"You can't teach an old dog new tricks" conjures up a blue tick hound sprawled on the front porch of a rustic farm house on a lazy summer day. While everyone loves that old cuss, most likely he really can't be taught anything whatsoever besides eating from a new food bowl. Same old hound year after year.
But oil industry managers are light years smarter, more business savvy and adaptable to new ideas than that snoozing hound. They didn't cling to mainframe punch cards when desktops became the way to do business. And they didn't insist that phones had to have cords when cell phones became the way to reach anyone anywhere. Most importantly, the real oilpatch decision-makers don't grab the shotgun off the old dog's porch and shoot down ideas that actually work better than worn out ones.

That's why the glitzy "digital oilfield" (DOF) is about much more than changing how the industry works technologically; it's about how the very process of business innovation works. It's about putting more productive business innovation models into play for better results more often.
Wishful thinking

Traditionally, innovation at companies has followed the "wishful thinking" approach - take creative people, leave them alone in a detached campus environment and they will come up with magical innovations. That's Model A in the models of business innovation. Although that has worked for inventors whose product innovations became industry standards, in the broad sweep of revolutionary business innovations it has been a flop.

In contrast, take the same creative people, give them precise needs, hold their noses to the grindstone, and real innovation more likely will occur. That's Model B. And this approach bears directly on the business-oriented path that the DOF will take. With the oilfield environment continually demanding lower costs, the question becomes: "With the DOF exploding around us, are we going to be a player? If so, are we going to rely on 'magical thinking' or try to manage the direction of business innovation?"

Or, stated another way, in the oilfield's future, numerous innovation areas appear to have fruitful potential. Therefore, the choice for companies is twofold. Do they essentially let nature take its course, letting people be individually innovative and having conversations with an endless stream of DOF vendors while hoping that something, somehow emerges from all this? Or will executives recognize the value of delivering innovation through a more structured program with clear business targets?

Model B is something that virtually everyone in business is familiar with: a direct problem-solving scenario. For example, an executive typically calls the IT expert into his office and says, "Here's my problem. Figure out how to solve it within a certain number of days." Subsequently, the problem-solver returns and announces, "Here's the solution to the problem you described."

But - and here's where the typically unproductive business/IT relationship can take a turn for the better - there is another level of innovation. In addition to the IT expert doing most or all the listening, roles are reversed, with the business executive essentially saying "Tell me about what is happening in IT today." In turn, the IT expert says, "Here are all the amazing things happening technologically. Here's where IT is headed." To which the business executive hypothetically replies, "I didn't realize that all those things were possible. Now that I know, here are my re-stated business problems. In this new context, how can you solve it?"

A major oil company is very involved in maximizing that approach through a business-oriented forum between executives and the IT department, adding a unique spin. One quarter, the business executives speak and IT listens, then IT later returns with solutions to specific business problems enumerated. Next quarter, however, when the same group meets, IT representatives become the "talkers." Then, as noted above, the business executives come forward with a new set of questions not formulated in a vacuum but based on what they understand that IT can technologically do for their business.

That cycle becomes an innovation engine for the DOF in getting both business and IT on the same page.
In and out of the box

As more companies jump on the trendy "out-of-the-box thinking" bandwagon, it's important to remember that thinking "inside the box" can be just as valuable. So, take a page from blue-chip companies that thrive by combining both kinds of "box thinking," using key rules of thumb.

One, stay in the vicinity of out-of-the-box thinkers whose enriched thinking may add value to the business. Two, find ways to cope with these people who are typically strung differently than the norm within the company. In other words, figure out how to put up with the possibly eccentric baggage lugged around by out-of-the-box thinkers.

Three, since out-of-the-box thinkers are not mainstream employees, get their ideas translated so that others within the company can actually use their ideas. That may require pairing "natural translators" with the out-of-the-box thinkers to bring to life the actual value in what these left-field people are saying.
Four, the "out-of-the-box" expression is not confined to the four walls of a company. Instead, think about breaking out of the industry box, not just the company box. Explore what people in other industries are doing in their own out-of-the-box thinking.

Five, leverage everyone potentially having fresh, innovative thinking within the company, instead of pigeonholing only a select few as the innovative thinkers. One of the biggest problems in innovation is that not enough people have been encouraged to do hard, logical and/or focused thinking about the business.

Finally, don't expect the best thinking to come from those who haven't been around the block a few times. Again and again, the best thinking comes from those who have worked in the box, explored all its dimensions and even experienced its pitfalls, then have broken out with some leading-edge ideas. The bottom line is that when a company needs an extra shot of adrenalin on the idea front, "Go think."

Innovation drivers

To make productive innovation happen, clear business targets are critical.

Certainly, having all kinds of diverse thinkers, innovation techniques and an open, creative environment are all good. But success dictates that certain "must haves" are necessary, and clear business targets are at the top of the list. That translates into companies having bright people soaked in a nutrient solution of information in pursuit of concrete targets.

Underscoring the second point relative to DOF: companies must restore the basic conversation between business people and providers who are supposed to help them solve problems. In many companies, unfortunately, that means a fundamental repair of the relationships between IT and the company's business side. And, an especially critical point, these companies may have to add special people who can straddle the divide between business and IT. These are people with the unique ability to understand and explain business as well as IT issues.

If companies do not have integrated thinking and cannot have reasonable conversations to develop business solutions from IT, then the DOF will remain "neat stuff in the lab" or a DOF playground. On the other hand, when users and their internal IT vendors can successfully converse in plan "business English" instead of IT acronyms, when IT talks about what is possible in terms of business solutions, then the DOF becomes considerably more real.

Bright lights of innovation

Technological advances have brought more dynamic changes to the oil industry then even an over-optimistic futurist could have imagined. Bringing more sea changes is the DOF which, without an ounce of hype, will change the industry again and again. Yet some models for business innovation work better than others. With clear business targets and a structured program, innovation can deliver more fully on its promise than all the wishful thinking combined.