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AccentureOperationalExcellenceForOil&GasCalgary_Final
The document discusses how leading companies are achieving execution excellence across their hydrocarbon value chains. It identifies 7 key dimensions that successful companies focus on: strategy deployment, value chain convergence, technology enablement, operational readiness, operational excellence, commercial excellence, and organizational effectiveness. Addressing these areas can deliver significant business benefits like increased output, lower costs, higher margins, and reduced risk. The document provides examples of initiatives and practices within each dimension that leading companies employ to break out of cycles of poor execution and complex challenges and drive better business performance.
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AccentureOperationalExcellenceForOil&GasCalgary_Final
- 1. June 3, 2014 HydrocarbonValue Chain Optimization What Leading Companies Are Getting Right “Execution Excellence”
- 2. 2 What keeps thec-suite awake at night? Stakeholder demands Return on assets Complexity CEO CFO COO Copyright © 2014 Accenture All rights reserved.
- 3. Increased Internal & External Complexity Poor Execution Loss of Control Poor Business Results Reactive andPoor Decisions Vicious Cycle 3 Increasing business challenges and complexity Leading companies break out of the vicious cycle with effective execution excellence Copyright © 2014 Accenture All rights reserved.
- 4. 4 7 key dimensionsleading companies are getting right Value chain execution excellence Technology enablement Operational readiness Operational excellence Commercial excellence Organizational effectiveness Strategy deployment Strategic challenges CEO Financial challenges CFO Operational challenges COO p Business performance management Copyright © 2014 Accenture All rights reserved.
- 5. 5 Strategy deployment • Establishtrue north – WHY? • Define strategic clear goals and objectives • Alignment top to bottom • Limited organizational boundaries and bureaucratic constraints • Execute strategy more consistently and reliably than competition Without strategy, execution is aimless Without execution, strategy is useless = Copyright © 2014 Accenture All rights reserved.
- 6. 6 Value chain convergence •Move toward a more data driven and efficient organization • Leverage business intelligence and data visualization • Efficient and effective flow of physical goods and information • Flexibility to quickly adopt and adapt to changes in the business environment • Customize solutions for different segments of customers and requirements Digitalization is converging traditional value chains Financial supply chain Physical supply chain Information value chain Talent Supply chain Social media Mobility Analytics / big data Cloud Value chain Digital technologies Business Digital supply network Copyright © 2014 Accenture All rights reserved.
- 7. 7 Technology enablement • Connected,collaborative, contextual and capable • Revolutionize how data is acquired and processed • Visualization of entire value chain—end to end • Intelligent analytics and information • Improved speed, quality and effectiveness of decision making Every business is a digital business Analytics/ big dataCloud Data velocity Mobile Digital well & plant Digital pipeline Copyright © 2014 Accenture All rights reserved.
- 8. 8 Operational readiness • Effectiveand efficient portfolio and project management • Synchronized concept-to-production value chain • Robust integrated activity planning and scheduling (IAP) • Accurate forecasting, demand, cost, material, logistics and resource planning • Complete data and technology systems integration Efficient workflow Effective portfolio and project time to value and capital efficiency Integrated activity planning and scheduling Digitally enabled Integrated planning and schedule “What if” scenario planning Proactive materials and management Production and financial forecasting Cost controls Copyright © 2014 Accenture All rights reserved.
- 9. Asset lifecycle management •Integrated handover plan • Effective asset data handover and integrity • Documented key work flows to manage production • Complete operational playbooks and training • Integration of project and manufacturing technology systems Effectively bridging the transition from readiness to excellence Pre- Development Development Production Maturity Operational Readiness Operational Excellence Lifecycle Management Time ProductionRate X Copyright © 2014 Accenture All rights reserved. 9
- 10. 10 Operational excellence • Stateof alignment for achieving business and operational strategies • Holistic framework approach to business improvement • Focused, simplified and constantly attacking complexity • Corporate culture committed to continuous improvement • Achieved by design and not by coincidence • Sustained with the right attitude, the right mindset and the right competencies Strengthen economic and competitive position of the business Reducing cycle-time for project delivery Reducing production and process losses Reducing variation in production Sustainably lowering unit costs Maximizing value delivered from portfolio Effectively managing production decline Digitally enabled Copyright © 2014 Accenture All rights reserved.
- 11. 11 Integrated operations • Fullvalue chain visibility • Relocation of staff from remote sites • Coordination, collaboration and decision making • Technology enabled • Talent recruitment and retention • Health and safety risk reduction Resources and information enabling operational excellence Digitally enabled Real-time process visualization Key performance Indicators and dashboards Collaboration Copyright © 2014 Accenture All rights reserved. Integrated operations‘ center Predictive analytics Condition assessment
- 12. 12 Asset optimization • Overallstrategic and operational risk framework • Advanced monitoring and prediction of asset performance • Seamless connection of asset performance to maintenance execution • Proactively managing supply chain and resources • Integrated technology systems with quality data Holistic approach to strategic asset optimization aligned to business objectives Digitally enabled Asset data quality & management, integration, CMMS / EAM systems MRO sourcing and procurement, network inventory optimization MRO inventory management and movement Maintenance execution planning, scheduling T/A, mgmt. systems and KPI reporting Asset / reliability / maintenance strategy Predictive analytics PM/PDM/CBM routines Critical equipment strategies, operational risk Asset benchmarking Copyright © 2014 Accenture All rights reserved.
- 13. 13 Commercial excellence • End-to-endsales and operations planning and execution • Near real-time scenario generation and access to operational information • Full value chain financial, physical asset and inventory visibility • Increased responsiveness to the market, internal and external customers • Integration of applications, systems and refinery optimization models Closing the gap between planned and actual performance to improve margins Digitally enabled Copyright © 2014 Accenture All rights reserved.
- 14. 14 Organizational effectiveness • Strongand visible leadership with deep workforce engagement • Right technical, functional skills and capabilities with effective knowledge transfer and management • Effective contingent labor management • Sharing of best practices • Corporate culture committed to continuous and deliberate improvement of company performance. When leaders don’t lead, Followers won’t follow Copyright © 2014 Accenture All rights reserved.
- 15. 15 Business performance management •Insights and information • Visibility of performance • Manage by exception • Increased accountability • Closed loop management system High performing organization Alignment Near real–time data collection (asset, production) Automatic filtering and data quality improvement Merge of data from multiple sources Transform data into insights Visualize the Right info to the Right people Right time Digitally enabled Asset and program metrics Corporate metrics Individual score cards Copyright © 2014 Accenture All rights reserved.
- 16. 16 Key value driversand typical results achieved Operating margin Output Pre-tax ROIC Business benefits Illustrative Effectively addressing key value chain elements can deliver significant benefits Costs Capital employed Risk management Key levers Range of typical impact • Availability • Reliability • Throughput • Product yield • Operating expenses • Catalysts/chemicals • Energy costs • Productivity • Working capital • On-time/on-budget projects • CAPEX optimization • Cash management • Process/personal safety • Standardization • Environment protection • Asset integrity As low as reasonable practical % Average throughput improvement 0% 8% 4% % Average unit cost reduction 0% 15% 7% % Average capital employed reduction 0% 6% 3% Level of operating risk Copyright © 2014 Accenture All rights reserved.
- 17. 17 Final remarks “Perfection isnot attainable, but if we chase perfection we can catch excellence.” Vince Lombardi (USA NFL Football Coach) Copyright © 2014 Accenture All rights reserved.