WCIT 2008: CIO Perspectives - Energy Industry

More about WCIT 2008
This is one of the sequel to the CIO Perspectives talk held earlier at Plenery Hall L1.

This is really a lot of fun, interesting and probably because the hall is smaller.

Here are the issues, points and insights....

First of all, the energy(Oil and Gas) industry is much more less ICT dependent comparing to the financial industry such as bank, insurance and etc.

Nevertheless, the O & G industry is much more bigger and has more money to spend. For BP itself, it is estimated to spend billions of dollars.

The fact that O & G industry has many types of businesses such as upstream and downstream makes it even more challenging.

O & G industry used to be very innovative and it is claimed to have invented the corporate email system and today things have changed. As we know it now, it is all about delivery smooth operation. However, the things which they are doing in the upstream business can be quite innovative.

The paradigm for ICT implementation in the O & G industry is Globally Integrated Enterprise as coined by IBM. The idea is to approach problems in a holistic manner, as such the whole architecture can be summarized into three main layers.
  1. General Infrastructure - Emails, Fax, Phone, and etc
  2. Enterprise Applications - These will be implemented globally
  3. Assets Specific Applications - Country-specific applications(Unique to certain countries i.e MyKad)

So, these are the things which the 8,000 people in SiTi (Shell IT Malaysia) are doing daily. Just these three things.

The challenges that CIOs are experiencing:
  1. Country's policies - i.e in Nigeria, you can't move any data out
  2. The language
  3. Have to implement things pretty fast, this is also why outsourcing is almost 80% of the business. There is no time for having people to do trial and error in the organization. (If you have the Intellectual Properties and best practices, you have the edge)
Therefore, not everything can be outsourced to anybody, the local guys will still get some jobs from the big boys like Shell, BP and etc. And even Petronas is not doing much outsourcing. However, IBM believes that everything can be outsourced except for the following three activities:
  1. Marketing
  2. R & D
  3. Corporate Management
True enough, outsourcing are heavily engaged here are some of the criteria for choosing vendors:
  1. Delivery Capability - Can you implement your solution to 140 countries ?
  2. Are you offering western prices to eastern market ?
And a few things to keep in mind while doing outsourcing ..
  1. System Architecture should not be outsourced
  2. Knowledge must be retained
Trends and Opportunities Highlighted:
  1. High Performance Computing
    • 3D and 4D analysis of seismic data
    • Virtual reality approach for modeling and simulation
  2. Bandwidth Issues - O & G companies actually went at great length to build telecommunication infrastructures within countries which don't have existing infrastructure. And they don't mind investing money on it.
  3. Enterprise application is always about consolidation

The most mission critical system in Shell is email. And spam is the biggest problem which it is claimed to have received 5 million spam emails per day. So, if you think you got a better solution, you can always approach them.


David Crane - Award-winning Canadian Writer

David Crane is an award-winning Canadian writer on economic, political and environmental issues. His weekly column, Global Issues, appears in a number of publications across Canada. He is a member of the National Statistics Council, an advisory body to Statistics Canada, the President’s International Advisory Council at the University of Toronto, the advisory board of the Canada-U.S. Law Institute, and the board of the North American Institute. He is a participant in the BRICSAM project of the Centre for Innovation in International Governance, which is examining the role and impact of the emerging new economic powers (Brazil, Russia, India, China, South Africa and Mexico) on the global economy and global governance.

He also served as a board member of the University of Toronto’s Innovations Foundation, a member of the Ontario Science and Technology Council, a member of the steering committee of the Toronto Vital Signs Project, and as a member of the Challenge Dialogue of the Alberta Energy Research Institute. David Crane also served for five years as a judge for the Entrepreneur of the Year Award. He is a graduate of the University of Toronto. David Crane has an Arbor Award from the University of Toronto for his contributions to the university, honourary doctorates from Wilfrid Laurier University and Victoria University (part of the University of Toronto), and an award of recognition from Conestoga College He was awarded the Queen’s Jubilee Medal for his contribution to Canadian life. He was also awarded a Social Work Doctoral Award by the Social Work Doctors’ Colloquium. He is also a member of the Davos Circle, an association of long-term participants in the World Economic Forum. He has written several books, including The Next Canadian Century, The Canadian Dictionary of Business and Economics, and Controlling Interest.

He has also been a contributor to a number of other books. He is currently writing a book on innovation policy for the Organization for Economic Cooperation and Development.

The Panels are:

1. David Beaney - Chairman, Beaney Enterprises

David runs a specialist IT and outsourcing consultancy, Beaney Enterprises, having retired from BP in mid 2005.

The focus of Beaney Enterprises is to provide access to the experience that comes from having worked in senior leadership positions in one of the world’s largest company’s. David’s main interest is outsourcing from a client perspective - both the initial outsourcing transaction and more importantly the subsequent contract management challenges that are critical to success.

David started working for BP in 1977 and held a variety of commercial roles before becoming the global head of planning and strategy for BP’s refining and marketing businesses in 1991. In 1993 David moved into IT management as the Head of Information Systems (CIO) for BP’s refining and marketing businesses globally and became a member of BP’s Group Leadership. In this and subsequent IT management roles David led, managed and renegotiated many of BP’s largest IT outsourcing deals and became a leading member of BP’s Outsourcing Network providing internal advice on outsourcing across all support services in BP (accountancy, HR etc). David’s final role before retiring from BP was Director, Commercial Services responsible for all BP’s IT negotiations and contracts – a portfolio of $1.2billion of 3rd party spend. Outside work David is a keen sailor, skiier and golfer. David is married with two children.

2. Steve Clearwater - Executive Director & Global Desktop Services Director, Shell IT International

Steve, a graduate in Physics/Mathematics from the University of Auckland in New Zealand, joined Shell in 1974. He has held numerous positions in Information Technology in Shell, initially in NZ, and thereafter in Australia, London, Netherlands and Singapore, including IT Manager of Shell BP Todd Oil Services, Information Systems Manager in Shell Coal Australia, the Shell Australia IT Manager, Regional Manager - Infrastructure Services Asia Pacific Middle East, and Oil Products IT Business Manager in the East Zone.

Steve relocated to Kuala Lumpur in 2003 to assume the role of Shell’s Global Desktop Services Manager and Executive Director/Country Manager Shell IT International – Malaysia where he has overseen the development the largest IT delivery centre in Shell – here in Cyberjaya which encompasses both Infrastructure (Desktop, Hosting, Help Desk, Support services, Networking) and Application support services

3. Petronas Executive

4. IBM Executive

Other Talks on Day 2:
  1. Pikom to setup community PC Centers
  2. Technology is secondary, says QubeConnect
  3. Saladin to ride in next year
  4. Animating a home-grown industry
  5. The IMPACT is out