Blog Post What Do You Mean By Lean Thinking For Oil and Gas Industry?

What Do You Mean By Lean Thinking For Oil and Gas Industry?
Sep

11

2014

What Do You Mean By Lean Thinking For Oil and Gas Industry?

Lean Technique is being used in the production sector of almost all the industries for quite some time now. However, this professes a boon specifically to the Oil and Gas sector. With measured steps, implementing a proper working atmosphere and conditioning the work culture, revolution can be brought to the Oil and Gas Industry.

Lean is a principle, a way of thinking that is implemented in many industries, specifically in the Oil and Gas Industry, in the E&P (exploration and production) sector. The lean technique is a waste reduction methodology that is used by every kind of profitable and even non-profitable industries to increase their profits. To those who do not know much about this technique and its uses in the Oil and Gas industry, here is a brief overview of the same—

oil-and-gas

1. What is the Lean Principle?

Adopted from the Toyota Production System, Lean is a generic management technique that is specifically implemented to cut down on the waste generation in a company, thereby increasing the profit margin. It works by uprooting 7 of the most unprofitable activities that reside in the heart of every organization—defects, transportation costs, overproduction, inventory, waiting, processing and motion.

2. How Does It Work In The Oil And Gas Industry?

Owing to the excessive competition and cost pressure, Lean methodology is being slowly implemented in the Oil and Gas industry though numerous companies are still wondering about its implementation for the fear of losing out their flexibility. However, after much experimentation, it has been found that the lean principle could actually work to standardize and improve all the “processes” that occur simultaneously at the Oil and Gas industry. Lean does not only help to standardize the repetitive processes such as well drilling, but also the one-off processes like the Greenfield development or the capital investments.

3. Has It Helped In Implementing Any Real Cultural Change, Thereby Revolutionizing Its Production?

Firstly, culture is not something that can be turned upside down in a single day. However, since sustainable lean performance is more about the workers and their performance other than anything else, after engaging in proper behavioral norms and organizational skills, such a revolution is indeed possible. In the Oil and Gas industry, where outdoor work activities matter a great deal, implementing such rules and a proper workable environment can instill more rigor into the workers, hence increasing the total output of the industry.

4. How Can Bring About Great Bottom-Line Benefits Through Lean?

According to this principle, if someone wants to bring a real change in the company, one has to plan everything properly keeping in mind the work force, the cost, the working condition, the capital, etc. The steps to success have to be measured perfectly, measuring the profits and successes along its way. One must also emphasize on the Value Velocity owing to which one can get fruitful results right in the beginning. However, in order for the prosperous growth of the industry, the momentum has to be kept up. In short, proper focus and a right attitude to work (both by the senior managers and the works men) can bring a revolution to the Oil and Gas Industry.

Comments are closed.