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What energy leaders get right


July 17, 2023

In an increasingly fast-paced world, a new reinvention strategy is poised to change the competitive game across all industries. We call this strategy, centered around a digital core and new ways of working, “Total Enterprise Reinvention.”1 Several characteristics distinguish this new form of reinvention, including its continuous and boundaryless nature, its reliance on technology and talent, and its ability to accelerate a step change in performance.

This type of enterprise-wide reinvention is important in the oil and gas industry, too. Our recent research found that 92% of energy companies are pursuing significant, fundamental or even “radical” transformations. Nearly two-thirds of them (62%) view enterprise-wide transformation as a critical strategy to help them achieve incremental returns through cycles.

A new performance frontier

In our analysis of 200+ energy companies, we identified 21 that are leading the reinvention race. They are taking decisive, holistic actions to bolster multiple capabilities across five distinct areas: Competitiveness, Carbon, Connectivity, Customer and Culture. Here is what they are doing differently—and arguably better—in these areas:

  • Competitiveness. Competition is critical in the oil and gas industry. Oil and gas supply disruptions following Russia’s invasion of Ukraine has made energy security a global issue. Energy security in the near-term depends on maintaining oil and gas production. However, balancing near-term energy security and longer-term energy sustainability will be key to their ability to compete and deliver 360° Value.

    Leaders are taking a holistic approach, realigning their portfolios to balance energy security and sustainability, with a focus on both hydrocarbon and non-hydrocarbon assets. By doing so, they are better primed to weather challenges and maintain a focus on reinvention with an eye toward the future. 
  • Carbon. Leaders in the oil and gas industry are demonstrating their ongoing commitment to net zero. Emissions reduction is a key priority for them, and 92% are setting net-zero targets. They also understand that the future energy system will require a more balanced portfolio that includes multiple low-carbon solutions. The best performing companies also have the highest hopes for these investments paying off, with 20% expecting their low-carbon initiatives to produce revenue growth of more than 10% over the next three years.

    Their expectations extend beyond revenue, however. Our research has found that energy companies that pay greater attention to environment, social and governmental (ESG) metrics enjoy lower cost of capital, better stock performance and less volatile share prices. While it’s too early to attribute causation, a correlation is emerging between ESG performance and financial performance.
  • Connectivity. Leading energy companies are placing a greater emphasis on a strong digital core that enables connectivity. Indeed, 94% of leaders’ remote operations are already highly connected and monitored in real time, and 89% said their functions and operations are also connected—a far higher percentage than their lower-performing industry peers.

    Importantly, leaders are significantly more confident in their connectivity and data management capabilities, more concerned about cybersecurity, and more optimistic that their digital transformations will drive value in everything from carbon emissions to customer and employee satisfaction. Yet, even leaders are vulnerable.

    We found a notable percentage of even leading companies have capability gaps that will possibly hinder their abilities to integrate their digital solutions, accelerate innovation, or capture optimal value from connected operations. Most tellingly, 30% of leaders have not yet transitioned most of their workloads to the cloud. 
  • Customers. The homogenous energy system, based on oil and gas, is becoming much more heterogeneous, with new energy choices for consumers. As energy companies continue their reinvention journeys, they must rethink customer-centricity and engagement strategies. While leaders are more likely to see the need for business and individual consumers to be able to procure and consume different sources of energy in ways that meet their unique needs, they aren’t yet doing enough in this area.

    For example, few companies are prioritizing the development of ecosystems or partnerships that promote energy efficiency and sustainability. However, these ecosystem partnerships will grow increasingly important as customers expand their demand beyond fuel to new areas such as power, energy efficiency services or carbon offsets. 
  • Culture. Successful reinvention in the energy industry will be powered by skilled and enthusiastic employees. Yet, energy companies continue to struggle with recruiting and retaining talent. This has little to do with pay. Additional Accenture research found that nearly two-thirds of energy employees do not believe their companies care for them.

    More than 40% feel they can’t bring their authentic selves to the workplace.2 Leaders understanding that fixing these culture issues starts at the top; 94% of them place ownership of culture at the feet of the CEO or board members. 

Balance makes perfect

Perhaps even more important than the actions they take and the ambitions they hold is the approach that leading energy companies are taking to reinvention. Our research shows they are adopting a more balanced, holistic approach to their reinventions. This is critical. And in this regard, they are moving in the right direction. Specifically, they are moving toward the total enterprise reinvention that will characterize winning companies in the decade ahead.

Special thanks to Lasse Kari.

Disclaimer: The views and opinions expressed in this document are meant to stimulate thought and discussion. As each business has unique requirements and objectives, these ideas should not be viewed as professional advice with respect to the business. This document may contain descriptive references to trademarks that may be owned by others. The use of such trademarks herein is not an assertion of ownership of such trademarks by Accenture and is not intended to represent or imply the existence of an association between Accenture and the lawful owners of such trademarks.


Aleek Datta

Managing Director – Strategy & Consulting, Energy