The adoption of digital innovation in the South African oil and gas industry

Abstract

The ability to effectively adopt digital technology innovations such as Artificial Intelligence, Machine Learning, Digital Twin, and cloud computing is crucial for any’s organization's continued growth and success. As much as innovation promises substantial value for organizations, not much is known about the attributes or factors that facilitate or impede innovation adoption. In addition, less is also known about how these attributes and factors influence adoption. There isn't much empirical data to support the growing significance of innovation through digital technologies in enabling the transformation of oil and gas organizations in South Africa, even though innovation globally is a growing phenomenon. The purpose of this study was to investigate the factors that influence the adoption of digital technology innovation in the oil and gas industry in South Africa. The literature showed that there are number of factors that influence the rate of digital technology adoption and out of these the most prevalent ones were investigated for applicability in the oil and gas in South Africa. This study explored factors that were more prevalent in the oil and gas and grouped them into two categories, namely, knowledge and persuasion factors. The DOI theory was used as lens to explore the factors that influence the adoption of digital technology innovation. The theory has helped in categorizing and grouping the factors.

Data for this study was collected through survey questionnaires sent digital innovation subject matter experts from multiple companies in the oil and gas in South Africa. Trends in the data was observed through descriptive analysis and regression analysis was conducted to assess the relationship between the rate of adoption and the influential factors. The relationships were observed and the related extent of the relationships, if existed. A statistically significant positive relationship was found to exist between the rate of innovation adoption and two main factors, Know-How knowledge and motivation. In order to accelerate the rate of digital technology adoption in the oil and gas industry it is recommended that organizations should invest and prioritize building hands-on digital technology and leadership skills. Organizations should also focus on change management activities aimed at motivating current employees showing them benefits and opportunities brough about by digital technology adoption. This will serve as an incentive to ensure that they support and champion the initiatives. Digital technology initiatives should be made visible for awareness purposes and showing the transformation achieved and value unlocked