Case Study

An oil and gas company saves $75 million by building a management control system

April 19, 2021

Authors

Dhruv Sanexa Jaison

$75mil

Overall cost savings

300

Change champions trained

20%

Reduced spending on operations drilling materials


 

An oil and gas drilling company* in the United States engaged us to uncover why rig manager workloads had increased dramatically. We soon discovered that the company lacked a systematic MCS that enabled them to monitor remote sites adequately and funnel issues through the districts in a timely fashion.

The Challenge

The company had about half a dozen operating districts within the country. Each district Vice President ran it based on what he or she valued and wanted.

This caused several problems:

  • The company essentially had half a dozen different companies within it, all pulling in different directions trying to reach different goals.
  • Districts were not aligned or unified to a single purpose. With each district having different KPIs, the company was not working towards the same goal.
  • Higher costs to onboard employees. As employees shifted from di strict to district, they had to take in new operating systems, structures and information.
  • Uneven distribution of resources. Districts that screamed the l oudest received the most resources.
  • Confused customers would say that district to district, “You don’t even seem like the same company.”

The Solution

For four years, we went department by department, district by district to build and install a standard MCS. With a consistent MCS built, we were able to improve the work and efficiency of rig-based management and operations.

Besides building a process for real-time monitoring, we also created a digital enterprise dashboard which allowed managers to get a quick overview of how the company was operating. Managers were now able to monitor how superintendents were managing the rigs and if they were managing their cost appropriately. This enabled the company to make faster decisions and move much quicker than their competitors.

The Results

The company was able to reduce rig-based injury risk significantly. Spending on drilling operations materials and supplies went down by over 20%.

Overall, the company saved over $75 million.

Also, 300 employees were trained to be “change champions”. This effectively installed a culture of continuous improvement in the company.

At the end of four years, the company experienced a complete cultural overhaul – they now have a culture that is efficient, data-driven, and intentionally managed. This positioned them to effectively respond to the rapidly changing nature of the oil and gas industry.

* We take client confidentiality seriously. While we have kept the brand anonymous, the results are real.

What the client said:

“Renoir assisted us in establishing consistency and transparency in our processes as well as identifying processes that were of little or no value to us.”  

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