The automation of data collection at the rig and the addition of business intelligence tools turn data into information, providing valuable trending indicators for decision support. Business processes are streamlined as the data is directed into mission critical and existing enterprise systems through tailored integration.

These are challenging times with increased activity; shortage of experienced personnel; and increasing environmental, financial, and safety regulations. Technology advancements that provide automation of previously manual operations like automatic pipe handling equipment help address these needs by improving operational efficiencies and reducing safety risk. Additionally, the automation of data collection and the addition of business intelligence tools turn data into information, provide valuable trending indicators, and deliver direct integration into existing enterprise systems, which is pivotal in meeting these new challenges.

Within today’s digital oil field, innovative electronic practices have emerged to redefine how rig and office administration works. A key benefit of this new automated business integration paradigm is that more contractors are now making critical decisions based on real-time information — instead of on anecdotal information, “backhanded” data, or perceptions — to deliver greatly improved business results. Data-driven decisions, streamlined processes and accurate and timely collection of information are paramount as contractors strive to enhance their business results.

Contractors are looking at the data-driven environment for ways to heighten operational excellence, reduce non-productive time, and make better decisions. Contractors typically focus on desired business results. First, they need enhanced business intelligence on which to base decisions. Second, they need to be able to capture trending information to quickly take action that improves operations and reduces costs and risks. Finally, in addressing what contractors expect regarding business results delivered through automation is an improved audit trail helping reduce compliance risk. With electronic business rules applied to capturing information and electronic signatures, accurate and consistent information can travel through contractors’ business systems without requiring re-keying or recreating information while capturing the complete audit trail.

Business intelligence automation

By streamlining the process, the efficiencies and accuracies are increased, cycle times are reduced, and this instant access to information lets contractors take proactive action instead of defensively reacting to negative developments. Additionally, by streamlining business processes, customers can increase their activity without increasing worker headcount.

With the automation of the International Association of Drilling Contractors (IADC) Tour Sheet over the last few years, this is now possible. Automation of the IADC Tour Sheet is of strategic importance to drilling contractors worldwide as it is the worldwide standard for reporting daily operations at the rig and is used as the legal document between contractor and operator for each day’s work. Data captured on the IADC Tour Sheet includes operational activity and equipment, billable and non billable rig hours, crew complement and payroll, job safety analysis, and safety incident reporting.

Few aspects of drilling are more important than efficiencies and time savings at the rig itself. Driving home that point is how automation revolutionizes the entire business intelligence process. If a 10-rig contractor, for example, opts for automating a suite of reports — for example, payroll, human resources, or safety — they can shift more than 5,000 hours of rig management toward better safety, drilling, training, and enhanced service. This automation, however, must focus on creating a single source of entry for each data item and be intuitive and simple. Otherwise it will not be accepted by rig personnel or provide the desired benefits. On the office side, clean, consistent, accurate data fed directly into enterprise business systems have a decided dual impact: reduction in time and effort and reduction in compliance risk.

If automation does not immediately appear to be a must-have technology, contractors need only to remind themselves of what manual processes involve. “Pain points” include faxing Excel spreadsheets, tracking, cost management, effective personnel management, eliminating safety exposures, and minimizing downtime. All prevent the offering of complete service to their customers.

Payroll

Payroll processing has historically been highly labor-intensive. Within this process, hand-keying data from the IADC report into the payroll system offers many opportunities for errors. As a result, businesses have recognized they need a payroll process that reduces processing time while improving accuracy (by removing redundant key entry). This results in higher employee morale and lower employee turnover along with more efficient, safer operations and reduced risk and cost of Sarbanes-Oxley compliance. Improved business results therefore translate into higher revenue and profits, improved service image, and share.

Most importantly, the automated process begins with “clean” eligible employee data sent directly from payroll system to rig. Then, through the automated solution, with business logic built in, businesses can configure their specific business rules and logic, can e-mail alerts to notify the office the same day that a new employee (not in system yet) goes to work on a rig. Payroll accounts not meeting business rules are flagged, operational costs can be reduced by pinpointing problem areas with data analysis tools, and time sheet review and edits with full audit trail can be performed. At the press of a button the reviewed/approved payroll can be exported into the company’s enterprise resource system.

Human resources

“Pain points” at companies still using manual forms as part of their human resources (HR) system are primarily tied to trying to stay current with critical information. This is because data may never get faxed, may be lost in the mail or not all key information is filled in. Individuals who should be terminated may actually not be terminated and continue receiving benefits.

In fact, whether hiring, firing, or promoting, getting the proper documentation in the right place in the office has typically been a serious problem. Usually it begins with handwriting a form, getting a signature, faxing to the office, all a tedious manual process. Overall, variations of the above can result in overpayment or underpayment and incorrect promotion information. In contrast, through automating the process, logic built into HR forms is event-driven, with the end result being that cycle time for processing is greatly reduced for personnel action request forms, terminations, W4s, and employee reprimands.

Safety

Regardless of a company’s focus on such key areas as profits and productivity, safety is the foundation of an efficient drilling operation. While even one safety incident is too many, incidents do take place and result in injury, lost revenue, and increased administrative costs. This could possibly be anticipated and prevented. What has been needed for decades is: 1) the ability to document and track safety reviews; 2) analysis performed, specific incident management, and documentation for legal case support; and 3) analysis tools for trending and prevention. Timing is exponentially more important with safety than any other issue, so quick and accurate electronic reporting is vital.
While incident prevention is by far the primary concern, of secondary concern is opportunities lost due to the inability to quickly access incident information. Current manual or spreadsheet reporting processes make it difficult to harness opportunities to market rigs with exceptional safety records to maximize fleet utilization and revenue. Tighter safety management in a contractor’s operation can result in a more marketable operation as operators strive to avoid risk.

Conclusion

In today’s oil and gas industry, contractors face major competitive challenges. At the root of meeting these challenges is meaningful business intelligence delivered in real time to make timely, critical decisions.

Yet too many companies remain stymied by manual processes that make trend analyses slow and reactive at best. This can be changed to proactive, efficient, and well-managed business by exploiting seamless, professional business integration systems focused and equipped to perform diagnostics, analysis, and trending critical business parameters. In other words, the electronic system supports organizational goals, problems, and needs, and then translates those into business integration solutions delivering intelligence and driving business results. Contractors can then make more informed decisions, discern problem areas quickly, reduce operating costs, and improve overall performance. Operators get more efficient wells, lower risk, and better service, and the industry gets satisfied shareholders.