Insights

Displacers and Augmenters

March 22, 2022
Zack Warren

Buying enterprise O&G software kind of sucks.

There are an enormous number of vendors, a bewildering array of features and capabilities, and a horde of internal stakeholders you’ll need to convince if you want them to adopt something new. One framework I’ve found useful is to distinguish Displacers from Augmenters.

Displacers come to market attempting to convince you to drop that Old Busted tool and pick up the New Hotness. They start the presentation with a simple pitch:

“Aren’t you tired of that lousy Software X?  It’s old, slow, ugly, and dumb.  We’re new!  And fast!  And handsome and smart!  Buy our tool, you’ll go home earlier, drill better wells, and save boatloads of cash!  Plus, grow back your hair!”

Augmenters make a different pitch – they are trying to convince you to solve a problem you’ve never solved before. Maybe even a problem you didn’t know you had. Their message has mystique, and they definitely wear black turtlenecks a la Steve Jobs (or Elizabeth Holmes?).

“You’ve never seen anything like this before.  We’re so innovative, we only hint at what we actually do.  You won’t believe it until you see it, and even then, you won’t believe it.  This. Changes. Everything.”

Joking aside, let’s talk about some examples.

We often use the idea of Technology “Slots” at an E&P company to help our clients understand their current tech stack.

  • The Big Six is our framework for the handful of truly central pieces of tech that all E&P operating companies (should) have – ERP, Reserves/Planning, Production Allocation, Well Lifecycle, Land, and SCADA.
  • Furthermore, we think of The Dirty Dozen as the satellites that hover around the Big Six – usually discipline-specific tools like Geoscience Interpretation, Electronic Invoicing, Computerized Maintenance Management System (CMMS), or AFE Management. These are incredibly important tools in the E&P toolbox – properly implemented, they can drive down costs, target better reservoirs, and even help keep our people safe.
Some examples of Displacers trying to push an incumbent out of a “Slot” (in alphabetical order, no favorites here!):
  • ComboCurve is trying to displace ARIES and PHDWin, the dominant incumbents for Reserves/Planning
  • Iron-IQ is trying to displace legacy SCADA systems like CygNet, SCADAVantage, and WonderWare
  • W Energy is trying to displace legacy ERPs and Land systems like Bolo, OGsql, and Wolfepak
And here are some Augmenters that have broken into O&G (chronologically this time, again, no favorites here!):
  • Electronic Drilling Recorders like Pason and TOTCO were brand new in the 1990s. The idea of taking continuous readings off a rig was revolutionary and gave a degree of insight that drilling engineers loved (and more than a few company men probably hated).
  • Spotfire broke out as the first democratized Business Intelligence tool to be used in O&G in the late 2000’s. While SAS and Crystal Reports were much older, Spotfire’s GUI-first Excel-on-steroids swept across the E&P landscape like wildfire, especially in disciplines like Petroleum Engineering and Geoscience.
  • A newer example is Electronic Ticketing systems like ENGAGE or OpenTicket. These combine geofencing, remote data capture, SCADA integration, and approval workflows to give visibility into vendor activity that is fundamentally new. We talk about these in our Supply Chain series, but their usage has exploded in the last few years.

Whether you’re on the Buy or Sell side of this market, it’s useful to be clear about whether you are Displacing or Augmenting. The value propositions are fundamentally different, as are the risk/reward tradeoffs for the purchaser.

  • Displacing requires a really smooth transition with well-oiled data migrations, go-live schedules, and user re-training. Pilots are hard – these tend to be all-or-nothing rollouts. And success tends to be binary – it either worked, or it didn’t.
  • Augmenting requires more discovery, process mapping, and feeling your way forward in the dark. Pilots are common, to the point of “death by pilot”. Success metrics are vague and hard to pin down, especially as scope creep is endemic.

The worst possible place to be is to try to both Displace and Augment at the same time. Strict success criteria *plus* scope creep?! Tons of business process mapping *plus* migrating 150 data tables from Old Busted over to New Hotness?! Doing both at once is hard to sell and even harder to succeed at.

What has your experience been? Where do you see the highest ROIs? Drop us a line, we love to talk about this stuff…

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