uncovering the impact of data governancedm4ep.com/data/shawtin-marakesh.pdf · – “the business...
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Uncovering the Impact of Data
Governance
Steve Hawtin
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© 2013 Schlumberger. All rights reserved.
An asterisk is used throughout this presentation to denote a mark of Schlumberger. Other company, product, and service names are the properties of their respective owners.
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Why measure business impact?
� Value based management
– Provides the business case for investing in "Data Services", "Data Quality", "Data Architecture" or "Data Governance"
� How to measure the value that data, data management and data governance delivers to an oil company?
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� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
Learning from others
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2011 CDA Study
� Attitudes of budget holders to data management
� What do they believe?
– What value does data management deliver?• What value does data deliver?
• Where is value lost and not realised?
– What would improve the presentation of data management?
– Where are the key opportunities to improve?
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CDA Study
Published Feb 2011
http://www.oilandgasuk.co.uk/datamanagementvaluestudy/http://www.oilandgasuk.co.uk/datamanagementvaluestudy/http://www.oilandgasuk.co.uk/datamanagementvaluestudy/http://www.oilandgasuk.co.uk/datamanagementvaluestudy/
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Report
� The value of data
– Cost v Value
– The beliefs of senior staff
� Value of data management:
– How long data delivers value
– Company size
– The role of ‘Data Management’
– Common opportunities to improve
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Depreciation$
Total
Capitalisation
Added Value
External
Contribution
$
$
$
Working out the “Value of Your Data”
Improved
Operations
Increased
Production
Asset
Development
Increase in
Reserves
Others (?)
Understanding
of Subsurface
People
Data
Tools
Process
%
% %
%
%
%
%
Value created
by projectValue created
by projectValue created
by projectValue created
by projectValue created
by project
Internal
Contribution
$
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Value of projects – Two Simplified Examples
� 20 year drilling program to 2030
� 400M barrels from 20 additional wells (20M each)
� £20M to drill each well ($34M)
� FPSO - £2B ($170M / well)
� 20M barrels @ $40 => $800M
� Value created: $696M per year
� 50% interest cost £5M
� Spent £20M over 2 years
� Turned down offer of £100M for our stake
� Value created: (100-5-10)/2 => £42½M per year
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Asset Development
IncreaseProduction
IncreaseReserves
Corporate Focus
95% of value was generated within three groups of activities
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How much
does the
subsurface
contribute?
Development
Reserves
Production
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What contributes to sub-surface understanding?
Individual responses
AverageValues
38.5%
32.7%
15.1%
13.7%
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DataPeople
ToolsProcess
The elements that contribute towardsunderstanding the sub-surface
What contributes to sub-surface understanding?
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Depreciation$
Total
Capitalisation
Added Value
External
Contribution
$
$
$
Combining the results
Improved
Operations
Increased
Production
Asset
Development
Increase in
Reserves
Others (?)
Understanding
of Subsurface
People
Data
Tools
Process
%
% %
%
%
%
%
Value created
by projectValue created
by projectValue created
by projectValue created
by projectValue created
by project
Internal
Contribution
$
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Contribution of subsurface data to
total value generated each year
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DAMA Data Management Body of Knowledge
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E&P Varient
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Key Opportunities for Improvement
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CDA Report Conclusion
� Reinforces things we already know:
– Focus on increasing business value
– The limitations of “Value Based Management”
– Be proactive (of course)
– Point out the value of data (again)
� Data Governance is the single most important missing element
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� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
Learning from others
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Paul Haines & Mark Wiseman - 2011
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Questions
� How can we measure data value?
� Can we measure true data costs?
� How does the management of data affect value?
– Does data quality detract from business decisions?
� Determine factors and build a model…
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Cost v value
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Variation in the value of data over time
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Hess - Noah Study - 2011
� Created model of the whole E&P process
� Extra $1M in DM triples value from decisions
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Conclusions
� Value of the data far outweighs the costs
� In this situation good data management is a very attractive investment
– $1M investment delivers >$30M additional value generated
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� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
Learning from others
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Dan Shearer & Debbie Garcia - 2006
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Application Deployment Lifecycle
Analyse
SolutionsEvaluate Implement
Maintain
MatureDiscontinueObselete
Define
Need
Retire
Understand Workflows and requirements
Compare and weigh choice
vendors, support, training,
IT testing, report defects, training, tuning, integration, configuration
User training, installation, performance,
growth, support in place
Stable performance and user base, plan upgrades, monitor
usage
Patches only, replacement being
evaluated
Minimal support from vendor, replacement available
Business requirement
changed, newer technology
available, product or vendor changes
Migrate data to replacement, remove from system, request data from end
users
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Approach
� Identify the applications apparently performing "the same" job
� Validate there really was overlap…
…and retire the "least used"
� Invest in Change Management:
– Communicate to users
– Train users in the replacements
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Burlington - Shearer - 2006
� Actual benefit was significantly more than software cost
2002 Actual 2003 Actual 2004 Actual
9.2
25.5 25.3
Add Reserves
Productivity
Finding Costs
%dry holes
SW savings
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Conclusion
� Measured improvement in "the information landscape" responsible for 20 times more "business value" benefits than "IT" benefits
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� The Business Case– “The business value case for data management” CDA (2011)
– “The Main Sequence: Matching Data Management Change to the Organization” Jess Kozman – PNEC12 (2008)
– “Quantitative value of data & data management” Paul Haines & Mark Weisman – PNEC15 (2011)
� Implementation Examples– The DAMA, ITIL, PMI & PRINCE2 standards
– “Information Requirements” Nigel Corbin – ECIM 2010
– “Data Ownership Model in DONG E&P” Kenneth Nordstrøm – EAGE Vienna (2011)
– “Improving technology investment planning with metering” Dan Shearer – PNEC10 (2006)
– “Experience from IM Assessments: E&P Data Management in 2006” Steve Hawtin – PNEC10 (2006)
– “The Data Integration Spectrum’” Steve Hawtin et al – AAPG Cairo (2002)
Learning from others
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Conclusion
� In most oil companies (at the moment) Data Management is an opportunity for investment rather than an overhead to be cut:
– Data is a significant asset
– Improving data handling has significant impact
• Business impact typically >10 times IT
Personal Observation: Data Governance is commonly the underlying issue