External Experts vs In-House Teams: What’s the Best Choice for Oil & Gas Technology?

Navigate the critical decision between building internal capabilities and leveraging external expertise for your oil & gas technology initiatives.

The oil and gas industry stands at a technological crossroads. As digital transformation accelerates and operational complexity increases, companies face a fundamental question: Should they build internal technology teams or partner with external experts? This decision impacts everything from project timelines and costs to long-term competitive advantage.

With industry research indicating that successful digital transformations in the oil and gas sector can reduce operational costs by 20–30%, the stakes have never been higher. [1] The choice between internal and external expertise isn’t just about immediate project needs—it’s about positioning your organization for the future of energy.

The Current Landscape: Tech Demands in Oil & Gas

Modern oil and gas operations require sophisticated SCADA systems, real-time data, analytics, and seamless integration across multiple platforms. The industry’s technology landscape encompasses everything from industrial automation and IoT sensors to advanced digital twins and AI-powered predictive maintenance systems. Each technology brings its own set of implementation challenges and expertise requirements.

Technical complexity and speed-to-market pressures intensify the need for the right approach. At the same time, the talent pipeline is tightening: in the United States, roughly one-quarter of oil, gas, and mining workers are 55 or older, and workers 55+ account for about a quarter of the total US labor force. [2][3] The combination of harder technology problems and a shrinking supply of experienced specialists heightens succession and knowledge‑transfer risk—making it more important to decide deliberately which capabilities to build in‑house and which to source from external experts.

Building In-House Teams: The Internal Approach

In-house teams develop a deep understanding of your company’s culture, processes, and operational needs. They can respond quickly to issues and align technology decisions closely with business strategy.

Deep Industry Knowledge: Intimate familiarity with your assets, workflows, and regulatory context enables better day-to-day decision-making and fewer handoffs.

Complete Control: Direct oversight of priorities, timelines, and data handling—without vendor dependencies—keeps initiatives aligned and auditable.

Long-Term Value: Capabilities and institutional knowledge stay inside the organization, compounding over time into sustainable advantage.

The Reality of Internal Development

While internal teams offer significant advantages, the financial investment is substantial and the challenges are real. Building a competent in-house team typically takes 12-24 months, including recruitment, training, and team integration—factor in additional time for complex technology specializations and industry-specific knowledge development.

Cost Considerations:

• Senior Automation Engineers: $120,000+ annual salary
• Benefits and Overhead: An additional 30–40% of salary costs
• Training and Certification: $10,000–$25,000 per engineer annually
• Technology Licensing and Tools: $50,000–$200,000+ per year

A small team of 3-5 specialized engineers can cost $500,000–$800,000 annually before considering project-specific technology investments. Beyond the direct financial costs, companies face significant challenges in talent acquisition and retention, especially when competing with tech companies for AI, data science, and cybersecurity specialists.

The scalability challenge is equally daunting. It’s challenging to quickly add resources during peak periods or reduce staff during downturns without resorting to layoffs. Small internal teams can’t cover every specialized area—such as SCADA systems, cloud architecture, AI/ML, and cybersecurity—creating knowledge gaps that can become critical vulnerabilities. When key personnel leave, they potentially take critical institutional knowledge with them, creating single points of failure that can disrupt operations.

Leveraging External Experts: The Partnership Approach

External partners bring a compelling value proposition that addresses many of the challenges inherent in building internal teams. 

Cost Efficiency: Outsourcing can reduce IT costs by 20–40% and convert fixed costs into variable ones—pay only for services as needed. [4][5][6] For oil and gas companies, this translates to significant savings on specialized technology projects. 

Specialized Expertise: External partners bring deep, focused expertise in specific technologies, such as modern HMI systems and advanced analytics platforms. SCADA consultants, for example, understand the nuances of different vendor systems and can generally implement solutions more quickly than internal teams that have to learn from scratch. They encounter many more implementations—both successful and problematic—than internal teams do, providing them with a better perspective on best practices and enabling them to avoid costly mistakes.

Speed and Scalability: A medium-scale SCADA system ($50,000–$100,000) implemented by external experts can be deployed in 3–6 months, compared to 12–18 months with internal teams [Author estimate]. External partners can quickly scale resources up during major projects, such as SCADA system implementations or digital transformation initiatives, and then scale down during normal operations. This flexibility is especially valuable during market volatility.

Continuous Coverage: Managed service providers offer round-the-clock monitoring and support, eliminating concerns about vacation coverage, sick days, or after-hours emergencies. This ensures continuous operations without maintaining multiple shifts of internal staff.

