Energy Companies' Digital Investment Trends and Workforce Skills
Energy Companies and the Digital Shift
In the rapidly changing landscape of the energy sector, a remarkable 92% of energy companies are gearing up to invest in digital technologies. However, a surprising 27% have taken proactive steps to retrain and reskill their existing employees to meet this impending demand.
The Need for Reskilling in Energy Sector
Reskilling's Importance Yet Limited Action
Significant insight comes from the findings of energy sector executives. A staggering 91% of power and utilities leaders and 85% of executives in oil, gas, and chemicals concur that their organization's ability to reskill will be pivotal for future success. Conversely, a meager 26% of the former and 29% of the latter acknowledge that their companies are currently focusing on retraining existing staff. This disparity highlights the gap between recognizing the importance of reskilling and taking action to implement it.
Gaps in Workforce Development Strategies
To mitigate the skills gap, many companies are anticipated to rely on external resources. An impressive 88% of executives from power and utilities and 81% from oil and gas sectors plan to increasingly depend on vendors and contractors for various operations. This trend illustrates a shift in strategy as organizations seek to bridge the skills gap while optimizing their workforce.
Growing Agility within the Energy Workforce
In the face of evolving business demands, the agility of the energy workforce is noteworthy. A significant majority, 86% of executives in power and utilities and 81% in oil and gas, assert that their workforce is sufficiently agile to adapt to changing market needs. This represents a substantial leap in confidence compared to previous years' surveys revealing only 57% and 53%, respectively.
Challenges in Technology Adoption
The Importance of Technology Adoption
With digital technology adoption anticipated to have an extensive impact in the next five years, oil and gas and chemical firms are ramping up investments. Moreover, those indicating considerable planned investment in digital technologies have risen by 20 points since the last assessment, now reaching 49%. Additionally, 42% express a commitment to invest a moderate amount.
Executive Sentiment on Digital Advances
Despite the optimism towards technology, executives are facing hurdles. Few believe that their investments in technologies such as artificial intelligence and cloud computing have yielded the expected return thus far. Yet, there’s a strong desire for these technologies to realize their potential.
Future Strategies for Energy Companies
Executives express a collective aspiration to maximize stability while implementing risk mitigation strategies through known technologies. However, the adaptation of emerging technologies demands a level of flexibility and a willingness to embrace risk that can be challenging within historical frameworks of stability.
Incorporating Continuous Learning
One vital strategy discussed by leaders like Timothy Haskell, EY’s Americas People Consulting Leader for Power & Utilities, is the integration of continuous learning into everyday operations. The fulfillment of organizational needs for skilled talent relies heavily on shortening the skills gap while embracing reskilling, outsourcing, and utilizing innovative hiring practices.
Conclusion: Leading Through Change
The energy sector stands at a pivotal crossroads. As digitization accelerates, companies must find a balance between leveraging existing workforce talent and embracing external resources. Each organization must tailor its approach to cultivating talent and ensuring that technology investments align with their strategic goals. With collective efforts to foster adaptability within the workforce, the future of the energy sector looks promising.
Frequently Asked Questions
Why are energy companies not prioritizing employee reskilling?
Despite recognizing its importance, many energy firms face constraints and operational challenges that hinder effective reskilling initiatives.
What percentage of energy executives believe reskilling is crucial?
Around 91% of power and utilities executives and 85% of oil and gas executives believe their ability to reskill is vital for success.
What are the predicted impacts of technology on the energy market?
Executives predict adoption of new technology, advances in renewables, and shifts in consumption will greatly influence the market.
How agile is the workforce in the energy sector?
Most executives, 86% from power and utilities and 81% from oil and gas, deem their workforce agile enough to respond to changing demands.
What challenges do energy companies face with technology investments?
Many executives report difficulties in achieving expected returns on technology investments, indicating a gap between technology implementation and realized benefits.
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