3 Reasons Why Data Management Should Be Strategic Rather Than Tactical

Global Business Communication

During the 18th International Conference on Petroleum Data Integration, Information and Data Management (commonly known as the “PNEC” conference) on May 20-22, 2014, there was a session in the first day dedicated to the topic of professional data management. During the panel discussion, an attendee asked the following question: Why do we even need a professional role dedicated to managing data, since data service is a supportive role to various operations?

Trudy Curtis, CEO of PPDM Association, answered this by emphasizing that data management (especially data content management) should not be viewed as a tactical function, but a strategic one, needing lots of focus and planning to help businesses truly benefit from the potential of strong, quality data.

Many businesses indeed do not view data management as a strategic function. Below, I will give three reasons why data management deserves to be a key strategic function within any modern digital business.

Data is the blood of modern business workflow

When considering business processes, or workflows, of a business, many would consider them comprising mainly operation procedures. For many of these workflows, the role of data is supportive (i.e. they are the inputs and artifacts of the workflow, but the data itself would not alter how the workflow is run). Enter the digital age, though, and you suddenly have important workflows that cannot run without putting data management into a much more strategic, proactive role.

Suppose that an upstream company manages leases where, upon a certain level of production from the wells of the land, division of interest changes. For example, when the company produces X barrels of crude oil, a particular division of interest doubles (while proportionally shrinking interests of other entities). The data about the leases and the data of production accounting are stored in separate places. In this case, two challenges would occur:

  • If the production level data is not accurate (data quality issue), it may trigger the change of division of interest at the wrong level, or not trigger at the right level. This will bring losses to the company, and/or damage relationships with customers.
  • If the production level data is not accessible from the lease management department (data accessibility), then the whole workflow completely relies on someone at the accounting department to notify the land department in order to make the necessary change. Not only is this cumbersome, but the probability of missing the change notice is very high.

As you can see, today’s workflows are increasingly dependent upon data quality, accessibility, governance, etc. to ensure the execution quality of the process. To minimize negative impact due to data issues, data management needs to be done at a strategic level, so that it can plan forward and ensure that all processes in the company are well supported by the needed data. If there is no plan, when you need it, it will not be there.

Unplanned data cannot give meaningful information

One wave that the industry is catching on is Business Intelligence (BI). By utilizing data integration, dashboard, data warehouse, etc., it provides a powerful platform to generate useful information, helping the business line to make better decisions. There is, though, not enough discussion about the underlying requirement: data quality.

Simply put, the data needs to be a certain quality to support BI objectives. One common challenge is that in order to do a useful rollup of a certain dataset, there will be certain required data often not captured. BI projects rely on well-captured data to be successful and useful; if the data has not been captured, a BI project will not miraculously fix this problem.

As the saying goes: “garbage in, garbage out.” BI projects also rely on data that is in good quality, with accurate and precise data to do correct rollups, so that it can provide adequate and realistic information. In fact, the most costly portion of many BI projects is data cleansing, which is required to make the projects successful.

If the data has already been managed strategically, ensuring certain quality, governance and availability, projects and operations that rely on this data will be much more cost efficient and successful.

Data maturity needs to grow with the business itself

Many people talk about data growth in terms of volume. Data volume is certainly a key factor, but it would be unwise to overlook the fact that data maturity needs to grow with the business itself as well. It will not magically catch up with the business, and ignoring it in the business roadmap can lead to negative impacts.

Realistically speaking, setting up a mature data model and strategy is costly and time-consuming. For small businesses, they need quick wins to maintain positive cash flow; therefore, most small businesses could not afford high data maturity, and “getting the job done” is what they focus on.

As the organization grows, though, the data has to become more mature with the organization. Since the business requirement will expand, or even become different, when the organization grows, the original data model, quality, governance, etc. will not be able to support the growing operations.

Projects to improve data quality, set up governance, ensure accessibility, etc. are expensive and time-consuming, therefore these data improvement projects need to be planned ahead, in accordance with the organization’s roadmap.

