With the changing landscape of the oil and gas industry, companies are under increasing pressure to improve operational efficiencies as prices continue to remain low and margins are narrowed. In order to reduce costs and improve efficiency, many organizations are adopting a structured quality management system (QMS).
Health & Safety
Due to the hazardous environment that many oil and gas companies operate in, the federal government along with the International Organization for Standardization developed a standard for Process Safety Management procedures and protocols. While this addresses the procedures to prevent major chemical accidents and occupational safety hazards, it is limited in encompassing the operational aspects of the industry.
The goal, is to develop an oil and gas compliance solution that includes industry best practices for all systems such as service quality, risk assessment, employee training, document control, corrective actions and preventive maintenance. A comprehensive solution may seem difficult for our complex industry; however, incorporating common standards of practice is essential to realizing integrated operational excellence.
Clients and Stakeholders
Both clients and stakeholders, are becoming increasingly demanding regarding the standardization and regulations that those companies they do business with must comply with. As an example, many customers are now requiring that their service supply organizations comply with the API Spec Q2 requirement. Using a system designed specifically for this standard streamlines the administration and reporting of said requirements.
A quality management system increases efficiency and collaboration. It ensures compliance and provides metrics reporting to prove such compliance. It defines strategies, goals and best practices and the means to secure them. A good quality management system is, however, only as good as the team behind it. Ensure that policies and procedures are in place that clearly communicate expectations and requirements.
The Bottom Line
Planning and control of critical tasks is required to minimize risks and improve operational efficiency. A comprehensive management solution can connect multiple locations with secure, real-time communications, thus providing instantaneous performance feedback. Furthermore, deployment of an effective quality management system tells your customers that you are at the top of your class and aiming for the best in products and services, ultimately ensuring customer loyalty through operational efficiency
For more information on how Accupoint Software can help you implement a quality management system specific to your needs, please contact us today.
Managing critical suppliers allows you to evaluate your most important sources of products and services. Depending on the size of your company and number of suppliers, you will use either a standard classification or a more complex system. The first step is to classify all of your suppliers based on their weight in your production process. You can place suppliers in one of four categories based on their performance and role. These categories include:
Evaluation of suppliers should be conducted on a yearly basis, at a minimum. You should thoroughly document evaluation criteria including: Price, Performance, Service, Reliability, Quality performance, Risk potential and Complaint information.
Key criteria in choosing critical suppliers relationships include:
The weight of each criterion may vary depending on the product or service. For example, is it more important for the supplier to provide high quality or low price? Is innovation potential more important than process monitoring? Points should be given for each criterion. Once this process in complete you will have a clear overview of your production chain and suppliers. You can then share your evaluation with the suppliers and identify areas where improvements can be made. In addition, the results can be used to strengthen the most important relationships.
An effective supplier relationship management system, will provide digital documentation of all suppliers, data, documentation and evaluations in one place. This is especially useful when working with a large number of suppliers. The system should be standardized and allow for easy access and evaluation.
Critical suppliers are the most important piece of the supply chain. You rely on them for the most crucial parts and services. You must maintain a strong relationship with these suppliers and maintain open communication. In today’s global marketplace competitors can spring up at a moment's notice, challenging product quality and prices. You likely buy components, ingredients and services from all over the world to source quality at the best price. Control of your supply chain allows you to protect your business. Clear documentation, scheduled re-evaluation and the support of managers are necessary for successful supplier management, which will give you a tangible competitive advantage.
For more information on how Accupoint can help you with critical supplier management, contact us today.
Staying ahead in today's global economy often requires companies to make changes. The ability to adapt to change is a crucial part of organizational management. When your company adopts clear methodologies and processes to respond to change you will be set up for success. Organizational buy-in has become a prominent topic of discussion. Due to the team-based structure of most companies, change is often created through influence. Therefore, you need to be skilled in gaining support for your ideas. You need buy-in to implement your revolutionary ideas that move the company forward.
To successfully achieve organizational buy-in, your effort needs to be constructed carefully with attention paid to all of the factors that help a change initiative gain support. While there is not one method that will always work to overcome natural resistance to change, here are four tips that will help you achieve successful organizational buy-in.
