[Transcript] The Hess Way - How operational excellence leads to increased safety and productivity
For the original podcast, visit this link.
Guest presenter, Sean Glynn of 3Gig Software spoke to Roddy Evans, Global Integrity and Relability Project Manager from Hess Corporation about the planning, implementation and resulting benefits of The Hess Way - Hess' own strategy for safety and operational excellence in oil & gas.
Sean Glynn: Hello, and welcome to Process Perspectives, a podcast series produced by the Process Excellence Network. The Process Excellence Network is, of course, an online and events community for process professionals, and I am your guest host for today’s episode. My name is Sean Glynn with 3GiG Software, an integrated technology and services company for the upstream oil and gas industry based here in Houston. In today’s program I'll be speaking with Roddy Evans, who’s the Global Integrity and Reliability Manager at Hess, who will talk about the importance of operational excellence at Hess, and about encouraging a culture of innovation. Roddy, welcome.
Roddy Evans: Good morning, Sean.
Sean Glynn: Thank you for joining us today. Let me start by asking you just to tell us just a little bit about yourself and your role as Global Integrity and Reliability Project Manager at Hess.
Roddy Evans: Thanks, Sean. I'm an engineer by background with over 33 years experience in oil and gas. Took up a variety of engineering and maintenance roles in my career in a variety of locations worldwide, and I suppose about 17 years ago I started to focus on striving for excellence in maintenance and integrity in the oil and gas upstream world and this has been my passion ever since. I became fascinated by how best to improve processes, systems, and most importantly the practices in the front line, leading… what I found fascinating was it led directly to bottom line results. It was great to see the impact on the bottom line but also the benefits to the people, primarily in terms of their safety, but also in making their working life more productive and proactive rather than reactive and, often, stressful at times.
And I learnt that for operations in maintenance that change really has to happen in the front line. It can't happen in the office, and my role now is to lead integrity and reliability improvement across all of our assets globally, and I must say it has been refreshing to join a company with such a can-do culture. Rather than meeting and managing lots of resistance to proposed improvements, our challenge early on was often to slow down the operations team to ensure they implemented in a proper, sustainable way to ensure we had a deep implementation embedment rather than what often happens to be… comes out to be an inch-think, mile-wide implementation.
Sean Glynn: Okay, so I know that operational excellence is very much a key pillar of success at Hess and a big part of what you call the Hess way. Can you tell us a little about how you apply the principles of operational excellence within your production operations role at Hess?
Roddy Evans: Yes, Sean. Well, to me, fundamentally, operation excellence is about a culture of continuous important, to never be satisfied with the status quo and always strive to look for those opportunities to make things better. Our principles are really around setting standards, identifying gaps or opportunities, leveraging best practices across the organisation, and then developing and implementing, and most importantly, sticking to world class processes. And then, of course, we measure what we do, following that old adage, what gets measured gets done, and finally, promoting learning and sharing across the organisation. So, those are the principles we try to follow, and for our production operations, we started by putting in place an overall framework which we call Production Excellence. It looks a little bit like a house with five pillars, and each of the pillars represents what a production organisation needs to do really well.
Starting, of course, with Environmental Health and Safety, ensuring no harm to people or the environment. And then Integrity, or sometimes, in some parts of the world, call Process Safety, ensuring that we prevent really bad things from happening like fires and explosions. And then Reliability, the middle pillar, looking after our equipment to ensure that our operations are predictable with a sustained, high uptime. The fourth pillar is Production Optimisation, where we effectively manage each molecule in our reservoirs, effectively optimising short-term and long-term production to achieve maximum value to the business. And finally leading to Cost Management, understanding and managing every dollar of our expenditure, spending our money wisely.
So, how did we apply those OE principles, those Operational Excellence principles, to each of these pillars? Firstly, back in 2010 we built a strong coalition of leaders across the organisation to sponsor the change, and then we worked with these leaders to set clear standards, and we documented what we called expectations. And then we communicated our vision and expectations across the whole organisation. We did town halls, we had team workshops, posters, websites, you know, seven times, seven different ways. You can't really overcommunicate a change of this scale. And then we assessed our gaps and developed a phased strategy for important. You have to recognise that to make change truly sustainable you have to allow time for people to absorb it and to own the changes. This is a multi-year program, a marathon, not a sprint.
And then we worked with subject matter experts across… in our asset teams globally to develop and implement the best practice processes to close the gaps. We measure, we use a suite of production excellence metrics to measure progress, promote sharing and learning, and to drive further improvement, and then we assess. We use health checks, but very important, the annual assessments of practices out in the field. These assessments aren't done by corporate bodies but they involve representatives from other assets, so we also promote cross-asset learning and development, another key element to ensure sustainability and continuous important for the future. And then finally we take the results from the assessments and the metrics and we reflect on them on an annual basis and identify the next tranche of opportunities for improvement; a true cycle of plan, do, check, and adjust.
Sean Glynn: Thank you, Roddy. And that certainly talks at a high level around the production operations and how you apply your OE principles there. But let me ask you more specifically to your own role. Can you expound a little on how it applies in terms of the work you do in asset integrity and reliability?