Predictive Maintenance ROI

Beyond coverage and scalability, external specialists can also accelerate measurable outcomes. Conservatively, expert‑implemented predictive maintenance saves about 8%–12% versus preventive and up to 40% versus reactive maintenance, while significantly reducing unplanned downtime. [7][8][9]

Potential Challenges to Address

When working with external partners, organizations may encounter a range of challenges. One significant issue is the potential loss of direct, day-to-day control over activities, which can also lead to communication gaps between teams. There is a risk of vendor dependency, which could result in lock-in if the organization does not continue to develop its own internal capabilities alongside outsourced services. Additionally, sharing sensitive information with third parties introduces data security and intellectual property risks, making it essential to mitigate these concerns with robust contracts, non-disclosure agreements (NDAs), and clearly defined security protocols.

Cultural fit and alignment represent another set of difficulties, as external teams may not fully understand or adapt to the company’s norms and preferred ways of working. Financial and operational risks may also arise if projects are launched without clearly defined statements of work (SOWs) and service-level agreements (SLAs), leading to hidden costs or uncontrolled scope expansion. Finally, if offshore teams are involved, organizations may find that time zone differences and varying availability can hinder responsiveness, coordination, and the ease of scheduling meetings.

Decision Framework: Choosing Your Path

There’s no one-size-fits-all answer. The right path depends on factors such as company size, budget, technology complexity, timeline, and strategic priorities.

Choose In-House When:

✓ Core business differentiator technology

✓ Highly sensitive or proprietary systems

✓ Long-term strategic capability building

✓ Sufficient budget and timeline flexibility

Choose External When:

✓ Specialized, non-core technology needs

✓ Tight project timelines and budgets

✓ Limited internal technical resources

✓ Proven external expertise available

Assessing Your Situation

Small Operators (with fewer than 50 employees) are often best served by external partners due to their limited resources and the need for broad expertise across multiple technology domains.

Mid-size Companies (50–500 employees) may benefit from a hybrid approach—maintaining an internal team for core functions while engaging external experts for specialized needs and major projects.

Large Enterprises (500+ employees) can justify internal teams but still benefit from external partners for specialized projects, peak capacity needs, or emerging technologies where internal expertise doesn’t yet exist.

Critical Success Factors

Regardless of which approach you choose, certain factors remain critical to success:

Cybersecurity: Surveys show that two-thirds to roughly three-quarters of energy professionals expect higher cybersecurity investment in the coming year, with a growing focus on operational technology. [10][11][12]

Scalability: Select solutions that can scale with your evolving operational needs and technological advancements. Your decision today should account for where your operations will be in three to five years.

Integration: Ensure seamless connectivity with existing systems and future technology investments. Technology decisions made in isolation can create expensive integration challenges down the road.

Frequently Asked Questions

Key Questions to Ask Potential External Partners

If you’re considering outsourcing, evaluate potential partners carefully:

• Industry Experience: Do they understand oil and gas operations, regulatory requirements, and industry-specific challenges?
• Track Record: Can they provide references from similar companies? What’s their implementation success rate?
• Security and Compliance: What security protocols and industry standards do they follow? How do they manage access controls, data encryption, and compliance with regulations such as NERC CIP and ISA/IEC 62443?
• Scalability: Can they grow with your needs? What’s their capacity during peak periods?
• Technology Expertise: Are they proficient in your specific systems (e.g., Rockwell, Schneider, Honeywell SCADA)?
• Support Model: What are their response times? Do they offer 24/7 support?
• Cultural Fit: Do they communicate clearly? Are they responsive and collaborative?

Conclusion

The decision between building internal technology teams and partnering with external experts is one of the most consequential choices oil and gas companies face in their digital transformation journey. There’s no universally correct answer—the right choice depends on your specific situation, including company size, budget constraints, technology complexity, timeline requirements, and strategic objectives.

The most successful companies recognize that this isn’t an either-or decision. A hybrid approach that leverages the strengths of both internal teams and external experts often provides the best outcomes. Keep core functions and strategic capabilities in-house while engaging external partners for specialized needs, major projects, and emerging technologies where building internal expertise isn’t cost-effective.

Before making this strategic decision, honestly assess your current capabilities, future needs, and total costs over a three- to five-year horizon. Consider not just the immediate financial investment but also the opportunity costs, risks, and strategic implications of each approach.

The technology landscape in oil and gas will continue to evolve rapidly. The organizations that thrive will be those that build flexible technology strategies—combining internal capabilities with external expertise in ways that maximize operational efficiency, minimize risk, and position them for long-term competitive advantage.