with a particular emphasis on the knowledge services domain. Our analysts work closely with leading IT-BPO companies and client organizations, both in India and globally through a variety of research based engagements. Our core research offerings include industry reports, as well as bespoke research services such as market/location assessments, partner/vendor selection, among others.

About HfS Research
HfS Research is the leading research analyst advisory firm covering global outsourcing and shared services strategies.

With 50,000 subscribers, HfS Research provides the most influential and frequently visited collaborative research network in the global services industry, providing rapid and insightful commentary, analysis and debate of enterprise outsourcing dynamics. The organization is unique because it integrates personable social networking with market research and advisory services.

The HfS Research mission is to provide a unique environment for collective research, opinion, experience and knowledge across the global outsourcing industry to help enterprises explore new performance thresholds. Led by industry expert Phil Fersht, the HfS Research team is a multi-disciplinary group of analysts across North America, Europe and Asia/Pacific regions.

HfS Research's in-depth analysis covers business process outsourcing, information technology outsourcing, cloud business services, shared services and governance strategies, in addition to industry trends across financial services, manufacturing, utilities, energy, healthcare, pharmaceutical retail and media sectors. The firm's service provider performance evaluations, pricing strategy assessments, market forecasts and sourcing best practices help multiple companies worldwide today.

Launched in 2007, HfS Research's acclaimed blog Horses for Sources has more than 120,000 monthly visitors across the global outsourcing industry, and is widely recognized as the leading destination for collective insight, research and open debate of industry issues and developments. The HfS LinkedIn community is thriving, with more than 12,000 industry professionals sharing views and information daily. More information about Horses for Sources can be accessed at www.hfsresearch.com. The company can be followed on Twitter at www.twitter.com/horses4sources and LinkedIn by joining The BPO and Offshoring Best Practices Forum.

For more information about HfS Research, please email research@HfSResearch.com.

For more information, please contact:
Nandita Harendra | Corporate Communications | T: +91 20 6623 1796 | E: nandita@valuenotes.co.in
ValueNotes - Corporate | Research & Consulting | Outsourcing Intelligence

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This release was published on openPR.