Refiners are gaining financial benefits from digital technologies but are missing out on the additional value that the most cutting-edge technologies could provide, according to new Accenture research.
“The Intelligent Refinery,” Accenture’s second annual study on digital technology in the refining industry, is based on a survey of approximately 170 executives, functional leaders and engineers at refiners globally. In addition to addressing the financial benefits that digital technologies can provide, the research also suggests that refiners are not investing sufficiently to address the increasing number of cyberattacks resulting from the proliferation of digital technologies.
Forty-one per cent of respondents reported that their company can now determine the financial value of using digital technologies, including 30 per cent who reported that the technologies increased their refining margins by more than 7 per cent in the last 12 months. One-fifth (20 per cent) of respondents said digital technologies are adding US$50 million to US$100 million or more in value to their business, with another one-third (33 per cent) of respondents citing between US$5 and US$50 million.
This tangible financial benefit may explain why more than half (59 per cent) of companies surveyed — approximately the same proportion as in last year’s survey — are spending more or significantly more on digital technologies than they were 12 months ago.
Additionally, three-quarters (75 per cent) intend to increase spending in the next three to five years, up from just over 60 per cent in last year’s survey, indicating that demand for digital technologies remains strong.
Likewise, almost half (48 per cent) of refiners now rate the use of digital technologies within their company as mature or semi-mature (up from 44 per cent in last year’s survey). At the same time, however, most refineries have yet to move beyond deploying well-established digital technologies, such as analytics.
“Refiners are currently reaping just a fraction of the value that digital can yield,” said Intira Laomeepol, Managing Director, Resource Operating Group, Accenture in Thailand. “The next step will be to combine and deploy multiple technologies at scale to totally reinvent business processes and drive plant-wide transformational change. Our recent Accenture Disruptability Index pinpointed the energy industry as the most susceptible to future disruption. Increased and tactical digital investment can better enable the efficiency and performance improvements to help refiners weather the storm. There are signs refiners have realized this and are taking action to capture these benefits.”