3 KPIs All Oil and Gas Companies Need on Their Dashboards
No industrial business that hopes to turn a profit in the era of Industry 4.0 can do so without selecting the right key performance indicators (KPIs). These metrics afford operations managers and senior-level decision-makers critical snapshots of how their plants operate and, more importantly, how they ought to operate in order to compete.
When it comes to Oil and Gas, the KPIs that processing facilities choose and utilize depend on their unique objectives. Even businesses within the same industry may seek vastly different insights from their data. But given the state of O&G in America today, which KPIs often make the cut?
1. Capital project efficiency
Between 2006 and 2013, budgets for capital expenditures into exploration and upstream oil production grew at many E&P firms, but have since failed to deliver on the allocation, according to a report from PricewaterhouseCoopers. Capex concerns have been no doubt exacerbated by steep decreases in per-barrel oil prices then and now.
As the Oil and Gas industry as a whole moves into more challenging drilling and extraction environs, it should consider how to visibly articulate capex project efficiency, a multifaceted measurement that combines adherence to stricter budgetary allowance, maintenance spend, and project overrun as well as creep.
2. Attendance and completion of safety training
Safety is notoriously difficult to track. This particular KPI can give on-site safety managers a peek at potential dangers to come. Oil and Gas needs this now more than ever – according to E&E News analysis of data from the Occupational Safety and Health Administration, severe work-related injuries pertaining to “support activities for oil and gas operations” occurred at a rate of nearly 149 per every 100,000 workers. Severe injury includes amputation, in-patient hospitalization, or loss of an eye.
It stands to reason that those who undergo safety training courses will act safely and avoid injury. Safety managers must therefore address any barriers suppressing attendance or completion, and KPIs tracking both will alert them to such issues, especially if they monitor the rate at which completion occurs over time. Advocacy for training will ensure investment into these programs pays off as soon as possible, a crucial factor as many O&G companies face tight margins.
3. Leaks per X customers
Midstream oil and gas firms oversee an incredibly long and intricate distribution network, which requires an understanding of its environmental impact. U.S. Oil and Gas companies manage 2.4 million miles of energy-related pipe and 72,000 miles of crude-oil pipe, according to Pipeline101.org, a website maintained by the Association of Oil Pipe Lines and the American Petroleum Institute.
Aligning maintenance spend with environmental regulations requires a deeper look into how often leaks occur, in relation to customer revenue, and which assets incur the highest repair costs.
Although these KPIs have driven success for others, their real value lies in how facilities implement them through continuous improvement initiatives. To speak to organizational management consultants on how to turn KPI insights into actions, contact USC Consulting Group today.