Moving forward

Just like IT, data management used to be viewed under the spotlight of a supportive, tactical function. However, in this new digital age, data management deserves better management. Align data management with your company strategy roadmap, and your organization will have a head start to quality data, ensuring operation efficiency and cost savings in the long run.

The Importance of Aligning Business Units and IT Department

During the PNEC conference on May 20-22, 2014, there were multiple presentations showcasing their various level of success in IT and data management projects. One key theme that kept appearing was the topic of “aligning business units with IT departments” for a joint effort of implementation. However, for most of the presentations, there was no further explanation of how to make this happen.

This is an epidemic among multiple industries, but it is particularly severe in the energy space. For many organizations, IT departments work in silos, and business units do not know how to manage them.

The traditional role of IT department

Even though technology has evolved tremendously since its inception into corporation, the way of managing IT departments has not changed significantly. In many organizations, the main responsibility of the IT department is to support various operations, and the role of IT is usually tactical, not strategic.

These IT departments are usually a monolithic structure. By and large, the IT department is usually a distinctive sub-organization within a corporation. With this organizational structure, IT usually operates in a silo, and out of sync with the organization’s development. While IT needs to support multiple business units, it does not blend well with any one of them, since it needs special purpose and required talents.

As business units normally do not have a solid understanding of how IT works, the IT department is usually a mystery to the whole corporation. Operating under the impression of a black box (even worse if any part, or the whole set, of IT functions is outsourced), there is no measurement of how aligned the IT department is to the whole business, as long as the bare minimum of digital functions seem to work for the most part.

There are many articles on the internet talking about how to manage IT departments in new ways, for example decentralizing the monolithic IT department into smaller units, spread into different cross-functional teams. This may be an enormous task to many big corporations. However, we can look at managing IT projects better by discerning their different purposes and functions.

Organize IT Projects by different purposes

There is definitely no single way to categorize IT projects. Here, I would try to put IT projects under four categories by purpose, for better clarify and ease of management:

Digital Fabric: the infrastructure

This is the backbone of every IT project and all digital capabilities. These types of projects include everything from hardware to networking to server software to technology toolkits. Their main goal is to provide the organization with the best capability for developing its digital assets. The talents championing in this area are not necessarily good at facing end users; rather, they need the best technical excellence to ensure a robust system that is easy for other development teams to develop upon in a development-friendly manner, and with the best availability (uptime).

Common Services: cost- and operation-efficiency focus

IT departments have an inherit function to support the end users in various ways. Many of them are quite commonplace; they are about ensuring operation efficiency, reducing cost, and giving users (internal and external) non-invasive ways to continue their day-to-day operations. Implementing file-sharing services and shopping carts are some of the examples. Talents under this area excel in focusing on what the users want, user interface design, and serviceability.

Enterprise Solutions: extension of business capabilities

The truly interesting IT projects are usually not those focusing on cost reduction; instead, the most interesting IT projects belong to this category. The end goal for these enterprise projects is to extend and expand the company’s capability, in order to generate revenue and to gain competitive advantage. Enterprise software projects, custom application developments, master data management, etc. are all under this category. These are also the types of projects that get deeply embedded into business processes; once implemented, the solution would greatly enhance the process’s capability to achieve goals that are much more efficient and capable than pure human resources. The cost, however, is that once these solutions are so embedded into processes, they are not easily swappable; and the project duration tends to be longer. That’s why these projects need to be championed by someone who excels in both the technical expertise, as well as the specific business operations, such as business analysts. Enterprise solution projects require the most strategic attention in planning and resource management.

Analytics: the cutting-edge insights and researches

These projects help business make better decisions. Information and insights are the keys. Business Intelligence (BI) is one example. These types of projects are usually quite cutting-edge, experimenting and discovering new ways of looking at data and information to help business gain new insights, make better decisions, and discover new revenues. People who excel in this category are fearless and enthusiastic innovators.