Make It Clear
Disciplined thought and honest effort go a long way. When you present reality truthfully, the right decisions become clear. Being honest will also allow your coworkers and employees to trust you. Perhaps the most influential factor in achieving organizational buy-in is committing to open, honest and complete disclosure. To be successful you need to go beyond the data and analysis. A change effort makes the most headway when you appeal to employees' emotions. Using clear, striking examples that appeal to feeling will compel people to want the change. Show what the existing problems are and how this change will resolve them. This will motivate others to act.
Make it Manageable
Presenting a complex, multiyear project can easily make employees and coworkers feel overwhelmed. When you break the project down into steps with clear goals, it will seem more manageable. Consider presenting the larger project as smaller bite-sized phases. This will also make it easier to feel like progress can be made; it will give the change momentum. You can use this method to implement the change in smaller steps in the real world also. Utilizing this technique will help you resolve any potential problems before they become bigger.
Listen to Employees
The relationship with your employees and coworkers is important. You will need their help to achieve buy-in. Your job is to sell everyone on your idea. Explaining your ideas clearly and making it manageable are both ways to strengthen your relationship. Then you need to listen. Address concerns or any interpersonal issues. Your change effort will depend on management's dedication to open dialogue. Remember that listening well can sometimes be even more important than speaking well. Your employees are a valuable source of ideas and support.
Trust the Team
When trying to achieve organizational buy-in, there needs to be strong methods to drive management from the bottom up. You will be implementing change as a team. When change is driven both from the bottom up and top down it creates a strong dynamic and momentum. This means getting both employees and even customers on board. Everyone will come together to harness the force of change and push for success.
Senior management is ultimately responsible for the success of the change effort. Avoid some common faults by paying attention to how much funding is needed, what the required competencies and capabilities are, and what metrics and rewards can be used to support the change. Effective leaders will find the right levers and incentives to reduce resistance and gain momentum for change.
For more information on achieving organizational buy-in, and a variety of other business management solutions for the oil and gas industry, contact us today.
Contract management and review are important, and often neglected disciplines. According to research done by the independent International Association for Contract & Commercial Management, good contract management practices could improve profit by 9% of annual revenue. Contracts can leak, costing money through outdated pricing, or misunderstandings and breakdowns in communication that lead to losses.
Contract review is the process for determining customer requirements prior to the supply of a product, and proof that the organization has the ability to meet the defined requirements. Contract review should be part of your company's business management. Attention must be paid to the requirements related to products, supply and management of information. Your company will determine the specific needs of the customer including delivery and post-delivery activities, such as warranty and maintenance services. You also need to consider requirements that are not explicitly stated by the customer, but are still necessary. You need to know any regulatory requirements that apply to the product.
Before your company commits to a contact or order, or any changes to existing contracts you need to consider several factors including:
Communication is also critical to success. You will need to determine effective means of communication in relation to product information, contracts, order handling, feedback and complaints. This is all part of your customer relations management processes and determining customer requirements. If contract review is ever done offsite, you need to link the activities to your on-site quality management system.
You must conduct risk analysis before committing to a contract. Consider whether taking on additional obligations will affect your supply chain, for example. Manufacturing risk analysis will help you assess your ability to effectively provide the specified product. Do you have the resources needed to fulfill the obligations? Can you meet timing demands? Are there additional developments costs and investments? Look at potential failures in processes, including suppliers. Is there solid potential for increased profits? Considering all of these factors will allow you to enter into contracts that are efficient and effective, which is good for your bottom line.
For more information on how Accupoint can help improve your contact review process, contact us today.
Securing materials and equipment is the first step in the supply chain. A company's competitiveness is directly influenced by the performance of suppliers. A supplier that does not perform well can add costs, cause serious delays and can damage your company's reputation. It is imperative to have a system to evaluate your suppliers. It will help you determine potential problems like low standards of quality, poor communication, and substandard resources. Every company needs to have a supplier evaluation model in place to measure a supplier's ability to comply with their contractual obligations.
Supplier evaluation will identify their strengths and weaknesses. Several criteria should be considered including quality, delivery, service, and flexibility. Generally, the most important factor is quality followed by delivery, service and then flexibility. An effective means of evaluating suppliers is assigning them to one of four categories based on performance: full partner, associate partner, high risk and incapable. A full partner meets or exceeds all expectations. An associate partner needs some work, but performs well overall. A high risk supplier must be carefully evaluated. They can be used for the production currently underway, but future contracts require consideration. An incapable supplier will be dropped as soon as possible as they cannot properly fulfill their obligations.
