Oil and Gas industry is highly technical due to the diversity of personnel expertise and functions. It is therefore, important for any company within this industry to find an epicentre through which different departments interact on a real-time basis to ensure it stays on its course.
An Enterprise Resource (ERP) system software serves as this epicentre, not only to improve the efficiency of operations but ensure seamless data analysis from different organisational and departmental facets. This data is then used up by the relevant parties to make well informed decisions regarding the current and future operations of the business.
The discussion below portrays the various benefits of using an ERP system in a Gas and Oil company.
Localising the Financial Accounting Reporting
Most companies in the Oil and Gas sector interact both locally and internationally with partner organisation or its worldwide branches. Due to the vast service levels involved this yields to numerous currency exchange transactions. Given the different legal requirements by the relevant Audit, Legal and Tax Authorities in each Geographical area e.g. countries, states etc, an ERP system Financial Suite with the appropriate configurations in each locality allows for ease of consolidation of financial reports by the Parent company on a real-time time basis.
Cost Management Structure
Due to the numerous costs within an Oil and Gas business, ranging from procurement of assets, salaries etc., an ERP system simplifies all these costs by itemising each cost into its rightful component. This allows for departmental heads to effectively monitor, approve and disapprove any cost. This allows each department to stay within its allocated budget limit.
Asset Management
Oil and Gas companies consist of a wide range of assets both current and non-current. This range from machines, people, vehicles, stocks etc. An ERP offers specialised management functionalities to each of these assets in a unique and interactive way as described below so far.
The Stock Management Suite allows for departmental heads to know the stock levels at any given time, thus able to evaluate whether the current stock levels are at par with the current customer demand.
The Human Resources Suite also assists with managing employees. Human Resources team is able to know which employee missed work and whether they followed the right process,this way proper unbiased decision regarding a particular employee can be made on a real time basis.
The Fleet Management Suite can also help the logistics department to determine which vehicles are due for service, insurance etc., as well as which ones have completed their life-cycle and need to be disposed-off. It can also ensure tracking is done on a real-time basis, where the ERP can be integrated with a geo-locator module. Manually, such tasks would be daunting.
Conclusion
With its vast capabilities an ERP system is essential for any Oil and Gas Company as it provides for a total quality management. It also provides for a multilingual ability which ensures seamless communication among partners across the world. This ensures overall effective and efficient management of the business.