Industry Insight: IM Benchmarking
INDUSTRY - Oil and Gas, SOLUTION - Information Management, SOLUTIONS - Industry Solutions
Jim Crompton - Noah Consulting
There is a lot of buzz in the industry about data management maturity. Companies have been asking Noah Consulting how they stack up against other energy companies since Noah has an IM Maturity Report Card and interview process that has been successfully implemented with several clients. As a result of the interest expressed in data management maturity, Noah decided to host an event to get companies talking to each other. On April 11, 2013, they hosted an Industry Roundtable workshop in Houston, Texas, on the topic of IM Benchmarking. The event brought together representatives from Concho, Southwestern, Breitburn, Newfield, EP Energy, ConocoPhillips, BakerHughes, AMEC, Anadarko, TGS, Swift Energy, and Devon. Despite all being on different paths in the IM journey, there was a lot of interest in benchmarking the maturity of each company to learn from others and to help communicate with senior leadership. To accomplish this goal presentations by Fred Kunzinger , ”IM Maturity Benchmarking,” followed by a presentation by Jim Crompton on “Alignment and Governance of Digital Assets in the Oil & Gas Industry” set the tone for the discussion. Some of the points of their presentations include the following key principles:
• Proper information management has strategic value and is critical to the success of E&P with information widely accepted as a key corporate asset impacting operations, regulatory, and financial performance.
• The approach to information management should support and be aligned with the Exploration and Production Strategy.
• Large amounts of money are spent on technical data. As such, we have a fiduciary responsibility to protect this investment and to get a good return on that investment.
• The information management approach and priorities in each company are driven by pain points and specific leadership initiatives. A standard solution does not exist in the industry today.
• Information management with solutions showing new business capabilities is typically a hard sell to the business. IM efforts that only improve existing solutions by providing better data are challenging to develop.
A short questionnaire was distributed and a facilitated discussion around those questions lead to some very interesting insight. Here is a listing of the questions and a summary of the group’s responses.
Q: What is prompting the current information management focus at your organization?
A: The focus of information management varies among companies with attention to subsurface data, equipment and facilities data, and production data most often mentioned. But in most every case the basic issues of data quality, the capability to produce the right data for reports, availability of trusted data, and the ability to load data to applications for analysis and interpretation exist.
Q: What is the “attitude” towards information management at your company? Necessary Evil? Added Value? Mission Critical? Or somewhere in the middle?
A: The reality is that, at most companies, the attitude towards information management is still that it is a necessary evil and a painful process, but that some disciplines and business units were starting to see the added value of better data management practices.
Q: Does information management live in your company? If so, where? Where did it live 2 years ago? Where is it going to live 2 years from now?
A: Different companies have evolved different organizational structures to house the information management function. In some organizations, it belongs to IT, in others it is shared between IT and the business. A few organizations have separate data management groups.
Q: How well do IT & the business partners deliver information management at your company? Do you have an appropriate business focus? What business factors are changing your focus and thus maturity (unconventional plays, increased competition, growth via acquisition, recognition of value via IM, innovative technologies)?
A: The general consensus is that companies are seeing the influx of tons of data, but are having trouble finding the right information. The loss of experienced professionals makes it necessary to get your house in order. Some approaches focus on capturing and storing the data without the associated context, experiences, and audit history.
Q: Are you governing data in a structured manner? Done by owners and is any of that load automated? Supported by senior management? Method to enforce it? Is adherence to IM governance built into everyone’s goals and objectives?
A: Data governance is starting to be recognized as a valuable process. The maturity of data governance usually grows from division and functional initiatives, but it is a long journey. Governance includes common definitions, standards, data ownership, and business rules. The goal is to have less bureaucracy and a cultural shift to produce faster decisions. Governance is important, but agility is more important.
Q: Applications are fit for purpose but workflows are more interconnected than ever before. This interconnection causes master data to rise from nice to have to must have. How has this changed your information management focus? Do you have a master data management capability? How mature is your master data management capability? Is it automated or manual? Is it effective? Is it efficient? Is this a central focus?
A: Getting support around a MDM program is a challenge. There is a recognition that common reference data, like well identifiers, are essential, but the sophistication required for an enterprise MDM approach is difficult to come by. Companies are struggling to get traction on this important element.
Q: In previous years, analytics meant getting your reports on time or being able to get your data into an excel spreadsheet. What does analytics mean to your company today?
A: “Analytics” has many definitions, but the first step is to provide access to data. Often, access uncovers data quality issues, which put you back to square one. If you can get beyond the basic requirements, you find that most engineers are doing some level of analysis, but the tool of choice is Excel. If given a choice of giving up IT or Excel, most would give up IT. There is a lot of massaging going on at the desktop level. Companies work really hard at not letting high level personnel know how bad the data really is, so execs see no issue, therefore it is difficult to get approval for funding to improve. Most companies are still at the data management starting line and plan to get to better use of data, but have to deal with the basics first.
Both Fred and Jim pointed out that effective data governance and alignment of projects is difficult, especially between different business units and global functions. But there is significant business value to be realized through the effort. Examples of just a few ways that effective governance contributes to business value include:
a) IT efficiency and reliability through rationalization, standardization, and shared services
b) Supplier / Vendor benefits (contract leverage, supplier alliance relationships, rent new skills)
c) End user productivity d) Supply chain benefits (lower friction in exchanging data, i.e. WITSML and PIDEX)
e) Decreasing the complexity of the current data landscape in your company
f) Providing a data platform for significant innovation
Alignment usually focuses on investment priorities and processes in an organization. But there was an interesting discussion around the topic of alignment of people. Jim introduced a framework which included different categories of roles and different characters that fill each role:
• Architects: core, pathfinders, cowboys, and hijackers
• Project Teams: followers, adapters, and mavericks
• Management: evangelists, sponsors, distracted and distrustful
Most participants could picture individuals in their organization that fit many of the roles described and the influence they had, both good and not so good, on the successful execution of projects. The thought leaders provided interesting insights and challenging perspectives. The discussion was lively and very relevant to current challenges that each company was facing. The networking was valuable and the IM journey in these companies continues. Noah’s objective to facilitate the exchange of knowledge about data management maturity was met with more to come in future round table events.
If you are interested in attending a future industry Roundtable, please contact us.