A full partner must be compatible with you company’s current and future business plan. They will always demonstrate high quality, on-time delivery, superior service and flexibility. The supplier participates in your automatic ordering system. They will provide full support quickly, and be available anytime for questions. A full partner should also assist with new designs and provide samples within one to two weeks. They will demonstrate an ability to develop new processes and be committed to research and development. They will not ship out-of-spec parts, and have well documented quality controls. They will optimize lead times and allow order flexibility within reason. They will show commitment to cost reductions and share their cost structures and pricing models.
An associate partner will meet most of the criteria of a full partner. The associate partner should demonstrate a commitment to improving quality and delivery. You can work with them to develop action plans to meet your goals. The supplier must fulfill the needs of your company. They should be willing to work toward meeting the criteria to become a full partner.
High Risk Partner
A high risk partner is not compatible with the goals of your company. Their current quality and delivery are acceptable to maintain current production, but there is no benefit in expending the resources to bring them to associate or full partner status. The cost and quality are below your company’s acceptable standards.
Incapable suppliers do not meet quality standards. They do not demonstrate the capability of improving quality, delivery, service or flexibility. These suppliers must be dropped immediately.
Evaluating the performance of suppliers using an Analytical Hierarchy Process (AHP) model helps to determine the importance of each criterion and interpret the findings. You will determine what is most important for your company, and use that to rate your suppliers. Supplier can be measured based on the four main criteria: quality, delivery, service and flexibility. To determine the rest of the criterion you should consider whether the attributes are “soft” criteria (like supplier commitment or service) or “hard” quantifiable criteria (like the supplier's ability to fulfill orders). When thinking about cost, consider that the total cost of a product includes all the factors that go into getting your product to market in addition to its initial procurement cost.
For further information on how Accupoint can help your critical supplier management process, contact us today.
Key performance indicators, or KPIs, are a useful to way to determine the effectiveness of your team or company in its efforts to meet performance objectives. When establishing KPIs, it's important to understand exactly what would indicate success for your team, and whether or not it is measurable. Here are four KPI Metrics Measurement Fundamentals to consider.
Is it specific to your team and to your stakeholders?
A useful KPI targets a goal that your team has control over, and an outcome that your stakeholders desire. If you're managing a quality control laboratory, you likely wouldn't want to set a KPI dependent on the overall company's ROI. This is outside of your team's direct control, and it doesn't apply directly to your primary stakeholders.
Instead, ask yourself, what indicates my team is performing successfully, and what do our stakeholders care about. In a quality control laboratory, this might be number of tests run per day, or perhaps target turnaround times for each sample received.
Does it motivate or discourage?
Think of a KPI as a realistic stretch goal, not unrealistic perfection.
Improving customer satisfaction by 3% is likely doable. Requiring turnaround times under 24 hours for a 48 hour test is not.
What you set as a KPI directly impacts your team members and your stakeholders. It's up to you to set realistic, meaningful targets, and to frame it in a way that motivates instead of discourages.
How will the KPI be measured?
A KPI is only useful if there is a system in place to measure it. If you're targeting customer satisfaction, are you already sending out customer surveys? And do you have a baseline number to work from?
Or, if you're interested in setting turnaround times as your KPI, how will this be measured? Is there already a software system in place? Do you, your team, and your customers have a common understanding of what a satisfactory turnaround time would be? What will the dashboard for the KPI look like, and how will results be communicated?
What do you hope to learn or improve by measuring this KPI?
KPIs are not only an opportunity to determine how effective your team is, they're also a way to determine opportunities for improvement and growth. When setting a KPI, ask yourself what might need to change in order to succeed, and what needs to change if you're unsuccessful. These could be things like processes, improvements in communication, or streamlining sample processing. Who will make these changes, and when?
Selecting and measuring effective KPIs is an important way to ensure team success and client satisfaction. Please contact us to find out how we can help you track your targets. We look forward to hearing from you!
Process excellence and quality management systems have the power to transform entire organizations into lean, highly efficient cash flow machines that exceed customer expectations. While quality management systems, including API Spec Q1 or API Spec Q2, comprise different tiers and tools there are common methodologies for monitoring and improving quality within companies. Two common tools include standard operating instructions and quality auditing.
