By Rocky Williams and Kevin Schroeder, Grant Thornton LLP

Information management: 4 key energy company pillars

When we work with our energy clients, the first thing we look at is a set of four interconnected pillars: portfolio management, cost management, margin management and capital management. These pillars collectively are the engine that drives efficiency, profitability and growth. Successful information management means working across these pillars and their points of intersection.

The Need For Actionable Insights

Energy companies often generate a high volume of quality data, but managers need more — they need a way to get actionable insights that reflect the interconnected nature of the business’s four pillars. Information management provides the insights that energy company managers need to run their businesses:

--Linking performance metrics with actual data, without complex manipulation and intervention

--Providing consistent platforms for data management across business units

--Offering flexibility in managing data, metrics and results

Making Tools Work

The four pillars must be served by the right systems and they all have to work together. Business complexity is directly related to the information management process, and any output must reflect the interconnectedness of the business. In order to have the best chance at success, it must be treated as an integrated process. Since once element might impact multiple processes, managing the process is even more critical.

Sophisticated information management starts with the systems that can generate the right data. These come in various forms, from Oracle to SAP and many other vendors. Energy companies are probably using a variety of vendors that were chosen at different times under different circumstances. Some work well, and some might need to be rethought. These systems are a starting point — it’s really how they work together that should be the focus for a world-class information management approach.

Among other things, your systems need to:

--Integrate volumetric and operational data with financial data

--Reduce/eliminate data reconciliation between systems

--Integrate financial-driven hierarchies with operational reporting

--Provide a data warehouse

--Establish risks and controls

--Enable data governance

--Include IFRS and GAAP reporting requirements

--Identify differences and uses of Enterprise Performance Management Architect (EPMA) with DRM

--Enable working capital and profitability analytics

Working With Energy Companies

Do you need advice on moving your information management process forward? Start with the following questions:

--Are we consistently supplying enough information?

--How are we dealing with third-party data (e.g., nonoperated data)?

--What is our bigger challenge: managing data or delivering information?

--Do we have access to sufficient details to make timely decisions?

--Strategy management: Are we in the weeds or are we looking at our overall, long-term strategy to drive the process?

Grant Thornton LLP’s professionals have extensive experience working with energy companies to improve their information management systems and processes. Let’s start a conversation.

Rocky Williams is managing director in Grant Thornton’s Technology Solutions practice and is based in Dallas. Contact him at rocky.williams@us.gt.com for more information.

Kevin Schroeder is national managing partner of Grant Thornton’s Energy practice and is based in Dallas. Contact him at kevin.schroeder@us.gt.com for more information.