 

How to align business unit and IT departments

As the above shows, even though traditional IT departments are monolithic organizations, they actually handle various types of projects that have different goals, and require different kinds of talents. One of the biggest hurdles for business units dealing with IT projects is about the wrong project-talent match: the project may be about cost reduction, and IT professionals who are more enthusiastic about innovation may find it boring. Another hurdle is that business units typically manage custom solution projects in the way of common service, not realizing the timeline, resource and strategic attention the project requires.

Entrance has extensive experience in custom solution development and BI projects. We have a proven track record of implementing solutions that extend business capabilities of clients to unprecedented levels, unlocking competitive advantage and preparing for the organization’s next wave of growth. We understand how to tie solutions to business processes for optimal efficiencies, as well as helping business owners make the best decisions with our BI expertise.

Data Management & Technology: Secret to Oil & Gas Growth

Data Management the Key for Unconventional Success

Data management  and new technology is lowering the risk level for unconventional oil and gas E&P. This has become apparent in recent years and is a radical change from former risk levels of investment.

Computational analysis is at the heart of risk reduction and the ease with which entrepreneurs in this field are now finding funds. is more important than ever before.

Technology drives analytics for better governance, risk, and compliance (GRC) applications. The amount of Oil and Gas information is rapidly increasing.

At the same time mobility, cloud, and Big Data analytics offer opportunities to effectively harness the way information is managed, used, and distributed enterprise wide.

Entrepreneurial Gains

Mitigating risk in oil and gas operations at any part of the cycle from upstream, midstream, and to downstream ultimately leads to entrepreneurial gains.

Data Management for Oil and Gas: MobileEnterprise wide management of information and intelligence drives success. Consistent, contextualized, and integrated information that is available immediately and on-the-go is required to support most operations.

Collaboration tools are also necessary for communication both within an enterprise and between enterprises, because expertise is required across the globe.

The complexity of drilling and other oil and gas operations is such that the ability for engineering, design and applications experts to work together is essential.

Teams rely on high-end 3D visualization and collaboration rooms that allow members anywhere to access the same data, models, and tools.

Aside from the need to bring in experts from many areas, including field services, seismic, drilling, exploration and production, team members can also access detailed descriptions of the events leading up the present.

Those engaged in making decisions for exploratory wells can obtain a full brief of both information and through collaboration with essential personnel. Software developments at E&P companies are at the heart of production improvements.

Technology Improvements

Research in unconventional oil and gas technology is ongoing industrywide. GTI was awarded $6.2 million by the Research Partnership to Secure Energy for America to develop and design new techniques in support of environmentally safe and economically efficient hydraulic fracturing projects.

This work is derivative of an innovative technique recently completed at Marcellus Shale involving a field-based industry collaborative R&D project.

A new technology for natural gas purification uses a hollow fiber contactor design that offers significant advantages over traditional technologies, ultimately reducing gas purification costs significantly.

This technology can be applied to pre and post combustion carbon capture and is applicable for use in floating LNG platforms.

Only recently has there been a holistic strategy for managing risk and compliance across functional domains and the lines of business. Today, with heightened regulation and increasingly complex risks, technology is more important than ever before.

Conventionally, upstream operations have struggled to overcome segregation of data. Now integration and knowledge sharing are driving industry advances.

For more on how oil and gas is changing, read this article on the evolving role of IT…

What is a Christmas Tree?

What is a Christmas Tree?

A Christmas Tree is an assembly of valves, spools, and fittings placed on a producing well to control the flow of the fluid that comes out of the well (usually oil or gas), to transport oil/gas from well to pipeline or to control the injection of gas or water into the well to enhance its production.

How is it important to us?

Oil and Gas: Christmas TreeThe name comes from the fact that it resembles a decorated tree.

The Christmas tree and the wellhead should not be mistaken. The Christmas tree is installed on top of the wellhead to seal the annular space between the casing and the tubing.

