July 2019


Viewpoint: Asset performance management: Into a new era of organizational memory

It is often said that knowledge is power. But in high-risk sectors, such as the marine and oil and gas industries, knowledge is fundamental to even more important things: safety and reliability.

Stuart, J., Lloyd's Register

It is often said that knowledge is power. But in high-risk sectors, such as the marine and oil and gas industries, knowledge is fundamental to even more important things: safety and reliability. Hard won through experience, knowledge is the difference between profitable operations and unreliable equipment at risk of failure from factors such as corrosion, human error, and fluctuating operating conditions.

The problem is that it is becoming more difficult than ever for companies to retain that critical knowledge and experience within their organizational memory. An aging workforce means a more dynamic job market, with engineers more likely to hop between companies. Increased merger and acquisition (M&A) activity and a common inability to retain talent also contribute to the decline of a settled workforce that can accumulate and pass on organizational knowledge over many years.

Furthermore, new technologies promise to change working practices and, therefore, change the nature of skills and knowledge that tomorrow’s operators will need. This leaves asset operators to maintain a delicate balancing act: retaining/capturing invaluable knowledge of the past and making it usable and useful, so that future works can build on this knowledge to more rapidly improve productivity.

Technology, specifically asset performance management (APM) solutions (and especially those with a focus on risk, reliability and optimization aspects and mitigation strategies) will be central to owner/operators as they enter a new era of organizational memory.

Retain and maintain

In the energy sector, the looming “great crew change” is a considerable source of anxiety. An aging workforce, coupled with a spate of early retirements during the downturn, leaves the industry reliant on fewer and fewer seasoned experts for their years of knowledge and experience. Even if a huge influx of young workers were to come into the sector tomorrow, comprehensive knowledge transfer would be impossible before this knowledge was lost to retirement.

At the same time, the gradual upturn in the oil and gas sector has led to a matching uptick in M&A activity. While it is heartening to see renewed activity levels and investment in the sector, M&A deals often lead to workforce changes, and a real risk exists that experienced workers will view the event as a good time to retire or seek opportunity elsewhere.

As such, owner/operators are faced with two seemingly opposite trends—one born of the downturn, the other of the upturn—both of which put pressure on organizational memory. When it comes to APM, these are the skills, experience and know-how that can keep assets running optimally. If too much of that knowledge is lost, there is increased risk of major equipment failure that can impact human/environmental safety and the reliability and profitability of high-value equipment.

APM solutions can go some way toward mitigating this. Traditionally, these solutions have excelled with quantitative, easily digitized data that could be used to aid asset owner/operators decision-making processes. However, the new generation of APM solutions has been designed with the changing workforce in mind. These solutions have been developed to better capture the more qualitative, more human elements of knowledge, experience and best practice that might otherwise be lost. APM solutions help rapidly deploy this knowledge to augment newly developed insights or expertise.

APM does this by enabling engineers to map their understanding of failure mechanisms and failure causes, and then sense-check their models against a rich library of information. This qualitative input can then be codified and added to the solution, enabling a systematic approach to capturing human knowledge and best practices, all in one place and accessible across the organization.

Capturing this knowledge goes hand-in-hand with the need to deliver assurance and confidence to plant managers and operators alike. Digitizing expert knowledge and best practices is a key component of what Lloyd’s Register terms asset performance assurance, and it lies at the heart of its AllAssets platform.

In most organizations, the executive team relies on operations and maintenance staff to assure them with high confidence that risk of an unplanned shutdown is minimized, so that production forecasts are met, plant performance is continually improved, and preventive maintenance work is scheduled at the least disruptive/most economically beneficial time. Modern APM systems that embody this concept of asset performance assurance enable teams to deliver exceptional knowledge-based asset performance strategy with a high level of confidence.

Building the knowledge base

By capturing and codifying workers’ knowledge and experience, APM systems retain critical knowledge capital and make it more useful to the company as a whole.

A seasoned engineer intimately acquainted with a particular asset and its operating conditions and maintenance/inspection activities is well placed to pass on that knowledge to a handful of colleagues. But what happens if the operator runs similar assets elsewhere around the world? A forward-thinking company might look to send the subject matter expert to other sites to provide training, broadening the knowledge base. However, this is still a fundamentally analog and limited method of knowledge transfer.

By effectively capturing that experience digitally, workers across the world can gain access to pertinent knowledge through the APM system, as well as augment the pre-programmed risk models with their own knowledge and experience. In doing so, organizational memory is not just preserved—it is also enhanced and made more useful.

In fact, such benefits are not limited to individual companies. At the asset owner/operator’s discretion, the APM provider can capture and anonymize the knowledge to provide benchmarks for similar assets to other owner/operators in the industry. This democratic, collaborative approach can improve best practices across maintenance, inspection engineering and operation. The results are reduced equipment failure, improved productivity and longevity, and better business performance across the industry.

Preparing for the future

At the same time as trying to maintain critical, existing knowledge in the organization, operators are also faced with the need for new knowledge and skills in light of technological change.

Across sectors, economic activity is becoming increasingly automated and digitized. Buzzwords such as the Industrial Internet of Things (IIoT), Industry 4.0 and “smart” components and systems all point to a fundamental shift in how assets are designed, built, installed, maintained and operated. Although industry veterans’ knowledge will undoubtedly be needed to maintain legacy equipment with decades of useful life remaining, tomorrow’s assets will require a different set of skills to run and optimize. Programming, cybersecurity, data science and analytical skills will become far more prominent.

Tomorrow’s best-in-class APM systems will be capable of combining promising new technologies with the benefits wrought from hard-earned human experience and skill—in other words, marrying mature and new knowledge to upgrade not just organizational memory, but also how this memory is applied. Those operators that succeed in doing so, aided by APM technology, can confidently step into a new era of asset performance assurance. Those that do not may find that the aging workforce outlives their company.

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