Roddy Evans: Okay, Sean. Let's look at reliability for example. So, we developed a set of ten expectations for reliability to describe what good looks like. They covered aspects such as asset data quality, planning and scheduling, preventive maintenance programs, training and competence. This is all basically common sense stuff, but unfortunately it's not common practice in our industry. We then carried out baseline assessments using the Marshall Institute to compare our practices in the field against our expectations. Again we communicated widely, and for maintenance and reliability everyone attended a one-day, world-class maintenance training session. So, we all had a better understanding of why we're embarking on the journey, what we aim to achieve, what good looks like, and most importantly, what's in it for me.
We then developed the phased strategy for improvement, and for maintenance and reliability that was firstly focused on defect elimination, to address unreliable equipment, or bad actors as we call them. And in parallel we focused on planning and scheduling our work so we do it right the first time. All of that was aimed at achieving what we call a planned state, where every day is predictable, work is organised properly, and people’s time is more productive. Again, this was a marathon, not a sprint, so that took two to three years of hard work for our assets to achieve that planned state. But it's given our teams the space to focus on proactive activities such as optimising our preventive maintenance, optimising our spares requirements, and improving our day-to-day job plans.
Sean Glynn: Thank you, Roddy. Now, earlier in the conversation you talked about Hess’s can-do attitude, and I know that Hess is well-known for a very strong culture of encouraging innovation and encouraging continuous improvement from its employees. You’ve talked about already how this is a key to the company’s success and growth. Can you tell us about the processes you’ve introduced at Hess to help encourage and enable that continuous improvement?
Roddy Evans: Indeed, everyone in the organisation has a part to play, and everyone’s ideas count. We really try and engage the whole organisation from top to bottom. And those ideas might be small or large. They might be incremental or step changes. We basically need them all. However, when we looked at how we managed these ideas back in 2010, we found that a lot of our people and our teams were working independently to improve their own area of the business and there was limited cross-learning. And most of the ideas were captured on flip charts, reports, or individual spreadsheets. There was little visibility or coordination overall. Also, we found that we were often poor at following through on screening, and prioritising, and implementing these ideas. So, we started to introduce a process to capture and track these ideas, or opportunities as we called them, in our Production Optimisation pillar.
This has since widened to other pillars of production excellence over time, and in 2013 we conducted a check-and-adjust review of this process with key users. Our aim there was to make it simple so anyone in Hess, employees and contractors alike, can register an opportunity or idea with just a few simple clicks. There were six steps to take an opportunity from the idea through prioritisation, to implementation, to close out, and including a look back to assess what was achieved, what could be learned and shared. Then we wanted to make sure it was sustainable primarily through embedment in the business operating rhythm, of routine meetings and activities, and through metrics and regular assessments. And then finally we wanted to standardise that process, we called it One Process One Tool, for all Hess assets. And now our central functions are also helping us to prioritise in an integrated way so we can try and manage the initiative load on the overall organisation.
So, the tool we're using is based on Prospect Director from 3GiG. Now, I'm not an IT wizard but I'm told that this is a smart process application platform, whatever that means. Anyway, we found it to be highly configurable to our process and organisation, very quick to implement, very intuitive, almost fun for people to use. It was also easy to engage the key users in the design, so we could optimise the design and we now have ownership of that design across the organisation. And we've since used Prospect Director to meet a number of other business needs around making our processes and information visible with similar results.
Sean Glynn: Very good. So, can you tell us a little bit about the impact that this has had at Hess, and how maybe that has grown over time?
Roddy Evans: Yes, sure. Well, as I said, Sean, the opportunity process started with our Production Optimisation pillar but it quickly caught the attention in other parts of production excellence and widened to cover the Cost Management pillar, for instance. In fact we also follow the same process to track progress on addressing our underperforming equipment, or bad actors, in the Reliability pillar. And in the past year we've been implementing that same process across all of our organisation, so we now use it to manage opportunities in supply chain, in drilling and completions, in IT, and even to manage our technology development; One Process One Tool again. The impact has been huge. We've had opportunities coming in from everyone everywhere, from rig teams on well pads in North Dakota, from engineers in Houston, from finance analysts in West Africa, from operators and maintenance technicians in Malaysia and elsewhere. And the process has given our leadership direct line of sight to connect them with the ideas that are coming from the business, so they can see it all one place, we can prioritise locally or for the larger decisions globally, using tools in the system to make sure we get the most bang for our buck.
So, this helps us to make the right decisions on how we can best increase production, mature our resources, reduce costs, and reduce risks. It's about ensuring the ideas are owned, implemented, and shared through people across the organisation. Almost 3,000 opportunities have been generated over the past four years and over 50% of these have been implemented. Obviously, some opportunities are better than others, but I certainly think this is a real demonstration that continuous improvement culture is indeed alive and well in Hess.
Sean Glynn: Well, thank you very much Roddy, and thank you to our listeners. That’s all from us today here at the Process Excellence Network. I'd like to thank Roddy again for joining us, and as always don’t forget that for additional process related resources, including podcasts, articles, webinars, and various other resources, log on to the Process Excellence Network at www.pexnetwork.com. Thank you, and have a good day.