busiplan11

8/18/2019 BUSIPLAN11

1/15

Weatherford Fluid Systems

Fluids Business Plan – Eastern Hemisphere and The HUB

Preface

This document examines opportunities for the chemicals business in the UBSeastern hemisphere operation (EHO! "t is not a definiti#e document and it $ille#ol#e! % more complete plan can only be produced after substantial consultation$ith mana&ement in the EHO re&ions and the fluids &roup! "nitial' brief discussion$ith personnel in the re&ions has pro#ided #aluable information!

The main focus is on $ell site applications (UB) includin& &as lift! The tar&et mar*etis defined' customers identified and proposals are made as to ho$ best to positionthe HUB $ithin the company to exploit those opportunities! +ar&ins are discussedand a retrospecti#e presented $here data is a#ailable!

Business Plan Summary & Recommendations

,hemicals $ill be a *ey element in the UBS business &oin& for$ard! Properly

mana&ed' $ith sufficient resources' the chemicals related business $ill &enerate&ood mar&in' $ith hi&h added #alue' Weatherford brand products!

,hemical sales' currently around -. ++ annually for the Eastern HemisphereOperation (EHO' are expected to &ro$ at a rate in line $ith the UB) businessforecasts by The /e&ions for the year 0110!

Extrapolation for 2 years startin& 0113 &i#es a fi&ure of -.1 ++ chemical sales' $itht ti l -30 ++ fit f 0112 Th t fi i hi bl b t th t it l


2/15

t ti l -30 ++ fit f 0112 Th t fi i hi bl b t th t it l


A! +o#e to 311 Weatherford chemicals in UBS (includin& pipeline andindustrial by end of 0nd


3/15


0110 Totals EH(

Predicted Total

UB) /e#enue -C'2C'111 -00'D.2'111 -0.'.3A'111 ),%*0.,*Predicted,hemicals Sales/e#enue -0C.'AA1 -A'321'C1 -3'011'111 ),*0'*. %nticipated,hemicals Sales Total UB) A!11 3!0C 2!32

Factor(Sell5Purchase . . .Predicted,hemicals Profit -32.'2C -0'A3'23 -C'C11 ).*%1.*'.1

Introduction

The concept of chemicals and fluids as a separate product line $ithin Weatherford is

relati#ely ne$! Traditionally' Weatherford has not been $idely considered a pro#ider of chemical fluids technolo&y = althou&h their dominant position in UBS' and UB) inparticular' is no$ reco&nised!

,hemical s*ills' resources and appreciation of opportunity' althou&h hi&h in calibre$ithin the &roup' ha#e been thinly spread! Ienerally' chemicals represent 9the blac*art: and are used as tools in the UBS operation by en&ineers' $ithout additionalmar*etin& of the product line! 4either are the supportin& resources stron&ly

* t d t th li t t " i t .rd t h i l h b


4/15


?o$ in#estment cost

The chemical product cate&ories are lar&ely in place and the product line is bein&

rationalised but there is' as yet' no stron& brandin& of the products and mar*etin& islimited! ,han&in& this $ould be inexpensi#e but professional ser#ices must beemployed! "f en&ineers or chemists are employed in a mar*etin& role then results $illbe disappointin&! Historically' scientists $ithin ser#ice companies ha#e producedtechnical sales literature that fails to excite!

Brandin& and product mar*etin& is a Gob for professionals! "n this author@s experience

memorable rele#ant names for products can help the sales effort!

% recepti#e capable $or*force

Education 7 %$areness

The $or*force is accustomed to usin& some chemicals as basic tools in Weatherfordoperations! There is ho$e#er' little focus on chemicals as a maGor opportunity! 4or

are chemical solutions reco&nised as an effecti#e tool in 9pull7throu&h: $or*! %limited additional in#estment in education of personnel &enerally' to&ether $ith thepositionin& of a small number of *ey personnel' $ill pay di#idends! This can enhancethe reputation of a branded ran&e of chemicals and build the ima&e of Weatherfordas a pro#ider of 9chemical technolo&y:! % $or*force $ith confidence in companyproduct lines is a po$erful sales de#elopment tool' that tool must be properlyprepared!


5/15


proceeds to select additional associated ser#ices! "t is in this pull7throu&h in $hichthe operator is seen as a client of the chemicals J fluids business!

There is' at this time' no intention to sell chemicals $ithout UBS personnel andser#ices! Each opportunity to trade chemicals alone should be examined #erycarefully! The ability to offer a comprehensi#e solution or system depends on thepresentation of a premium 9pac*a&e: at the customer interface rather than indi#idualitems or chemicals! +a*in& chemicals a#ailable $ithout associated ser#ices $ouldundermine that perception and imply that the system is in fact modular! The clientmi&ht then be encoura&ed to consider introducin& chemicals from other suppliers

(cheaper'


6/15


%ssess and present on ne$ chemical technolo&ies and on ri#al technolo&ies tooperations and B)!

"n response to operations mana&ement re


7/15


important to future plannin&! "t is important to ensure that procedures are in place toproperly capture and store all information centrally! %n attempt has been made toimplement a system (ne$ account code issued to re&ions +ay 0110 by Bill Berner8

it is important that the fluids &roup is able extract pertinent information from theaccountin& data &enerated!

The Resources

• ,lear$ater de#elopment and technical support

• Weatherford@s Houston Fluids &roup

• Fluids Technical team rotatin& out of Houston• HUB personnel

• Operations personnel

The current sales force can pro#ide the basic #ehicle for sellin& the Weatherfordchemical product lines at the customer interface! % stron& appreciation of ho$chemical systems contribute to a successful operation is #ital to build the bottom line

$ith income from fluids! That appreciation $ill come throu&h technical presentation'trainin& and support! Technical sales support specialists must be readily a#ailable toreinforce the ima&e of our chemical fluids! That le#el of support must be decided for the tar&et return on in#estment!