Christmas tree can be used on both offshore and onshore wells and are therefore identified as subsea tree or surface tree.

What is Cushing?

What is Cushing?

Cushing, Oklahoma, often referred as the “pipeline crossroads of the world“, is a major storage and trading terminal for crude oil.

How is it important to us?

Cushing is a historical city in the oil and gas industry. It has been a critical point for traders given its role as a major delivery point of the US crude oil futures (the West Texas Intermediate (WTI) for example which prices are quoted on the New York Mercantile Exchange).

Oil was discovered at Cushing in March, 1912 by Tom Slick and C. B. Shaffer.

In 1919, the production accounted for 17% of U. S. production and 3% of world production.

What is Acidizing?

What is Acidizing?

Acidizing is a well stimulation or rehabilitation method that consists of pumping acid (usually hydrochloric acide HCl) into the well to dissolve all materials preventing the permeability of the formation.

How is it important to us?

Acidizing can restore and improve the well productivity by creating new flow channels.

There are two main types of acidizing treatments related to  the pumping pressure and acid injection rate:

  • Matrix acidizing which is used to clean up formation damages caused by drilling, completion, and work-over fluids and solids. Acid is injected into the well at pressure below the fracture pressure;
  • Fracture acidizing (acid fracing) which is performed to enhance the well production. The reservoir is hydraulically fractured and then the fracture faces are enlarged by injecting acid at pressure above the fracture pressure.

Acidizing injection

Software Consulting in the Real World

Entrance prides itself on fostering an environment of learning for all of our employees, so we have recently started a monthly brown bag lunch sessions where our consultants take turns sharing knowledge and best practices with their co-workers. For this first event, I led a discussion on developing software in less than ideal conditions.

To start out, I presented a theoretical case where Entrance is engaged to work for File & Co. They have several internal applications, all of them developed by a 3rd-party contractor. The internal apps are becoming outdated, and File & Co. decides not to renew the contract when it expires on Dec 31st, 2013. They hire Entrance to rewrite the apps and handle migration, starting with one that manages customer information. The proposed interface for the new application looks something like this:

Application interface

The initial requirements seem simple, but as a result of office politics, it is not possible to implement the ideal solution. Difficulties include the need for the app to be able to read and write in both two databases and the old contractor denying access to the code because it is proprietary.

As a result of the dual database issue, Entrance modifies their ideal solution to include a drop-down that toggles between the new and old database.

Capture

 

During the rest of the brown bag, Entrance’s consultants discussed how the development of a web app that could get around these difficulties, particularly when all the needed code is not available.

This example situation is fairly close to what actually happens when Entrance engages with a new client. While we strive to utilize best practices and the most up-to-date technology, software consulting also requires that we pay attention to the world that our clients are operating in, and create solutions that meet the needs of that situation.

Find out more about our process and methologies…

Four Windows 8 Tips from a Senior Software Architect

The Windows 8 buzz just goes on and on, and you may be wondering, “Is this operating system even appropriate for an enterprise situation like mine?’

The answer is, maybe, depending on what you want to use it for. Here are four tips that you should consider from  a software architecture perspective:

  1. Don’t assume that just because Windows 8 is so different that it won’t work for you and your company. Have a few users within the company test it out for a while before you decide either way.
  2. Be very clear about what you want before you upgrade. Factors like information consumption versus creation in employee profiles, employees in the field and the cost of change management may affect your decision.
  3. Data entry is not a key strength of a tablet or mobile device. If this is a key function for a certain population within the company, consider sticking with a more traditional desktop environment for those employees.
  4. Windows 8 works very differently from any previous operating system. Make sure to give employees resources and time to learn how to use it once you do go ahead with implementation.

We are really excited about the way that Windows 8 merges modern user behavior, as it supports both a touchscreen interface and the data integration to back that activity up. Want to find out more about what the Windows 8 launch means for you and your business?

Download a free copy of our new article, “Windows 8: So Now What?”