Over the past couple of years, we’ve written several posts regarding the emergence of operational excellence in the Energy industry. While the benefits of operational excellence programs have been well understood for some time — greater productivity, improved safety, extended asset lifespans — the current low gas price economy is driving organizations to increase their focus on operational excellence as key to remaining viable during these times.
To further emphasize this importance, conferences like Operational Excellence in Oil & Gas are being held to help the industry share various approaches to and successes in addressing operational excellence challenges. Speakers generally addressed these challenges from one of three approaches: people, process, or technology.
Any operational excellence initiative requires strong adoption throughout the organization. Unfortunately, this is nearly always easier to say than achieve. The reality is that most companies find that without a focus on company culture and strong leadership throughout your management teams is necessary to develop the culture required for success.
Surprisingly, one of the more interesting discussions was given by an industry outsider. Ernie Spence, retired Commander from the US Navy. The Navy commander talked about the strategies that he successfully employees to retool and turnaround a struggling squadron. While his story has nothing to do with the processes or technologies that will drive operational excellence initiatives, his insight into the human factor had clear parallels to the struggles that oil and gas companies face implementing new programs today.
Improving operational processes receive the most focus during the two-day conference, with several customers speaking about the results of their process improvement projects. From my perspective, the most interesting sessions had a common theme: demonstrating how improved governance over operational processes yielded increased safety or operational readiness.
While the solutions to these issues tends to be very complex and requires a consultative approach to address each organization’s unique requirements, there were common pillars in each success story:
- Being able to communicate the status of your operations and/or individual processes is a key objective for any operational excellence program. Several customers pointed to simple, easy-to-understand dashboards as a critical success for factor sharing results both up to the executive leadership and down to the entire organization.
- Collaboration is also very important, eliminating unnecessary delays, especially with the global network of suppliers and contractors supporting your operations.
The final area of focus during the conference was on technology, and the highlighted management systems focused on improved management of two key pieces of information:
1. Structured data
A very popular investment that was discussed throughout the conference was leveraging data analytics to improve operations. While some critical parts have long provided at least some relevant data, the emergence of the Internet of Things (IoT) and Big Data technologies have driven new technologies that promise to dramatically increase the ability for organizations to monitor not only asset productivity but predictive maintenance.
2. Unstructured Data
While improved collection and analysis on structured data has some pretty clear benefits, companies often overlook the value that improved management and control of unstructured benefits provides fundamental benefits for operations and maintenance activities.
This is a conversation that is going to continue to happen over the remainder of the year. In early November, the Enterprise Content Division will be holding its Momentum Conference in Barcelona, Spain. At this conference, EMC and a number of its customers, will be discussing a variety of Energy industry topics related to information management, including Operational Excellence.
And while the European conference highlighted the challenges across Europe and the Middle East, the conversation will move to the United States later in November, where IQPC will host a very similar conference in Houston, Texas: Operational Excellence in Oil and Gas. I’m looking forward to exploring both the similarities and differences between North American and European markets, companies, and operational excellence program focus.
I hope that we will see you at one or both of these conferences. What are your experiences and expectations for Operational Excellence? Let’s discuss it below.