The Integration Opportunity: Bringing Cloud-Based SAP Enterprise Resource Planning (ERP) to Oil and Gas Companies

Accenture and SAP experience shows that growing numbers of oil and gas companies are adopting “two tier” enterprise resource planning (ERP) strategies, retaining their existing core ERP systems while simultaneously realizing the benefits of cloud services to integrate their business information at a local and/or subsidiary level.

Despite being early adopters of emerging technologies such as high-performance computing, oil and gas companies have until recently remained wary of cloud applications. This is now starting to change, with increasing numbers of organisations seizing time- and cost-based advantages by using cloud-based enterprise resource planning (ERP) systems as part of their two-tier ERP system strategies. Adding the cloud into the ERP mix makes systems very flexible, allowing companies to adapt and change in a way that does not affect either efficiency or profitability.

Companies following two-tier ERP models can generally respond to changes – in their industry and their organization – in a way that is both fast and directly focused on their business needs. Consideration of this two-tier approach is common among oil and gas companies that struggle to push out their core ERP platform to smaller subsidiaries, joint venture partners and new acquisitions (particuarly in emerging markets).

For the many oil and gas companies already operating on-premise systems based on SAP ERP applications, the on-demand delivery model of SAP Business ByDesign helps to avoid the large initial capital outlays required for traditional licensing of on-premise software to their subsidiaries. Engineered by SAP for a rapid implementation, and tailored by Accenture to the needs of companies in the oil and gas sector, this cloud suite for ERP offers all the expected functionalities expected from a core ERP system via a web browser.

As more participants in the oil and gas sector value chain move to cloud computing, companies that continue to use homegrown, custom ERP systems will find themselves at a disadvantage compared to their cloud-enabled peers – in terms of cost, agility and operational effectiveness. Companies that move now to adopt SAP Business ByDesign have the opportunity to seize valuable competitive advantage in an increasingly challenging marketplace.

Joachim Stiehl, SAP AG

Carlos Aboujaoude, Accenture

Silke Lehmann, Accenture