3uanti$yin4 the plan

The fi&ures for the for$ard plan ha#e been &enerated from an examination of

hi t i l d t i th i l t il bl F il bl d t th t t l


8/15


0! )eploy additional resources to ensure that the UBS $or* expansionen#isa&ed in the +E4% plan document is ser#iced as far as is possible byWeatherford chemical products and ser#ices!

Train sales5B) and operator staff in chemical products and opportunities "ncrease ,hemical B) staff in the re&ions Europe5+E5%sia = one person

$ith dual B)5field support function employed in .rd


9/15


to $in in future' thou&h in the short term this is not expected to ha#e an impact onsales! The assumption has been made here' that the mar*et share $ill remain as atpresent throu&h 011D! That may not be so! So called aphron fluids from +" for

example' represent a challen&e' $hich has not yet been


10/15


0113 0110 011.011A

0112

1!11

2!11

31!11

32!11

)""

EH( UB6 Chemical Sales

Profit non $fd chems Potential Profit 7 $fd chems ,hemicals Sales Estimated +ar*et 7 EHO chems UB)

Fi&ure 0 7 "ncome for a .2 Lear on Lear Iro$th rate for ,hemicals

Short7term obGecti#es and specific opportunities must be determined in theimmediate future! The list of clients and potential proGects in the next 3 months hasbeen detailed else$here recently but proGects that ha#e not de#eloped as hoped'must be re#isited! +i*e Buchanan has identified some of these (BP 4orth Sea' sand

l t d UB) G t + * 6 t lift i li d t P l


11/15


% system de#eloped specifically to counter the aphron threat' if not already in place'should be considered! % file addressin& the top opportunities in fluids is attached'$ith a similar file for UB) in appendix 3

Pricin4

Typically the sellin& price of acid corrosion inhibitors is c!a! -C15us& 9boo* price: inthe U!S! and -C1715us& in Europe! These products perform a similar role to theWeatherford products! Both can be mar*eted stron&ly as chemical technolo&y! %cidcorrosion inhibitors ha#e traditionally been 9o$ned: by the pumpin& companies! "f that company pumps acid then they supply the inhibitor! This su&&ests that theWeatherford ran&e of chemicals is sellin& belo$ mar*et #alue! The same may betrue for other chemicals in the ran&e! The re7brandin& and namin& process shouldallo$ for an increase in price! This should be supported by a stated policy of usin&only Weatherford chemicals systems for UBS operations! "n the experience of thisauthor a tar&et factor for sale5cost should be . or &reater on all Weatherford brandchemical systems!

The Pipeline and Industrial Business

There is little doubt that opportunity for chemical sales and ser#ices in PJ"applications is #ast' 4o$sco7B> and Halliburton' amon& others ha#e demonstratedthis! Se#eral factors contribute 7

• The lar&e number of industries that must carry out line' process and #esselcleanin&' preparation and testin&!


12/15


ser#ices bac*&round it is #ery easy to miss &reater potential for sales in other industries!

Place an experienced' capable person in the +E4%5EHO to *ic*7start the PJ"chemical operations of the combined Weatherford pipeline companies! The personshould ha#e a chemical bac*&round and must appreciate that 9solutions: rather thanchemicals are the added #alue product line!

,urrently chemical cleanin& in much of the Weatherford line &roup is put to . rd party'for #arious reasons! This should be chan&ed! The hi&h mar&in on tailored chemicaltreatments is a#ailable!

Obtain the ser#ices of an en&ineer $ith experience in chemical cleanin& of pipelineand industrial e


13/15


2 Plan $ith US Fluids Iroup to set up SOP@s and systems to effecti#ely trap andcollate data from re&ions throu&h the HUB to enable more accurate for$ardplannin&!

C )efine the limits of Weatherford chemicals 9sales: business $ith the HoustonFluids &roup! Ensure efforts are properly focussed to a#oid di#ersion intocommodity chemicals or 9unsuitable: mar*ets!

D ?iase $ith Weatherford Fluids Iroup &lobal and desi&nated' Weatherfordappro#ed' chemical suppliers to the re&ions!

6uantify income from 9added #alue: en&ineerin& ser#ices associated $ithfluids' such as those pro#ided by %P for future business de#elopment plan!

Propose a method to extend (to other re&ions the ser#ices in if they arenot already a product line!

31 Examine the case for installin& chemical blendin& facilities in +E4% and %P/

to ad#ance the UBS and fluids business!

33 ,ontact country mana&ers to discuss aspects of the Weatherford chemicalsplan and encoura&e future input!

Re$erences

T > *i +E4% 0110 l P P i t P t ti


14/15


%ppendix 3

The current top UB) opportunities "dentified to the EH HUB

UB) Ops Fluid Ops

%ppendix 0 = ,hemical sales component

0 1 1 3

0 1 1 0

0 1 1 .

0 1 1 A

0 1 1 2

1

311

011

.11

)""5s

EH( UB6 Chemical Sales

Profit non $fd chems Potential Profit 7 $fd chems ,hemicals Sales Estimated +ar*et 7 EHO chems UB) UB) Sales

Microsoft ExcelWorksheet

Microsoft ExcelWorksheet

3A


15/15


Fi&ure .7 Plan chemical sales compared to total UB) sales

32

busiplan11

Documents