This week I met with a fabulous group of senior contract management people of #KPO. #Karachaganak Petroleum Operating Company is a large oil and liquified gas supplier. Among shareholders of one of the major taxpayers to #Kazakhstan‘s budget are the companies as #ENI, #SHELL, #Chevron, and well, Lukoil.
I have provided a training course dedicated to #strategic contract management to the mentioned audience. Within several days, we discussed a range of questions related to the professional discipline. How to ensure that contracts are delivered within the agreed time, scope, and budget to the clients, the legal and contractual pitfalls, why contract managers should sit with the negotiating team and discuss deals before they are signed by purchasing and sourcing representatives functions, and many more.
Employees’ attitude to work in Kazakhstan is impressive – I have met great, very knowledgeable, and dedicated professionals. We also discussed the disruption to #cpc – Caspian Consortium Pipeline, which impacts Kazakhstan’s largest oil fields – Tengiz, Kashagan, and #Karachaganak.
From the mix of experiences of working in several industries and having spent 15 years in oil and gas, my observation is that the petroleum industry rules of the game are more strict for suppliers. This leads to a higher contract management maturity framework including processes, procedures, etc.
Still, #digitalization , #ai , #machinelearning, and all tools which are more frequently used in IT and other market segments, are heavily impacting the development of contract management discipline. From what I can see, the oil and gas contractual function is not up to full speed with the market changes. Contracts are not flexible, way too complex, use of the software is restricted to certain big ERP dominance, etc.
I do believe that nowadays, to be fully aware of what is going on in the contractual world, one industry experience is not sufficient. I think that the days when people belonged to one organization are gone forever. My message to people in oil and gas who did not make changes in careers for decades – it is time to leave and see the other reality.
PS: If you would like to have a contract management diagnostic or see where improvements could be brought into the contractual lifecycle within your organizations, including digitalization of the contractual activities, or your contract team needs training, feel free to reach out.