strategic project selection in oil & gas industry
DESCRIPTION
How Pinnacle refinery (name changed) went about strategic project (Lean Six Sigma) selection and deploymentTRANSCRIPT
![Page 1: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/1.jpg)
1
LEAN SIX SIGMA IN A PETROLEUM REFINERY - A CASE STUDY
NAVEEN NARAYANANSSA BUSINESS SOLUTIONS (P) LTD.
SEPTEMBER 24TH, 2011
PRESENTED TO:
![Page 2: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/2.jpg)
2
INDUSTRY CHALLENGES
‣ State regulated product pricing
‣ Cumulated losses of
₹78000 crores in FY 2010-2011*
‣ Capital intensive & high operating cost
‣ Huge profit leakages due to process inefficiencies
*SOURCE: BUSINESS STANDARD, MAY 2011
![Page 3: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/3.jpg)
3
NEED OF THE HOUR
PEOPLE ENROLLMENTEVERYONE COMMITTED & INVOLVED
| PROACTIVE PROBLEM SOLVING
PROCESS EXCELLENCECONTINUAL IMPROVEMENT | FACT
BASED MANAGEMENT
WASTE ELIMINATIONREDUCE PROFIT LEAKAGE |
ENHANCE EFFICIENCY
OPERATIONAL EFFICIENCYREDUCE COST | IMPROVE EFFICIENCY
NEED OF THE HOUR
![Page 4: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/4.jpg)
4
CI INITIATIVES
7 QC Tools Quality Circles Suggestion Scheme
5 ‘S ’ Daily Work Management
TPM
Strategic Alignment? Bottom-line focus? Sustainable?| |
![Page 5: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/5.jpg)
5
WHY LEAN SIX SIGMA?
✓ Engagement across the organization
✓ Analytical approach
✓ Align-able with strategy planning
✓ Focus on operational efficiency
✓ Capability for breakthrough improvements
✓ Internalization of Six Sigma skills
✓ Cross-functional team based problem solving
✓ Drive continual improvements
![Page 6: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/6.jpg)
6
LSS DEPLOYMENT ROADMAPHOW ‘PINNACLE’ REFINERY EMBRACED LSS
![Page 7: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/7.jpg)
7
ROLL-OUT MODEL
PILOT PHASE SCALE UP PHASE SUSTAIN PHASE
PILOT WAVE (6 MONTHS)
- PROJECT REPOSITORY
- LEADERSHIP BUY-IN
- CREATE BUZZ
- PEOPLE ENROLLMENT
SCALE-UP (1 YEAR)
- COMPANY-WIDE ROLLOUT
- SUPPORT FUNCTIONS
- FINANCIAL FOCUS
- KRA LINKAGES
- INTEGRATE WITH STRATEGY PLANNING
- ALIGN WITH BSC
- INTERNAL MBBs
INTERNALIZE (3 YEARS)
![Page 8: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/8.jpg)
8
DEPLOYMENT ROADMAP
Training
-Executive Overview (Leadership)-Champions training (15)-Green Belt (19)-Black Belt (11)
-Green Belt (31)-Black Belt (17)
-Green Belt (86)-Black Belt (15)
Coaching
-GB Projects (7)-BB Projects (4)
-GB Projects (11)-BB Projects (5)
-GB Projects (23)-BB Projects (7)
Piloting
Wave 2 Scale up
![Page 9: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/9.jpg)
9
PROJECT SELECTIONHOW ‘PINNACLE’ IDENTIFIED STRATEGIC PROJECTS
![Page 10: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/10.jpg)
10
PROJECT SELECTION
✓ Top-down approach
✓ Leadership Involvement
✓ Balanced focus
✓ Realistic expectations
✓ Aligned with scorecards
