By Velda Addison, Hart Energy

HOUSTON—When the topic of disruptors surfaces at an oil and gas breakfast event, thoughts of geopolitical tensions, unforeseen weather events or anything else that could send the stock market into a momentary frenzy come to mind.

But not diaper consumption—for babies and yes, adults— in North America.

Regina Mayor, principal at KPMG, cleverly used some stats from Koncept Analytics’ 2013 Global Diaper Market Report to point out a disruptor: people are getting older. The graph showed that consumption of baby diapers fell by 8% compared to the prior year, while consumption of adult incontinence products rose 22%.

Such disruptors put pressure on business and operating models, evoking change. But companies can make some predictions based on these disruptors, she said while speaking Dec. 3 at the KCA Houston Energy Breakfast.

“It’s predicted that by 2050 for every one individual that’s over the age of 65 there will be 3.5 individuals that are between 20 and 64 [worldwide],” she said. “The demographic is changing fundamentally, and we’ve got a very large aging population that will create lots of challenges around the business model.”

Enter millennials. These are the youngsters born between 1980 and 2000. These are the ones who have collectively racked up about $1.1 trillion in student loan debt. Some of them live at home with their parents. Some don’t care much about owning a car or other tangibles, instead placing more value on experiences—like traveling or going to a concert.

Why should the oil and gas industry care?

“Millennials are now the largest population cohort in the U.S. and are projected to comprise 50% of the workforce by 2020,” Mayor said in her presentation.

They typically expect instant digital access and they expect change, she said. Plus, for the most part, they are technically savvy, considering they are the first generation of digital natives. This can be an advantage for companies, especially given that technology is another major disruptor that is impacting how people operate today. Think about iPhones and the potential for Google Glass.

“If we take advantage of it as an industry, it can be quite positive. With augmented reality, the way we train can be completely different,” Mayor said. “It could be real-time. Think of the Google Glass concept, if you’re out in the field looking at a piece of equipment you can instantly pull up the entire case history of that piece of equipment, what that manufacturer’s standards are, what kind of specifications it requires.”

It also has potential when it comes to remote monitoring, she pointed out, noting it may not be necessary for everyone to work in dangerous and risky places.

Bringing people and technology together creates opportunities to grow economically and reduce risks. Just like machine-to-machine connectivity with the “smart home,” which helps consumers better manage electricity consumption, equipment in the oil patch can be programmed to communicate with each other. This creates the potential for what Mayor called self-healing transmission networks and self-diagnosing equipment.

“All of that is very much within our reach,” she added. “I predict that every major sub-segment of this industry is going to radically change in the next 10 to 15 years.”

For the upstream and oilfield services sector, this could translate into improved efficiency and lower costs—something of which the industry can never have too much.

Velda Addison can be reached at