Don’t Let Perfect Get in the Way of Good Enough

By Tony Planos

In the highly competitive world of oil, gas, and mining fields, finding the right balance between determining which data to collect, how to best analyze it, what decisions can be made based on known versus assumed information, and, most importantly, what actions are critical for operational success is perhaps the most challenging and complex managerial task.

While the temptation to strive for perfection is understandable, especially given the high stakes and significant investments involved, this pursuit can often hinder timely decision-making and profitability.

Data is a cornerstone of the modern oil, gas, and mining industries. Advanced technologies now enable the collection of vast amounts of data from various sources, including geological surveys, seismic data, environmental impact assessments, and operational metrics. This data can provide invaluable insights into potential drilling sites, mineral deposits, and the overall efficiency of operations.

However, the sheer volume of available data can be overwhelming. The quest to analyze every piece of information to achieve a perfect understanding can lead to analysis paralysis. This is where decision-making is delayed because the data is too complex or voluminous to be processed efficiently within a reasonable timeframe. “Are we drowning in the data lakes?” a client dealing with this challenge once asked us.

Seizing market arbitrage opportunities in oil, gas, and mining requires that decisions are made swiftly. Fast market shifts, environmental conditions, regulatory and socio-political agendas, and competitive pressures can change rapidly, necessitating quick responses. Waiting for perfect data can result in missed opportunities, increased costs, and a loss of competitive edge.

For instance, consider the scenario of identifying a new site for extraction. Comprehensive data analysis might suggest the optimal spot, but the time to reach this conclusion could allow competitors to move first. Moreover, the costs associated with prolonged analysis, including deploying advanced analytical tools and expert personnel, can escalate quickly.

While it is crucial to avoid rushing into decisions without adequately considering risks, data accuracy and decision timelines must be balanced. Making decisions based on “good enough” data—sufficiently accurate information to inform action without being exhaustive—can often be more practical and beneficial.

This approach requires measured risk, confidence, and experience. To make informed decisions, leaders must trust their expertise and intuition, supported by data. They should be prepared to pivot quickly if new information or circumstances warrant a change in strategy. This agile approach ensures that operations remain dynamic and responsive to internal and external factors.

Effective risk management is essential when making decisions based on less-than-perfect data. Companies must establish robust risk mitigation strategies to ensure safety and environmental standards are not compromised. This includes:

• Scenario Planning: Developing multiple action plans based on data sets and potential outcomes. This helps prepare for various eventualities and reduces the impact of unforeseen events.
• Continuous Monitoring: Implementing real-time monitoring systems to track the progress and impact of decisions. This allows for immediate adjustments and minimizes potential negative consequences.
• Stakeholder Engagement: Maintaining open communication channels with stakeholders, including regulatory bodies, local communities, and investors, to ensure transparency and build trust.
• Regular Audits and Reviews: Conducting frequent audits and reviews of operational data and outcomes to identify areas for improvement and ensure compliance with industry standards.

Pursuing perfect data should not impede the ability to make timely and effective decisions. While data accuracy is essential, the realities of these sectors demand a balance between thorough analysis and swift action. Companies can enhance their operational efficiency and maintain a competitive edge by adopting a pragmatic approach to data utilization, embracing technology, and implementing robust risk management strategies.

Remember, sometimes good enough data is all you need to make the right move. Or, in the wise words of our drowning-in-the-data-lake client, “Try not to let perfect get in the way of good enough.”