![Page 11: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/11.jpg)
11
TOP DOWN APPROACH
MISSION: “A Great Place to Work”
VISION:“Role Model for Environmental, Health, & Safety Performance”
“Consistently Most Profitable, and Reliable Refinery”
“Market Responsive”
STRATEGIC THEMES:1)Environment & Safety Performance2)Market Responsive/ Customer Focus3)Resource Optimization4)Great Place to Work
STRATEGIC INITIATIVES:1)Six Sigma Projects2)Other Strategic Projects3)People & Process Alignment
![Page 12: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/12.jpg)
12
REFINERY VISION:ROLE MODEL FOR EHS | CONSISTENTLY MOST PROFITABLE AND RELIABLE REFINERY | MARKET RESPONSIVE
REFINERY VISION:ROLE MODEL FOR EHS | CONSISTENTLY MOST PROFITABLE AND RELIABLE REFINERY | MARKET RESPONSIVE
ENVIRONMENT & SAFETY PERFORMANCE
ENVIRONMENT & SAFETY PERFORMANCE
MARKET RESPONSIVE/CUSTOME
R FOCUS
MARKET RESPONSIVE/CUSTOME
R FOCUS
RESOURCE OPTIMIZATION
RESOURCE OPTIMIZATION
GREAT PLACE TO WORK
GREAT PLACE TO WORK
✓Improve Reliability of Fire Extinguishers
✓Bring Down Number of Fires
✓Improve Reliability of Fire Extinguishers
✓Bring Down Number of Fires
✓Bitumen Lorry TAT < 2hr.
✓Product Availability for MMPL
✓Biturox Production (All 3 Grades Availability)
✓Minimize fill weight variation of LPG
✓Minimize losses during ATF production
✓Bitumen Lorry TAT < 2hr.
✓Product Availability for MMPL
✓Biturox Production (All 3 Grades Availability)
✓Minimize fill weight variation of LPG
✓Minimize losses during ATF production
✓Maintain FO line sample viscosity between 150-180
✓Increase Power Reliability
✓Minimize variation in LPG Filling
✓Sustain Yield as per VDU Column
✓Reducing Tankage TAT
✓Minimizing Crude Loss
✓Maintain FO line sample viscosity between 150-180
✓Increase Power Reliability
✓Minimize variation in LPG Filling
✓Sustain Yield as per VDU Column
✓Reducing Tankage TAT
✓Minimizing Crude Loss
✓Reduce Wastage in Canteen
✓Minimize complaints in estate
✓Increase number of suggestions
✓Minimize electricity consumption in estate
✓Optimize overtime in canteen
✓Reduce Wastage in Canteen
✓Minimize complaints in estate
✓Increase number of suggestions
✓Minimize electricity consumption in estate
✓Optimize overtime in canteen
PROJECT DRILL-DOWN
MISSION:“A GREAT PLACE TO WORK”
MISSION:“A GREAT PLACE TO WORK”
![Page 13: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/13.jpg)
13
PROJECT SELECTION RATIONALE
‣ Organizational Impact
‣ Clarity of Scope
‣ Feasibility of Solutions Implementation
‣ Feasibility of Completion within 6 Months
‣ Cuts Across Functions/Cross Functional Teams
‣ Domain Expert Available in Team
![Page 14: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/14.jpg)
14
SAMPLE PROJECTSProject Goal Metric Baseline Goal
Optimize Product Yield for VD, and VGO from VDU Column
% Wt. on crude
2.5% 3.9%
Reduce H2 Losses to flare
Tons/day 2.4 ton/day 0 ton/day
Reduce TAT of Bitumen Lorries
Time 4.3 hrs. 2 hrs.
Improve Reliability of Rotary Equipments
Failures/yr.
