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Wood and IBM partnership targets digital opportunities

11th May 2018

Wood and IBM have entered into an agreement to conceive and offer compelling new digital products and services that will advance operational efficiencies for customers in industrial and energy markets.

Partnership targets digital opportunities
Partnership targets digital opportunities

This multi-year strategic collaboration combines Wood’s engineering innovation and industry expertise with IBM’s advanced market leading technologies in areas such as artificial intelligence, blockchain and analytics to create a leading client service proposition.

In July 2016, Wood’s Digital Solutions service line was formed to consolidate the IP rich, software solutions businesses across the company. The vision was to be Wood’s externally focused provider of commercial software and operational technology (OT) services. “The combined capabilities of our digital business strongly underpins the Wood engineering business, providing the digital support, information and data management skills needed to equip the business to offer differentiated, digitalised services to our traditional and new customers,” Kieran Kavanagh, vice president digital solutions at Wood, said. “Adaptation of new technologies and smart, streamlined thinking is vital and Wood is expanding its technology portfolio with our automation and control and digital solutions teams leading the way in innovation and enhancing the way we work, making innovation a part of our culture.”

Kavanagh added that both Wood and IBM are at an inflection point during an era of digitisation and the emergence of new technologies: Wood following the acquisition of AMEC Foster Wheeler, and IBM embracing its new identity as a cloud, cognitive and digital reinvention company.

“This provides an opportunity for both companies to explore and build new opportunities. We've seen many of our clients concerned with the risk of disruption - we will serve them better with a coordinated end-to-end service that will provide our customers with differentiating business value.”

Cost cutting measures can only boost efficiency so much for an industry that is already lean and mean following the past several years of a downturn. Digital technologies have the potential to transform operations and create additional profits from existing capacity.  Research by McKinsey & Co. has found that the effective use of digital technologies in the oil and gas sector could reduce capital expenditures by up to 20 per cent. These technologies also could cut operating costs in upstream by three to five per cent, and by about half that in downstream. 

“Through this strategic agreement, Wood and IBM will provide solutions that maximise value in the development, operation and integration of systems and assets,” Colin Smith, director business development digital solutions, Wood said. “This includes developing solutions and exploring new ways to apply artificial intelligence and advanced platforms to improve productivity and expand Digital insights.”

The initial phase of the collaboration will focus on the oil production and utilities sectors in three key areas where IBM and Wood believe they can bring immediate value to clients.

Capital project design & planning – combining digital processes and data management tools to provide predictable costs and seamless integration from design to commissioning. 

Asset insights – providing leading edge analytics platforms to provide insight to asset owners and operators looking to improve operational efficiency, predict operational or safety issues and drive down costs associated with production phase assets

Project execution excellence – the use of blockchain and cognitive capabilities to ensure effective and safe execution of the work scope through advanced control of work solutions that manage worksites, personnel, materials and equipment in accordance with the project plan.

“An example may be materials management and stores control where Wood will be responsible for physical items control and IBM will provide the IT back-up system,” Smith explained. “By bringing together our capabilities with IBM’s, we are able to provide clients with a more accurate and streamlined services across the globe. This will generate savings by minimising inventory and ensuring that stocks are held at the right place and available just in time.”  

Across asset intensive industries, the next industrial revolution is being led by digital technologies that are challenging existing business models and changing the way assets are designed, developed, deployed, operated and maintained. “Together, Wood and IBM will look to explore new ways to apply blockchain, analytics and cognitive technologies to improve productivity and expand digital insights to drive greater value for our clients,” John Sullivan, executive partner, industrial sector leader, IBM Global Business Services UK, said. “We specifically see benefits in developing scalable technology platforms that can provide standard capabilities to solve common industry challenges.  An example relates to condition-based monitoring, leveraging a range of different data sources to be able to accurately predict failures and prescribe preventative measures to maintain uptime.”  

The initial phase of the collaboration will focus on oil producers and utilities and will ultimately expand to a broad spectrum of industries – including those where Wood and IBM are deeply engaged, such as process industries, automotive, nuclear, clean energy and mining.

You can listen to Kieran Kavanagh, Wood, and Luq Niazi, IBM at the upcoming Future Oil & Gas conference, Aberdeen, 12-13 June.

View the conference programme here