Lean Six Sigma — Oil and Gas Industry
Lean Six Sigma is a methodology for improving business functionality and increasing efficiency. Six Sigma’s main goal is to implement a process that systematically eliminates inefficiency and defects. Six Sigma is a set of quality management methods that employ statistical data and the development of a special infrastructure of people within the organisation known as “champions.”
Every Six Sigma project is carried out as part of an organisation, in a predefined sequence, with quantifiable financial goals. Overall, Six Sigma is customer-centric, with the primary goal of providing value, dependability, and high performance to the customer. Six Sigma is now widely used as one of the major themes in Total Quality Management (TQM).
Lean Six Sigma is frequently associated with manufacturing processes, but its applications are applicable across all industries, regardless of process type. Lean Six Sigma methodologies have resulted in significant changes and value additions. This is true in the oil and gas industry.
The oil and gas industry are a vital one that has a global impact when there are fluctuations in any process, inconsistencies in the supply chain, and so on. A significant portion of these challenges revolve around innovation, unforeseen environmental conditions, price volatility, and the implementation of methodologies to improve overall output with minimal waste.
Lean Six Sigma provides ground-breaking opportunities and analysis to help achieve this goal.
Lean Six Sigma focuses on maximising value for customers while using as few resources as possible. This process necessitates a focus on defects in products or services, as well as the elimination of waste, as waste management is essential for an efficient process.
This necessitates gathering information about the current process, analysing it, comprehending how the process works, and then identifying flaws and waste. Lean methodologies help you understand the process and critical work of implementing changes, resulting in overall improvements. It also includes methods for continuous improvement, such as determining when the next round of changes is needed and measuring the effectiveness of changes.
Simply put, Lean Six Sigma breaks down a complex process into simple, scalable parts, making the overall process of improvement easier and more effective.
There are numerous well-known examples of businesses that have achieved spectacular results and effectiveness by implementing Lean Six Sigma methodologies. General Electric, Toyota, Motorola, 3M, Amazon, and Boeing are among the well-known companies that use and benefit from Lean.
Why do Lean Six Sigma and the Oil and Gas Industry work so well together?
Over the years, Lean has a proven track record of effective and successful implementations across industries. This has broadened its methodology, which is filtering down into industries such as healthcare and oil and gas, transforming how these venerable companies conduct business. The energy industry is becoming more Lean as a result of a lack of standardised guidelines as well as a heavy reliance on machinery and various processes.
Market conditions change
One of the primary drivers of Lean Six Sigma adoption and application in the Oil and Gas industry is the ever-increasing demand for and production of oil refinery plants around the clock. Oil and gas companies must be more flexible and agile to succeed in an industry that is plagued by price volatility, technological innovation, and an uncertain regulatory environment.
Many oil and gas companies are hesitant to implement a standardised and continuous improvement method due to these unfavourable and ever-changing conditions. However, when these methods are used thoughtfully and with a long-term perspective, they can have a huge impact on the production and supply chain. As a result, the Lean Six Sigma model is gaining traction in the oil and gas industry.
Targeted Enhancements
One of the primary goals of the Lean mindset is to simplify and break down the process in order to gain a better understanding. Because the oil and gas industry are inherently complex, simplification is difficult; however, Lean methodologies provide a framework for keeping the process, its function, and improvement within a controlled zone. This greatly simplifies and improves the efficiency of the process.
Capital Improvements
Because the oil and gas industry are constantly changing, almost every company that works in it has a new objective, a new goal, new people, and a new mindset. This can also happen in existing businesses because new capital projects require changes, which can result in a new set of challenges and a completely different learning curve. This makes it difficult to maintain or improve the performance of processes or the entire organisation.
One way to address these issues is to use project data and leverage it to understand the issues or causes of faults, defects, and so on. However, there is no procedure, and the data available is dispersed, making it almost useless.
Standardization of data and its storage can be accomplished by using the Lean approach and creating a repository, which allows one to build on what is learned during each capital project. This will also allow all employees and executives to monitor project progress in real time from any location.
Manufacturing of Equipment
Manufacturing firms face fluctuations in market demand, but those producing equipment for oil and gas companies face a variety of challenges, including legislation, political interference, foreign policy, logistics issues, and discoveries.
Furthermore, oil and gas manufacturing companies create sophisticated equipment in varying quantities and custom configurations. Because most of the equipment is not repetitive, it has varying defects, etc.
The lean approach is extremely beneficial in the oil and gas industries and can be applied to individual processes, assets, or the entire organisation. It assists an organisation in achieving its ultimate goal of having a safe and efficient process with no delays. Another significant advantage of using Lean methodologies is that problems become visible, making it much easier to correct them.
Lean Modelling for Oil and Gas
Adopting Lean methodologies in the oil and gas industry necessitates a thorough understanding of the processes’ principles and what drives them. One cannot simply replicate the successful implementations of GE, Toyota, 3M, and others, because Lean Six Sigma approaches problems or issues with a new way of thinking, rather than with new tools or old tools integrated with new ones. Furthermore, if the results are copied, they can be random and difficult to maintain continuously.
As a result, leaders must embrace both the principles and practises of Lean Six Sigma and ensure that the approach is viewed as a system of improvement focused on identifying and resolving the organization’s most pressing problems. This replaces the old way of working with complicated signals, gut feelings, top-down management chains, and so on, and provides a simpler, more scientific way of working that improves overall functioning, production, and supply.
KPMG Lean Six Sigma Training program Offerings:
· Lean Six Sigma Green Belt Certification Training
· Lean Six Sigma Black Belt Certification Training
· Lean Six Sigma Master Black Belt Certification Training
· Lean Six Sigma Programme Schedule
For KPMG Six Sigma Training registrations and enquiries,
· E-mail: in-fmsixsigma@kpmg.com
· Call at: +91 9555688555 or +91 9022033666
For corporate enquiries:
· E-mail: in-fmsixsigma@kpmg.com; Call at: +91 9987744776