In the oil and gas industry, information technology (IT) is a key component for exploration and production (E&P) organizations. And while there are a range of IT domains relevant for E&P (such as data warehousing, networking, unified communications, and enterprise resource planning), in this article, I want to focus on enterprise content management (ECM) – i.e. how an organization manages its content (primarily documents such as spreadsheets, PowerPoints, word-processing documents) to achieve business objectives. ECM is an IT domain that holds great promise for delivering significant value to E&P firms of all stripes.
The value IT has for the management of content in E&P organizations will be realized over the near term in four areas:
- Digitization – converting paper-based, manual business processes to paperless, automated ones
- Mobility – enabling mobile access to and management of content
- Collaboration – facilitating interactions between distributed, global teams
- System integration – using ECM as the “glue” to bring together systems for managing assets, financials, and supply chain with the documents related to them
Let’s take a look at each of these in greater detail.
Digitization technology has been available since the 1980s, and over the last 30 years, paper-intensive firms in information-centric industries such as insurance, banking, and financial services have made great strides in digitizing their core business processes. In contrast, most organizations in the energy sector have only begun investing in digitization in the last decade or so – and even today, many oil and gas firms have little to no digitization in place, even for core back-office processes like accounts payable or accounts receivable, let alone for front-office processes like environmental health and safety (EH&S) documentation, engineering drawing management, or asset management.
Given the relative immaturity of digitization among E&P firms, here are some “low-hanging fruit” opportunity areas IT can address:
- Accounts Receivable (AR) – If you currently have a paper-based, manual billing process, the result is a higher proportion of overdue receivables. Digitizing AR documents and automating the process with workflow tools better ensures that the right bill goes to the right person at the right time, and that follow-ups and reminders go out as well – all of which reduces the number of bills that are unpaid because of errors in delivery and follow-through.
- EH&S Documentation Management – A paper-based, manual approach to creating, publishing, and enforcing EH&S standards and standard operating procedures is more expensive, more risky, and less traceable than a digital, automated approach. Having a central, digital repository for the latest and greatest EH&S documents, a consistent indexing protocol for those documents, and a user-friendly way to find and publish them increases the likelihood that mission-critical E&P employees will have the right EH&S documents at the right time, helping to increase compliance and decrease the risk of EH&S incidents.
- Asset Management – Managing the documents relating to assets is critical to E&P success, whether large-scale production assets, like an entire well site, or discrete assets, like a conveyor belt. When the management of key asset documents (e.g. ”as-builts” or inspections reports) is paper-based and manual, substantial inefficiencies are introduced into asset operation – for example, shutdowns because the wrong part was ordered or the wrong maintenance activities were performed. Digitizing these key asset management documents and automating the process of filing and publishing them decreases the likelihood of operational errors as a result of missing or incorrect documentation.
Other than cloud, mobility has been the biggest buzzword of the last few years. Leaving aside the hype and techno-speak, what mobility basically means from an ECM perspective is enabling users to access documents, as well as the ability to manage documents, from mobile devices. Given the typically global, often highly distributed footprint of most E&P organizations, there are two main areas where IT delivers ECM value through mobility:
- Field Operations – E&P employees in the field, like drillers, geologists, and engineers, are often the most highly skilled (and highly paid), so maximizing their time on task is critical, both to keeping costs down as well as maintaining capacity. Giving these field employees mobile access to key documents (e.g. standard operating procedures or drawings) can save hours and even days of lost time and down time, not to mention reducing the risk of EH&S incidents.
- Virtual White Collar Employees – When managers and executives work virtually due to travel, flexible commuting arrangements, or for other reasons, the inability to access critical documents leads to inefficiency in business processes (e.g. workflows involved in timesheets, expense reports, hiring, or budgeting). Mobile access to these documents means less time engaged in administrative activities and more time leading – which, let’s face it, is what these employees are being paid to do.
Enterprise collaboration is a big topic these days, mostly driven by the popularity of consumer tools such as Facebook, LinkedIn, and Twitter, and the increasing availability of software that provides analogous functionality for businesses (e.g. Microsoft SharePoint and Yammer, Jive, IBM Connections). As with mobility, the global, distributed footprint of most E&P organizations means there are ample opportunities for IT to deliver collaboration capabilities to the business. Two common scenarios are:
- Global Functional Excellence – Ensuring process standardization across sites and geographic locations is critical for E&P organizations, not only to gain efficiencies but to maintain compliance. And, as we saw with the impact of digitization on EH&S documentation (above), facilitating collaboration between distributed employees is easier, less expensive, and more effective using ECM capabilities.
- Employee Onboarding – Getting new employees up and running as quickly as possible is mission critical not only to hit production targets, but also to reduce drag on tenured employees who must “babysit” the new hires. The typical approach to onboarding is to pair newbies with veteran mentors who can show them the ropes for a while, then move on. The result is often an overburdened mentor, an overwhelmed newbie, and longer time to onboard completely. Using ECM technologies to facilitate social collaboration between new employees and the entire community of tenured employees reduces the burden on face-to-face mentors, increases the experience pool for the newbie to draw on, and more quickly builds the employee’s sense of belonging to the organization.
Although “technology” for an E&P organization most often means the physical technology used to find oil and get it out of the ground, you wouldn’t know it by the tangled web of software most E&P firms have deployed to do everything from measuring production and operations, to tracking financial and supply chain activities (and everything in between). For those organizations that have a large, disconnected portfolio of software and systems, ECM becomes the “glue” to bring together enterprise systems with the documents housed in the repositories associated with those systems. And while the specific use cases will depend entirely on the specific systems in existence at a given E&P organization, here are some examples of how IT can drive value through ECM integration:
- Construction – Most firms have systems to manage the construction process, whether in terms of finances, overall project management, or the process of creating drawings and plans. However, the documents created and managed during each of these aspects of the process often live in multiple repositories, in multiple versions that are conflicting or ambiguous. Integrating these diverse systems and storing all the key documents in a single repository increases the efficiencies in the construction process and reduces errors and risk exposure.
- Asset Maintenance – As with construction, most organizations have a system such as SAP or Maximo to manage the asset maintenance process. But when that system kicks out a work order to perform maintenance on an asset, the process of scoping and scheduling that work order is manual and time-consuming, primarily because the key documents required to do so (drawings, plans, inspection reports, etc.) are stored in multiple places. By integrating asset maintenance systems with ECM repositories, these key maintenance documents can be made available in real time for craftsmen and other employees who need them, reducing the time it takes to schedule and perform maintenance as well as reducing the risk of EH&S incidents resulting from out-of-date or incorrect documentation.
We’ve only scratched the surface of how IT can add value to E&P organizations through ECM. But the idea is to give you a good introduction to what ECM is and why it matters to E&P, as well as some specific use cases where you can begin to address ECM at your organization to drive value.