Sharing Know-how at BP Amoco

Sharing Know-how at BP Amoco • The development focus at this international oil producer rests on a framework for sharing knowledge that starts with a business objective and ends with business results • David C. Barrow

Sharing Know-how • Name for Knowledge Management program at BP • Example.. • About 30 people in a peer group called Group Technology work within a corporately supported unit who provide coordination and guidance to many technology activities of BP business units.

Peer Groups • These peer groups are a distinctive part of the organization. They are relied on as the fundamental unit for managing capital. • Examples….. • Five business units around the world who do on-shore production could form an On-Shore Oil Production peer group. • Two or three convenience store operations may for a peer group.

Role of Peer Groups • Manage capital • Performance reviews • Idea and information sharing • These peer groups do not rely on a corporate functional department to share knowledge which allows the corporate center to focus on policy.

Generating and Sharing Knowledge • Starts with the business objective and ends with business results • The idea is that learning and knowledge transfer must not be an end in itself • Portrays leaning as a cyclical process that takes place around the execution of business plans with separate activities to be taken up before, during and after a project • The idea that business units draw on shared knowledge assets and rely on human networks

Generating and Sharing Knowledge • BP views its members as not only a part of the business units but also support the federal welfare • BP is a complex, mature industrial enterprise with global reach

Connecting People and Forming Networks…. • BP uses a voluntary corporate Yellow Pages system, dubbed Connect • Connect serves as a directory to BP’s knowledge workers and associated networks • Has web-based personal profiles of more than 18,000 knowledge workers and more than 250 networks

Connecting People and Forming Networks…. • Allows individuals to build web pages for themselves in which the describe their skills and experiences and what they have to contribute • Connect is transparent and allows everyone to see what everyone else is doing • Networks in Connect range from 3 to 650 members

What is "Visualization Technology"? HIVE - Highly Immersive Visualization Environment - a floor-to-ceiling, 25 foot wide curved screen with multiple projectors 3D stereo visualization with stereo googles, enabling the examination of a physical system from any angle, "fly-in" for closer look Allows for relative appreciation of the physical challenges (offshore drilling in this example)

Planning Benefits of HIVE • HIVE used to help interpret seismic data, used to estimate the quality and extent of potential oil and gas reservoir prospects • Geoscientists, drilling engineers and drillers all collaborated using the HIVE • After establishing drilling objectives, it was determined that drilling a certain way and reusing parts of the wellbore, multiple objectives could be accomplished from a single surface location

Execution Benefits of HIVE • Company was spending an average of $30 million per well • In one "planning" day, they were able to reduce the number of wells by 2, saving time and money, $60 million in this case • Facilities Engineers - "don't need much of a facility on the surface, we don't have to consider as much steel...“

Overall Benefits of HIVE • Geologists, geophysicists, reservoir engineers, pipeline engineers, drilling and facilities engineers were able to document a savings of more than 10% total development costs • HIVE is being implemented in multiple BP locations • Resulting in a breakthrough that has facilitated better teamwork through the sharing of perspective and know-how, resulting in demonstrable reductions in investment and cycle time

Core Process and Know-How • BP Group Technology focuses on capital efficiency and operational efficiency

Capital Value Process • BP Group Technology promotes stage-gate approach • Organize project activities and control their sequence with decision gates

Steps…. • Appraise, Select, Define, Execute, Operate • Learning before: Connect, peer assist, knowledge bases, network search • Learning during: Enabling systems, after action reviews, networking • Learning after: Peer review, retrospect learning after: Peer review, retrospect

Benefits… • Clarify appropriate timing of resource and material loading for project • Facilitates abandonment of poor performing projects early

Operational Value Process • “Plan, do, check, act” • Assess performance and aspiration against 26 parameters defined • Examples include moral, motivation, communication, reliability • Illustrates where units can share their strengths and improve weaknesses

In Conclusion… • BP has demonstrated value through pilot programs in recent years. • Implementation of these programs throughout BP’s corporate system promises productivity gains of 4 percent per year.

Sharing Know-how at BP Amoco