When Robert Peebler asked for a show of hands of oil-industry professionals who aren't unhappy about tech stocks' meltdown, he got an audience full of response. Peebler, vice president of e-business strategy and ventures for Halliburton Co., was addressing participants in The Oil & Gas Asset Clearinghouse's annual A&D dinner. Peebler was president and chief executive of Halliburton's tech business, Landmark Graphics Corp., since 1992 until taking on the parent's e-business this year. His message to the energy industry: the dot-com stocks have collapsed in the face of impatient investors, but the e-revolution cannot be stopped. There's no going back to business as usual, and that applies to the oil industry too. "The visionaries almost always expect change will happen fast...but the true impact takes longer, is bigger and is usually a bit different than the visionaries imagined," he says. Consider the automobile. Did Henry Ford think the car would one day become a mobile communication center, when adding the Internet to a cell phone, laptop or hand-held? Or, consider the TV set. Did even today's oil-company CEOs think, while they watched "Dallas," that the box would someday double as a miniature stock exchange or movies-on-demand personal theater screen? Irreversible change is already under way, Peebler says, and oil-industry executives need to understand that the business model is shifting. "Our business is going to shift in the next few years from vertical integration to virtual... The companies that figure that out and work on [changing their mindset] will have a huge competitive advantage." Virtual integration is like vertical: one company is involved in all segments of a business, from product development to the retail sale of that product. But, in virtual integration that company has outsourced most of the various responsibilities. What to do? "First, I can tell you we have way too much context." Context is what Dilbert and his colleagues work at all day-tasks that have nothing to do with the core, profit-generation aspect of the business. Eliminate the context in your business-as much as practical-and consider outsourcing a bulk of the cost centers that are left. Think unconventionally. "What if there was a worldwide production platform service company? That's the kind of thinking that's got to go on." Today it is the faster fish that swallows the slower (versus the traditional food chain of the bigger fish swallowing the smaller). "He who makes the best decisions fastest wins," Peebler says. Time is becoming more important than money. "This industry still has some of the greatest puzzles to be solved," he says. It is global, involves big money and "our model is goofed up...We need to change."

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