4/year 2/year
Maintain Fuel Oil Viscosity
CST 260 160
Improve Reliability of Fire Extinguishers
% non reliable
15% 5%
Optimization of I/F generation in MMPL Volume 206 Kl 195Kl
![Page 15: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/15.jpg)
15
5
2 1
3
4
PROJECT HOPPER
‣ Align LSS with annual strategy planning/Balanced Scorecard
‣ Monthly steering committee meetings to review progress/identify projects
‣ Customer voice as a source of projects
‣ Linkages with KRA
![Page 16: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/16.jpg)
16
COMMON PITFALLS AVOIDED
Web
(1) Hype‣Piloting‣Avoided Big-Bang rollout
(2) Trivial Projects
‣Project drill-down from strategic theme‣Charter created by champions
(3) Vague ₹ Gains
‣All projects’ gains ratified by CFO
(4) Limited Champion Support
‣Champions involved at early stages‣Training/certification mandatory‣KRA Linkages
(5) Tool Obsession
‣Application of tools on need base‣Retrofit data analysis instead of DOE wherever possible
![Page 17: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/17.jpg)
17
SUCCESS FACTORS
‣ Involvement of Sponsors at all stages
‣ Meticulous project selection process
‣ Abundant data in system
‣ Strict adherence to timelines & toll-gates
‣ Realistic Expectations
![Page 18: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/18.jpg)
18
ENHANCED CUSTOMER SATISFACTION: SEVERAL PROJECTS LINKED WITH CUSTOMER EXPERIENCE & LOYALTY
PROCESS IMPROVEMENT: BREAKTHROUGH AND SUSTAINABLE PROCESS IMPROVEMENTS
ACCOLADES: RECOGNIZED AS BEST PROJECTS IN SEVERAL NATIONAL & INTERNATIONAL AWARDS SUCH AS INSSAN, QIMPRO, IDEAS ETC.
PRODUCTIVITY GAINS: DRAMATIC IMPROVEMENT IN OPERATIONAL EFFICIENCY, CONSISTENCY AND RELIABILITY OF PROCESSES
FINANCIAL SAVINGS: DIRECT LINKAGE TO BOTTOM-LINE, CUMULATED SAVINGS (RATIFIED) OF OVER INR 200 CRORE
RESULT
![Page 19: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/19.jpg)
19
CASE STUDY 1:VDU COLUMN YIELD
IMPROVEMENT
![Page 20: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/20.jpg)
20
PROCESS SCHEMATIC
![Page 21: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/21.jpg)
21
PROJECT CHARTER
![Page 22: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/22.jpg)
22
PROCESS TREND
LOW VD YIELD - AVG. 2.63% V/S TARGET 4%
![Page 23: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/23.jpg)
23-VE Cpk VALUES INDICATE EXTREMELY POOR
PERFORMANCE
PROCESS CAPABILITY
![Page 24: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/24.jpg)
24
PROCESS FMEA
![Page 25: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/25.jpg)
25
POTENTIAL CAUSES
X1 X2
X3
X4
X5
Y
![Page 26: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/26.jpg)
VDIR/RCO V/S YIELD HVGOCR V/S YIELD
LVGOCR/RCO V/S YIELD RTC 293 V/S YIELD26
REGRESSION
![Page 27: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/27.jpg)
27
DRAMATIC IMPROVEMENT IN VD YILED - AVERAGE YIELD OF 4.5%
BREAKTHROUGH RESULTS
![Page 28: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/28.jpg)
28
![Page 29: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/29.jpg)
29
CASE STUDY 2:REDUCTION IN GATE ENTRY
TIME
![Page 30: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/30.jpg)
30
BUSINESS CASE
Project Title: Reduction in process time for Gate Entry Operation for visitors
Problem Definition:-Welcome slip is not ready when visitor arrives.-Average 15 minutes are taken for gate entry process
-Too many counters for Welcome Slip, Mobile Phone hand-over, Vehicle pass, Laptop and other item entry
Goal:-Reduce Gate entry processing time-Provide better experience to the visitors at Gate entry-Improve company image
![Page 31: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/31.jpg)
31
AS-IS PROCESS
![Page 32: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/32.jpg)
32
Problem Root Cause SolutionToo much waiting for Visitors at early morning, lunch time & end of the shift
No manning before 8am, after 3:30pm, lunch time
2 shift Counter operation (7:30 am to 5.30 pm)
Visitors had to move back & forth at different windows
