Background
The oil & gas industry is a highly competitive and complex market, and suppliers of drilling equipment must meet strict quality and safety standards to ensure reliable and efficient operation in challenging environments. These suppliers may also provide related services such as installation, maintenance, and repair of the equipment they supply.
Our client provides drilling rigs, equipment, personnel, and camps on a contract basis to explore and develop oil and gas from onshore areas, fixed platforms, tension-leg platforms, and spars in offshore areas. Operating globally, the client is headquartered in North America and owns the largest land fleet of AC drilling rigs in the world.
Analysis
The client initially engaged us to review field operations and help determine why rig manager workloads had increased dramatically in the current upturn. Through a six-week analysis, we discovered that the client lacked a systemic management control system (MCS) to adequately monitor remote sites and funnel issues through the districts in a timely fashion.
After successfully concluding the initial project, we shifted focus to work with the client at its headquarters in North America for a massive 49-project engagement that covered the following areas of importance:
- Remote site management
- Maintenance effectiveness
- Business reorganisation
- Engineering effectiveness
- Supply chain optimisation
- Developing and rolling out the employee change champions programme
- Human resource improvement
- Sales and marketing improvement
- IT reorganisation and efficiency improvement
- Finance improvement
- Shareholder value mapping
- Contractor and third-party management
- International operations review
- HSE (Health, safety, and environment) effectiveness
- Merger and acquisition integration planning
- Designing the enterprise dashboard and daily operating report
Project Approach
What began as a six-week rig manager Day-In-The-Life-Of (DILO) analysis quickly transitioned into a company-wide approach that took place over three-and-a-half years. We partnered with executive leadership to develop systemic changes within each area.
Building upon our success in helping the client understand and improve the work and efficiency of rig-based management and operations, we started this new project by improving the way that districts were managed. Subsequently, we developed and installed a District Management System that gave planners visibility into — and effective management of — operations within the districts.
We also helped reorganise the IT department’s structure and the way data was handled, visualized and used by the organization. We assisted the finance department in instituting practices that captured about US$30 million in overdue receivables.
The engineering group asked us to help them institute a management system and demand management process. These improvements led to our partnership with the company’s HR department to develop a corporate training group, employee development process, and a long-term HR strategy.
Project Implementation
District Management System
In order to drive consistent and consistently efficient performance across the fleet, we developed a Rig Management System (RMS) that allowed planners to set new planning expectations, develop action plans, monitor scorecards, generate daily and weekly operating reports, and give up-to-date information through dashboards, among others.
Operational Support Services (Rig Value Chain)
We developed and implemented clear roles and responsibilities across four main organisational groups:
- Centre of Excellence
- Continuous Improvement
- MRO (Maintenance, Repair, Overhaul)
- Supply Chain
Change Champions
In coordination with the newly created Continuous Improvement function, we established a 20-week program that focused on the following areas:
- Training in Lean production principles and Six Sigma basics
- Exercises and drills to integrate key aspects of the training with best practices from the client
- Integrating the change champions into our ongoing workstreams
- Getting the change champions to facilitate selected projects under our supervision
Job Safety System Effectiveness
In addition to exposure recognition training programmes, we also developed an SIF (Serious Incident Fatality) workgroup to assess the content of all safe work procedures, creating a revised structure that focused on safety-critical tasks.
Additionally, we developed an interactive pre-job safety meeting to engage participants in a more effective manner, as well as an audit system to observe safety-critical tasks and ensure adherence to safe work procedures.
Engineering & Organizational Effectiveness
We developed an Enterprise Portfolio Management (ERP) system which included:
- Knowledge management integration with the client’s key operational functions
- Investments in transparency and cross-functional collaboration
- Critical examination and re-definition of key processes
- Identifying potential organisational structure changes to improve engineering value to the changing needs of the client
- KPI dashboards, weekly exception reporting, and stage gate development processes
“The Change Champion program is one of the most important initiatives conducted in this organisation. The results are significant and far-reaching.”
CEO
Results
US$75 million
Savings
300
Employees trained to become Change Champions
20%
Reduction in drilling material and supplies
We helped the client develop a culture of continuous and sustainable change, drive down the risk of major rig-based injuries, reorganise their value chains, and deliver a closed-loop performance management system.Â
From the client’s request to help the workload of their rig managers, what we ended up delivering was a holistic understanding of a company-wide opportunity for improvement. By partnering with us, the client has transformed their culture into one that is efficient, data-driven, and intentionally managed.