Standard Operating Instructions
Standardizing processes and systems is a critical step in quality assurance and enhancing operational efficiency. After benchmarking a process, the next step is to measure, analyze and improve it, leading to benefits for employees, customers and businesses. Writing a standard operating instruction is part of standardizing a process, so that subject matter experts along with management can analyze and improve it. These written instructions are either detailed or in an outline form, depending on the needs of employees and management.
Product, process and system audits improve the way individuals and teams function within organizations. These audits examine what the ideal process or system is relative to current state operations. This element of a quality management system is also closely tied with corrective action requests, which take a systematic approach to identifying and solving operational deficiencies. Independent audits related to efficiency and effectiveness have the power to drive quality and innovation in functional departments across organizations.
For additional information on quality management systems and the power of process excellence to improve your business, please contact us today. System optimization can take your business to the next level, with the proper planning and professional support.
An internal quality audit is folded into a company’s corrective and preventative practices. The audit takes a snap shot of the organization’s compliance procedures, and then analyzes that snapshot to identify potential problems. In the oil and gas industry, internal audits are an integral part of the quality management system.
To that end we have outlined 5 key steps to ensure that your internal audit process is effective:
Oil and gas concerns are usually multi-state and multi-location enterprises with hundreds, if not thousands of employees. The compliance audits for the oil and gas industries are exhaustive and complex. Effectively managing the audit function will ensure compliance to customer requirements, as well as related regulations and standards. For more information on how Accupoint Software can help improve your internal audit process, please contact us.
Whether prepping for an audit, updating your company processes with new best practice information, or simply checking up on employee training, gage calibration (or lack thereof) should be taken seriously. Lack of compliance, regardless of which standards is being applied, can bankrupt a company. Gage calibration best practices really consist of 2 main parts, which should be checked periodically:
Of course, keeping on top of gage calibration can be tedious, and easily lost among other, more pressing issues. Having one system set in place that can handle all compliance management efforts streamlines the process and makes it easier for the whole company, as otherwise compliance efforts get split among different individuals and departments. This inevitably leads to something getting lost in translation, or through the cracks. For the best compliance management solutions that optimize your business practices while improving customer satisfaction, contact us today.
Depending on the industry under discussion, there are varying levels of incidents that can occur which make having an effective incident management plan a necessity. The petroleum industry most certainly falls into the category of operations where establishing and consistently maintaining an effective incident management response is of paramount importance. Understanding that there is no way to completely prevent incidents -- only to successfully and completely prepare for them when they do occur -- is often the difference between a brief interruption in operations and a long-lasting, expensive situation that negatively impacts a firm's reputation. Read on as we outline four basic steps in any solid effective incident management plan.
Develop a communication plan
This pertains to internal and external communication. Internally, the specifics of the plan are dependent on different factors unique to your organization (size, location, company culture), but whatever form the communication plan takes, it should be well-defined and able to be acted upon immediately. All internal employees should refer questions to your company spokesperson, with no exceptions.
Externally, an honest assessment with a realistic timeline is the best course of action. Ensuring stakeholders and the public in general that you are taking every step necessary to deal with the incident in the timeliest manner possible is vital at this point.
Understand how to classify (and respond to) the incident
At this juncture, the severity of the incident is quantified. Will it affect operations in just one location, or at multiple company locations? Obviously this step will no doubt be drastically different depending upon the circumstances, but the key here is to understand what threats can result from the incident, and gauge the response accordingly.
Formulate a basic framework for costs
There's no question that any incident needs a successful resolution. However, a cost analysis is necessary to ensure that the response and recovery to the incident are not out of proportion to the severity of the situation. As with any business decision, a budget helps immensely for this step.
Ensure your team is complete
Probably the most important step in any effective incident management plan, having the right people in the right places is of utmost importance. The key here is to have a clearly defined plan of action, where all the members of the incident management team understand their role -- without any ambiguity -- and are ready to jump into action immediately.
Developing an effective incident management response is certainly an important consideration, especially for companies operating in the petroleum industry. As is the case with any successful concept, ample planning will ensure that your organization is ready to respond -- and act quickly -- should an unexpected incident occur.
If you have any questions about developing or maintaining your incident management plan, please don't hesitate to reach out to us -- there's a reason why our compliance management solutions are so highly touted!