System Integrators: Are They Really Working for You?

Maybe.

Consider a large independent that recently decided on a multi-million dollar ERP implementation, only to find themselves years later with a system that couldn't accurately reconcile inventory across their multi-basin operations. Or the public M&A-fueled giant whose digital transformation project stalled, leaving critical data trapped in legacy silos, despite significant investment in a new integration platform. Then there's a mid-sized exploration company that, after a merger, attempted to consolidate disparate financial systems, resulting in months of delayed reporting and a significant hit to investor confidence.

These aren't isolated incidents; they're common anecdotes of seamless integration promises conflicting with the harsh reality of conflicting interests and poor accountability.

What's happening? Often, the problem isn't the technology itself, but the fundamental relationship with the system integrator (SI). In an industry where precision, reliability, and accountability are paramount, the approach to system integration often falls short of these very standards. It's time to ask the hard questions: Are your system integrators truly working for you, or are they just working for themselves?

The Uncomfortable Truth: SI ≠ Just a Vendor

The truth is, a good system integrator isn't just a vendor; they're a partner, and a true partner tells you the uncomfortable truths, not just what you want to hear. This means being upfront about risks, challenges, and the real effort required. It means planning thoroughly and executing meticulously, just as you would expect from any critical service provider in the oil and gas field. You wouldn't tell Halliburton to just drill a well without a detailed plan and strict oversight; why would you treat a multi-million dollar system integration any differently?

Upstream operators are not strangers to volatility. But periods of low commodity prices and intense M&A activity create immense pressure on companies to cut costs and integrate quickly. This often leads to rushed decisions in system integration, prioritizing speed and low bids over thorough planning and long-term viability.

The result?

Chaos, technical debt, and projects that fail to deliver on their promises. For example, a KPMG study revealed that 70% of M&A deals fail to create value for the acquiring company, with integration challenges a primary factor. In such an environment, the temptation to opt for the cheapest or fastest solution can be overwhelming, but it's a false economy that almost always leads to greater costs down the line.

The Path to Demanding More from Your Integrators

To ensure your system integrators are truly working for you, it's essential to establish clear expectations and enforce rigorous standards. This means:

1. Insist on Thorough Planning and Execution

Just as you wouldn't drill a well without a meticulously planned drilling program, system integration projects demand the same level of detail. Any integrator who glosses over these steps is a red flag. As Benjamin Franklin wisely stated, "By failing to prepare, you are preparing to fail."

Action Items:

• Joint Planning Workshops: Don't let the SI plan in a vacuum. Conduct intensive, multi-day workshops with key stakeholders from all affected departments (operations, finance, IT, supply chain, etc.) and the SI team. The goal is to co-create detailed requirements, process flows, and data models. This ensures mutual understanding and buy-in.
• Detailed Scope Definition: Move beyond high-level statements. Define the project scope with extreme granularity, including specific functionalities, data points, integration points, and performance metrics. Use tools like Use Case diagrams, User Stories, and Data Flow Diagrams to leave no room for ambiguity.
• Phased Approach with Clear Milestones: Break down large, complex integrations into smaller, manageable phases. Each phase should have clearly defined deliverables, acceptance criteria, and a go/no-go decision point. This allows for early course correction and reduces overall risk.
• Rigorous Testing Protocols: Demand comprehensive testing plans that go beyond basic unit and integration testing. Include user acceptance testing (UAT) with real business users, performance testing under peak load conditions, and disaster recovery testing. Ensure test data is representative of real-world scenarios, including edge cases and historical data.
• Post-Implementation Support Plan: A successful integration doesn't end at go-live. Insist on a detailed plan for ongoing support, maintenance, and continuous improvement. This should include service level agreements (SLAs), clear escalation paths, and knowledge transfer to your internal teams.

2. Establish Clear Metrics for Success and Accountability

Define what success looks like before the project begins, and tie your integrator's performance directly to those metrics. This goes beyond just technical completion; it includes operational efficiency gains, data quality improvements, and user adoption rates. Regular, transparent reporting against these metrics will ensure both parties are aligned and accountable. Don't just give them a job and let them go; actively manage their performance and hold them to the agreed-upon standards.

Action Items:

• Define Key Performance Indicators: Work with the SI to establish measurable KPIs directly linked to your business objectives. Examples include: reduction in manual data entry errors, time saved in reporting cycles, improved data accuracy rates (e.g., 99.5% data consistency), faster access to critical operational data (e.g., real-time well production data availability), or reduction in operational downtime due to system issues.
• Regular Performance Reviews: Implement a structured review process where the SI's performance is measured against the agreed-upon KPIs. These reviews should be frequent (e.g., weekly or bi-weekly) and involve key stakeholders from both your team and the SI's leadership.
• Incentivize Performance: Consider structuring contracts with performance-based incentives or penalties. Tying a portion of the SI's payment to the achievement of specific, measurable business outcomes can significantly align their interests with yours.
• Independent Verification: For critical projects, consider engaging an independent third party to validate the SI's progress and the quality of deliverables. This provides an unbiased assessment and adds another layer of accountability.

3. Foster a Culture of Truth and Transparency

Encourage your integrators to be honest about challenges and risks, even if it's uncomfortable. Create an environment where problems are surfaced early, rather than hidden until they become critical. This requires trust, but also a willingness on your part to address issues constructively rather than punitively. A truly effective partnership thrives on open communication and a shared commitment to overcoming obstacles.

Action Items:

• Open Communication Channels: Establish clear and accessible communication channels. Encourage daily stand-ups, regular steering committee meetings, and dedicated problem-solving sessions. Ensure all stakeholders feel comfortable raising concerns without fear of reprisal.
• Risk and Issue Log: Maintain a shared, transparent risk and issue log that is reviewed regularly by both your team and the SI. Every identified risk or issue, no matter how small, should be documented, assigned an owner, and have a clear mitigation or resolution plan.
• "No Blame" Post-Mortems: When issues arise, focus on understanding the root cause and finding solutions, rather than assigning blame. Conduct post-mortems for both successes and failures to learn and improve processes for future projects. This fosters a culture of continuous learning and trust.
• Regular Stakeholder Alignment: Beyond project team meetings, schedule regular updates with executive sponsors and key business leaders. These sessions should focus on strategic alignment, potential roadblocks, and overall project health, ensuring that leadership is always aware of the true status.

Accountability: More Than Just a Contract

Holding your system integrator accountable goes beyond checking off deliverables. It means ensuring they are invested in your long-term success, not just the project completion. This requires a shift from a transactional vendor-client relationship to a true partnership where both parties share the burden of success and failure.

In complex integrations, where the smallest data decisions can ripple through years of operations, transparency and rigor aren’t optional; they’re essential.

If you’re planning a system integration and want to ensure your partner’s guidance is truly in your best interest, schedule a consultation with us.