Oil giant Shell, faced the twin demons of an IT security failure and the need for IT to contribute to considerable savings in the first months of 2010.
In early February 2010 Royal Dutch Shell revealed that the details of 176,000 employees had been exposed by email to campaigners targeting the company for its controversial activities in Nigeria. IT systems at Shell failed to detect and prevent emails with the staff details from leaving the company, the details included home phone numbers.
Shell started out in 1883 as a seashell importing business, today Royal Dutch Shell is a massive petroleum and gas multinational with roots in Britain and Holland. Depending on whether you choose to believe Fortune or Forbes, it is the world's largest or second-largest corporation.
Keen to maintain its position, Shell has invested some $18bn on a Qatar facility and spent more heavily than ever in 2009 to grow production. The company collaborated with Exxon Mobil to develop an oilfield in Iraq. That news might help to offset concerns over plunging earnings caused by falling demand for energy and falling oil prices but the market is still "very uncertain" in the words of new CEO Peter Voser. The firm was left unscathed by Tropical Storm Ida in the Gulf of Mexico where it has operations.
Shell has an enormous IT investment too with angel wing Shell Technology Ventures and a huge war-chest supporting the ongoing search for fuel. A big user of outsourcers for IT, networks and telephony, HP's acquisition of EDS will have a significant effect on the company as EDS was a key supplier, along with T-Systems and AT&T in a $4bn contract affecting 3000 staff.
Group CIO and 27-year Shell veteran Alan Matula is clearly a believer in sticking to core competencies. "This deal is a major strategic choice for Shell. It allows Shell IT to focus on information technology that drives competitive position in the oil and gas market, whilst suppliers focus on improving essential IT capability," he said on the deal being agreed.
The challenge now for Matula is pushing forwards a standardisation, offshoring and simplification programme Shell is demanding in order to reduce its costs by £1.9 billion. Shell earnings in 2009 fell by 70 per cent and the company plans to cut staff levels by 1000.
In May 2009, Shell reorganised IT and created a new Projects & Technology unit. This is part of Voser's drive to make Shell a nimbler organisation that can make decisions more quickly than previously. He has described the division as exemplifying how Shell can use "internal mergers" to drive down cost and improve decision making.
Shell is also reported to be pushing on with major identity management projects to control access to its core SAP enterprise applications and other tools.
For company report in 2008, Shell said it had increased R&D spend to almost $1.3bn and employs about 30,000 staff in technology and holds over 30,000 patents either already issued or pending.