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BRITISH PETROLEUM

One of BP's oil drilling critical success factors is speed to infrastructure setup, in particular, off-shore oil drilling platform installation. BP was shocked to find that some design teams could achieve it in half the time and at dramatically reduced costs. The key was the design teams' organic knowledge management practices.

There are few surprises in oil rig installation. It is a standard, predictable process despite being multi-faceted. All the top petroleum companies have been doing it for decades. Yet to BPs surprise after careful analysis, some design teams do it far more efficiently than others. The evidence over several years in comparative analysis was clear and is summarised in the following diagram depicting real design teams A and B.

BP decided to investigate more closely, calling it the Drilling Learning Project initiative. They investigated the practices of teams like Team A above to determine the secret of their success. 10 key competencies were uncovered. Team A had developed a high standard around these key competencies. The uncovered key competencies for oil rig design and installation are depicted in the next diagram.

Just how BP Team A achieved high levels of competency has not been fully documented as yet. The clue given is the last key competency - Learning Insights. Team A was learning at faster rates about their own business than Team B and confirmed upon follow-up analysis . It can be labelled as a 'KM-Enabled Team' (see following diagram).

Self-generated mechanisms of peer-to-peer learning existed much more in Team A than in Team B. This highlights the principle that proper operational learning cannot be generated passively. Like a good tennis or golf game, it must constantly be worked on. Otherwise there should not have been any major gaps in oil rig construction efficiency between teams.

The challenge was now before senior executives - (i) how to set up knowledge management processes to transfer best practice from high performing teams to modest performing teams; and (ii) how to train modest-performing teams into the competency of team learning - KM enablement.Only with these two elements in place can true best practice transfer happen (see following diagram).

Cost efficiency is one of the petroleum industry's critical success factors. BP has discovered that skilling teams formally in knowledge management practices will produce even more multi-million dollar cost savings and revenue growth. BP is starting to measure the efforts of cross-teams best practice transfer.

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References

Parcell, G. and Collinson, C. (2001) Learning to Fly: Practical Lessons from One of the World's Leading Knowledge Companies (BP). Capstone Publishing.

L. Baird and J. C. Henderson (2001) The Knowledge Engine: How to Create Fast Cycles of Knowledge-to-Performance and Performance-to-Knowledge. Berrett-Koehler Publisher. p.23-35