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8/8/2019 IADC J de W Presentation Nov 07
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REALBUSINESSGROWTHINTODAYSOILFIELDENVIRONMENT
John de Wardt,President,DE WARDT AND COMPANY INCwww.dewardt.comPresented at IADC Annual Meeting Nov 2007
DE WARDT AND COMPANY
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The ideas I want to share
Ride the wave or true growth? Understand real value delivery and differentiation Look at alternative futures Systems and behavior for project management Lean manufacturing is a must
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Ride the wave or true growth?
Cyclic industry / volatility Up cycle adds competitors Down cycle erodes market share
Hydrocarbon delivery is an extended supply chain Unstable characteristics
Pricing pressures Customer to supplier, supplier to customer
Now - oil companies are impacted at high oil prices BP, Shell, ExxonMobil higher operating costs Major project overruns
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Understand how to drive real value delivery and
differentiation
Customer value ultimately drives the business It is why they pay you
Differentiation is through competitive advantage It can and will be eroded
Competencies underlie delivering both Competitive advantage Customer value
Distinctive competencies Invest in them Develop into a strength
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Essential values for oil companies
Functionality and quality of product or service Drives throughput and up time = revenues
Capex and Opex costs Cost to produce and operate
Cycle time from cost to revenues Speed of delivery
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Look at alternative futures
Only thing oil price forecast have in common they are all wrong!
Surprises happen Competitor mergers, Regional downturn (e.g. Canada) & contagion Political shifts nationalization, taxes,
Create different stories about the future Test your business against these stories Strengthen weak areas Develop counter measures Seize opportunities
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Managing the speed and cost of delivery is critical
Areas of significant opportunity: Project Management Lean Manufacturing
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Systems and behavior drive success in
project management
Differentiate ongoing work from projects Require different management methods Gray zone is customized products
Work breakdown structure (WBS) in systems Delivery of components of the work Architecture of Project organization
Risk & Uncertainty management Qualitative and quantitative methods SPE 97269 Best practices / misapplications
Scheduling Planning / scheduling is a discipline
Strong management Disciplined approach
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A short history on Lean Manufacturing
Toyota Production SystemTaichi Ohno
SMEDCellsMIT study
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Industry has entered a new era of organizing and
managing businesses
CRAFT
MASSLEAN
PAST 1900s 1990s FUTURE
100 %
0 %
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Lean manufacturing is the driver to world class
performance
Work center (Cells) optimization Added 10 points to margin
Design to build 27% reduction lead time in very large customized product
Sub assembly flow Final assembly time cut in half
Facility flow Massive impact that is often unrealized Lead time reduction from 5 days to 1 day
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Some key observations
Low percentage welding time Increase low percentage increases throughput
Poor work center organization Welding on Paint
Process needs fixing Large number of fork lifts
Usually want more! Poor work flow
Rework number one wasted effort Sometimes it is everywhere Who is taking care to fix it?
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Some key observations
Bottlenecks visible and invisible Blast and paint is typical Engineering drawings
Materials management Parts and materials are often late
Client specification decisions Delays are typical (some are change orders)
Work flow improvement on the drill floor Lost opportunity
Design to build well components Work flow
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Benefits from Lean manufacturing surpass
standard measurements
Lead time reduction Significant impact from Lean Manufacturing Significant impact to flexibility and delivery
Throughput increases are significant Increased revenues for the investment
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New entrants leverage from Lean
GE impacts Vetco GrayPurchase January 07Riser production from 38 to 10 days by September 07
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Gaining advantage for real business growth
Understand your customers value and how you driveit Know how you (will) compete to deliver that value Improve your performance through the besttechniques Test your business against uncertain futures
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Thank You
John de WardtIADC Memberwww.dewardt.com
DE WARDT AND COMPANY
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