Vehicle pass, Laptop entry & Mobile deposit area at different counter
Vehicle no on the same welcome slip, single window approach, allow mobile for admin area, laptop entry by visitor CISF to confirm
Visitor has to wait till welcome slip is ready
Minimum communication between the visitor and staff
SMS to visitor on slip approval to ensure the slip is created prior
All types of visitors through Welcome Slip
No convenient procedure for contractor, delivery persons
Welcome Slip for visitors and daily pass for technocrats/ delivery persons
ROOT CAUSES
![Page 33: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/33.jpg)
33
Phase I: Implemented Solutions
One window will be operational all the time
2.System-generated monthly report giving department-wise count and just-in-time slips
3.Training and job rotation for window clerk
Phase II: Implementation in pipeline
Board at entrance to guide people of different locations
2.Infrastructural modifications will be undertaken for front end counters
3.Kiosk with a printer for enabling the visitor for generating the welcome slip on his own without external interference and CISF to check and allow the visitor after photo id confirmation
SOLUTION IMPLEMENTATION
![Page 34: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/34.jpg)
34
IMPROVED PROCESS
![Page 35: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/35.jpg)
35
Gate Entry Processing time reduced from Avg.15 mins to Avg. 4 mins
BEFORE/AFTER
![Page 36: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/36.jpg)
36
ABOUT SSA
![Page 37: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/37.jpg)
37
PURPOSE & VISION
Purpose:To enhance Stakeholder’s Value through partnering for growth; our journey will continue as long as there is a passion for perfection.
Vision:To become the No.1 Business excellence solutions provider in India by 2015 with 20% revenue from overseas consulting.
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 38: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/38.jpg)
38
HISTORY
1999
SSA IS BORNSSA IS BORN
- BORN WITH A MISSIONARY ZEAL
- VISION: ‘MAKE MADE IN INDIA SYNONYMOUS TO QUALITY’
MANAGEMENT SYSTEMSMANAGEMENT SYSTEMS
2001
- ISO 9001, QS 9000, ISO 14000, ISO 27001
- HRMS
- BPMS
- SIX SIGMA
PROCESS EXCELLENCEPROCESS EXCELLENCE
2006
- ENTERPRISE-WIDE PROCESS MODELING
- PROCESS REPOSITORY CREATION
- KPI DASHBOARDS
- LEAN DEPLOYMENT
- GLOBAL ALLIANCES
- GLOBAL DEPLOYMENTS
BUSINESS EXCELLENCEBUSINESS EXCELLENCE
2010
- INTEGRATED STRATEGY & PERFORMANCE MANAGEMENT SYSTEM
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 39: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/39.jpg)
39
ACCREDITATIONS
RATED SE-2A BY CRISIL | HIGH PERFORMANCE CAPABILITY HIGH FINANCIAL STRENGTH
ISO 9001 CERTIFIED
ANSI IACET 1-2007 AUTHORIZED PROVIDER
ISO 27001 ISMS CERTIFIED
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 40: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/40.jpg)
40
SELECT CLIENTELE
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 41: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/41.jpg)
41
GLOBAL REACH
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 42: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/42.jpg)
42
BASKET OF OFFERING
Lean Six Sigma
Lean Management
BPMS Solutions
TPM
ISO/ISMS/EMS/OHSAS
Process SimulationDaily Work Management
Project Management
Design for Six Sigma (DFSS)
Performance Management
IT & ITES Support
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 43: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/43.jpg)
43
SSA’S ISM MODEL
“ISM® aligns people and the processes with the corporate objectives and goals”
- NCHIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 44: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/44.jpg)
44
QUESTIONS?!
HIGH PERFORMANCE CAPABILITY | HIGH FINANCIAL STRENGTH
![Page 45: Strategic Project Selection in Oil & Gas Industry](https://reader033.vdocuments.net/reader033/viewer/2022061211/549369aab4795938608b45c4/html5/thumbnails/45.jpg)
45
Naveen Narayanan
Glendale, AZ, December 8th, 2010