Operational Efficiency

Transcription

1 Operational Efficiency January 015 Transform to the power of digital

2 E&P value is squeezed under both a decreasing top line and growing costs Prices decrease drastically Operating costs keep rising Brent prices have been divided by since April 011 Prices have particularly collapsed in the last 6 months Operating costs in E&P have increased by 17% since 011 In the long run, since 000, they have even doubled Brent price Upstream Operating Cost Index Cost Index (000=100) 10 Brent ($) Source : La Tribune, Source : CERA-IHS, 015 Operational efficiency has to be improved Copyright 01 Capgemini Consulting. All rights reserved.

3 CapgeminiConsulting has structured offerings to tackle Operational efficiency issues for E&P Companies Operational Excellence in E&P Companies OBJECTIVES OBJECTIVES OBJECTIVES Ensure ZERO HSEIncidents Maximize OEE to increase production output 1 Integrated Planning & Supply Chain Optimize Cost Management OBJECTIVES Attract, develop & retain Human Capital Field Automation & Production Monitoring OEE& Advanced Analytics Performancebased Contract Management Project & Project Portfolio Management Leadership programme Agile Information System Efficient organization & governance Sensor & SCADA System Structured Company-wide Data Model Ensure right peopleat the right place Copyright 01 Capgemini Consulting. All rights reserved.

4 Increase production output Highlights on the leakages from hypothetical potential to production delivery 1 CONSTRAINTS CAPACITY LOADING PERFORMANCE AVAILABILITY RELIABILITY Budget process Production delivery 4

5 Integrated Planning & Supply Chain Capgemini Consulting accompany its clients on all industrial performance topics Supply Chain Planning & Transformation Production Logistics Identification and analysis of improvement opportunities Performance plans design: efficient, accurate, suitable and integrated to the activities of a supply chain Evolution and implementation of new operation models Productivity and flexibility: World Class Manufacturing (sharing the best practices between locations) Industrial quality: production organization and quality, 6 Sigma, quality tools Industrial organization and management Flows tracking: SCEM, Traceability, RFID, order management Flows optimization: Lean manufacturing, CPP, JAT, Hoshin, Takt time, Takt Designs, Kanban Forecasting / Planning / Scheduling Storage and transportation analysis: warehouse productivity, logistics outsourcing, transportation plan, route optimization, WMS and TMS softwares, logistical practices benchmark Focus on physical storage and ware flows to improve information flows linked to these activities Lean Use of our exclusive BeLean approach to improve the efficiency of processes and operations Action on 4 levers: processes, management, capabilities and behaviors Lean Management principles application to a widespread logistical chain, implying suppliers, in order to reduce supply costs and to benefit from their productivity improvement Lean methods can lead up to 0% productivity gain on some core business processes Through these programs, experience shows cost optimization by 5-15% and significant improvement of the service level Copyright 01 Capgemini Consulting. All rights reserved. 5

6 Reduce purchasing costs Standard cost-reduction opportunities for contracts 1 BUY CHEAPER Leveraging new suppliers (widening of the suppliers base, taking advantage of market opportunities ) Installing a cost-conscious approach: evaluation of the target price (unit cost), its variance across identical contracts, renegotiation rate of prices, gap assessment, currency fluctuations simulation Volumes concentration: rationalization of the number of providers (identification of top 10 core suppliers, sharing suppliers across multiple BUs ), grouping / pooling of contracts to create synergies (by category, by supplier, by region ) BUY DIFFERENTLY Improvement of product specifications(modification of conditions/constraints in proposal requests, evaluation of the expected added-value or opportunity cost of a product, purchasing systems rather than single articles ) Orientation of contracts towards performance and results rather than target means Development of long-term partnerships with providers to install a collaborativecost-out objective (suppliers implication in the design phase, implementation of shared processes to generate productivity gains, logistics integration ) BUY LESS Redefinition of consumption standards: processes reassessment, evaluation and prioritization of the portfolio of contracts ( nice to have vs. must have ) Comparison of the make or buy strategies Forecasts improvement (forecasts quality, forecasts frequency, consolidation through functions ) 4 STEER & PLAN Steering and control of equipments/services throughout delivery to ensure contractual agreements are met (supplier relationship management) Commitment to cost of ownership and accountability by business units and not only procurement teams Copyright 01 Capgemini Consulting. All rights reserved. 6

7 Appendix

8 Reduce purchasing costs IS/IT component: standard cost-reduction opportunities for Information Services contracts Technical Assistance (Application Development / Application Maintenance) & Infrastructure Management 1 MASSIFICATION Rationalization of the number of service providers (identification of top 10 core suppliers, sharing suppliers across multiple business unit, ) Grouping / pooling of service contracts to create synergies (by type of service, by supplier, by region ) Use of volume effects to negotiate better conditions INDUSTRIALISATION Implementation of Services Centers/Factories dedicated to technologies, or specific application portfolios Implementation of processes and tools to better monitor SLAs, quality and productivity Contracts based onprice per work units and SLAs RIGHTSHORING Use of labor costs arbitrage according to feasibility (language, culture, need for proximity, resources pooling ) Roadmap adapted to needs with mix of onshore/offshore capabilities 4 NEW MODELS Multi Service integration: managing end user SLAs by reconciliating multi or single towers contracts and streamlining governance and piloting efforts and resources(cf. framework slide #17) Cloud services (IaaS; PaaS; SaaS): flexibility of as a service models and mutualisationof private/public/hybrid cloud resources to reach cost reduction effects Service Orchestration: managing services from multi sources (Apps Store; Legacy; Private/Public Cloud) Copyright 01 Capgemini Consulting. All rights reserved. 8