To get better at getting better: Industry leaders discuss leadership, reliability, personal/process safety

Does the industry need to get better at getting better? The answer, according to panelists at the 3 March plenary session of the 2011 SPE/IADC Drilling Conference in Amsterdam, is a resounding yes. But how should the industry go about actually getting better? Well, that’s infinitely more difficult to answer. However, each industry leader on the panel – Graham Brander, Apache global drilling manager; Derek Mathieson, Baker Hughes president technology and product lines; Geir Slora, Statoil senior VP – drilling; and David Williams, Noble Corp chairman, president and CEO – offered their own approaches and strategies on how industry can continue to improve. The session was moderated by David Reid, National Oilwell Varco global account VP/E&P business & technology.

For Apache, Mr Brander noted that his company has achieved performance improvement in the past by focusing strongly on optimizing processes and finding innovative technology solutions. The company also in part relies on the human spirit/intuition factor for success. “I think this is the luck element, the ‘Ready, aim, fire’ questions that come into play,” he said.

In this industry, the boom and bust cycle can also put significant stresses on organizations. Mr Brander believes that this kind of “survival of the fittest” environment forces many companies to not choose the most comfortable path but to keep doing things differently in order to improve.

Looking to the future, Mr Brander believes that performance management must factor in capabilities to develop frontier areas and to make the most of mature areas by using new technologies. Growing interest from people outside of our industry also means we’ll have to do more to manage public and political relations. Mr Brander added: “There’s going to be more attention paid to what we’re doing as an industry on the green side of the business.”

He also cited leadership in technology implementation as a potential “blocker” to continued performance improvement. “We’re an innovative group. We’re an innovative industry. But why haven’t we gotten those innovations as a kind of mainstay of our core business?” Investments into new equipment and new technologies also should be continually reinvigorated and refinanced, he urged.

Mr Mathieson looked at how industry can get better through the perspective of reliability, citing three rules to guide improvement efforts.

Rule No. 1: You have to get data. Gathering this data can be a time-consuming effort, depending on the scope and scale of your business, “but it’s a critical step in making the investment decisions in engineering on where you want to focus your resources to make a change to get better,” Mr Mathieson said. “You have to dedicate resources to root cause analysis. It’s not enough just to record the data. You have to understand some of the fundamentals of what’s going on with the technology itself.”

Rule No. 2: Start impacting design immediately, which includes integrating reliability tools into the product development process.

Rule No. 3: You can’t do random. Global operating standards are absolutely necessary, as is competency assurance, to ensuring reliability. Mr Mathieson noted that a technology can have 98% reliability in one country but low-50% reliability in another – even though the technology itself is exactly the same. “An effort to both train and sustain that competency piece really can’t be underestimated,” he said.

Statoil’s Mr Slora kicked off his presentation by stating emphatically that the industry needs to get better. “Because the day you sit down and say that you’re good enough, that’s probably the day you start to get out of the business,” he explained.

There’s also a business context for why industry needs to get better: “We’re getting less output for more and more input,” he said. He pointed to the fact that the number of wells per rig has gone down, the cost per meter drilled and completed has increased significantly, and meters-per-day performance has decreased. All this while yearly investments have gone up, he said.

He pointed to four things that industry needs to do in order to get better: design for safety, speed and cost; ensure consistent quality; manage competence and risk; and be accountable for what we do. Among Mr Slora’s suggestions for improving performance include setting efficiency/cost as primary objectives, benchmarking everything from suppliers to your company’s own installations, and always looking to the best companies and learning from them.

Noble’s Mr Williams advocated the integration of personal safety and process safety as something the industry will need to address going forward. A great LTI record is “a great thing” by industry standards, but that record doesn’t necessarily cross over to good process safety too. “You have to have both,” Mr Williams said.

As a way to get better at getting better, Noble is also embarking on responding to process and safety issues from a behavioral point of view. A study the company conducted found that employees do have the knowledge and skills they need to make the right decisions, “but they were just choosing to do something different,” he said. “Clearly, changes in behavior were what were needed.”

Mr Williams added that, in order to make a good safety culture into a great safety culture, leaders must adopt a people-first approach, already in place at Noble. “For us, it’s all about the people,” he said.