This paper examines the organizational and cultural challenges facing the RasGas Subsurface Group, a joint venture between Qatar Petroleum and ExxonMobil operating the world's largest non-associated natural gas field. The paper identifies poor technical integration, siloed communication, and an antiquated top-down management culture as the primary impediments to effective operations. Using systems thinking and soft systems methodology, the paper analyzes these issues through two dominant metaphors — culture and brain — and applies the CATWOE framework to map stakeholders and transformation processes. The paper concludes by applying Peter Senge's five disciplines of a learning organization — personal mastery, mental models, shared vision, team learning, and systems thinking — to recommend structural and cultural reforms, including the formation of Asset Surveillance Teams.
The North Field is the world's largest non-associated gas resource. In 2010, this national asset of the State of Qatar supplied 25–30% of the world's liquefied natural gas, of which RasGas, a joint venture between Qatar Petroleum and ExxonMobil, delivered approximately half. From 1999 to the present, RasGas grew from zero standard cubic feet of production per day to 9 billion standard cubic feet per day, along with greater than 300 kbd of natural gas liquids, and built the infrastructure of the world's premier LNG value chain. Proprietary producing wells are at the start of RasGas's recognized world-class LNG value chain. Their performance enables each subsequent link in the chain and sustains billions of dollars of present and future investment.
World-class wells are not the inevitable outcome of a world-class reservoir. Innovation, integration, and execution are central to the way RasGas is organized and managed. Innovation is an important key to success because it not only improves company outcomes but also increases the certainty that RasGas assets are delivering maximum value. Innovating while executing requires a high degree of integration — something that does not come naturally to most joint ventures. The RasGas collaborative internal framework, which includes synergy, systems, and comprehension, is vision-driven and creates the necessary opportunities and structures to continue providing both a world-class product and equally effective customer service. Integral to world-class performance is consistent shareholder support of new ideas and the innovation needed to achieve strategic objectives. In addition to providing secondees, ExxonMobil contributes a powerful technology base and proven worldwide expertise. Additional community partnerships are maintained through colleges and universities.
RasGas operates a systematic framework required to integrate many elements simultaneously: people, systems, tools, and numerous other components integral to the successful continuation of an international business responsible for supplying fuel to the world market. Innovation is an essential quality for the continued success of RasGas in carrying out this important service. Though consistent and reliable frameworks are necessary, innovation is also required to meet the growing and changing demands of the market as well as the inherent variability within a multi-organizational base. Where many other organizations can rely on a status quo, no such comfort is available in the volatile world of natural gas drilling, processing, and distribution. For a venture of this scale — and particularly because it is a joint venture — successful communication, allocation of tasks, leadership, interdepartmental understanding, clear definition of responsibilities, and effective sharing of information between departments are all crucial.
Failure to be comprehensive represents a loss of opportunity. In the well delivery arena, special care has been taken to ensure comprehensive functional coverage. This coverage systematically deploys expertise and innovation across the full continuum of well construction milestones: drill, complete, and produce. For example, even as RasGas reached its development plateau of 9 billion cubic feet per day, the resources devoted to well-related research studies did not diminish. Rather, the focus shifted from developing production to sustaining it.
In the functional area of well reliability and gas deliverability, RasGas created an accountable organization of specialists. One such group is the Subsurface Group (SSG), which manages the reservoir and the well life cycle. It comprises approximately 1,200 people including rig operations, vessels, secondees, contractors, and direct hires. The SSG is staffed with experienced reservoir, petroleum, production, and planning engineers, production petrophysicists, business support and business process professionals, and a younger national workforce. It is divided into several departments with clear roles and responsibilities that mesh together to complement the other departments and groups within RasGas, creating the synergy necessary to deliver the potential of the reservoir and long-term, reliable gas deliverability from its wells.
The core problem is poor technical integration among the Subsurface Group's sections with regards to overall goals and objectives. The RasGas Subsurface Group consists of multiple departments, each comprising several sections based on functional discipline. The overarching goal of the SSG is to effectively manage all aspects of gas supply related to drilling, completion, and reservoir management activities so as to be considered the operator of choice by shareholders. This goal can only be achieved if there is clear alignment and collaboration between departments and sections. However, in the period under review, several problems arose resulting in sub-optimal operations, additional cost, and a negative impact on the image of the entire group.
These problems include the following:
Fragmented shareholder communication: Individual sections at times communicated independently with shareholders, often with different messages. During operations, the Petroleum Engineering, Reservoir Engineering, and Well Management departments each communicated results back to shareholders separately rather than sending one unified RasGas response. This confused shareholders and increased the time required to obtain their direction, which in turn led to delays in getting instructions to the rig, adding time and cost to operations.
Backlog of analyses and reports: Analysis and final reports for gathered data were not generated in a timely manner because various sections believed this was someone else's responsibility. This led to a very large backlog of analyses and a loss of confidence by shareholders that RasGas could provide reports on schedule.
Failure to share findings: Findings tended not to be shared between sections, resulting in missed opportunities for enhancement.
Poor interdepartmental working relationships: There was a tendency toward poor working relationships between staff from different sections due to the independent objectives of each section. This led to unhealthy competition and occasional subversion.
Serial rather than collaborative work products: Work products were generally created in a serial fashion, with one section handing off to the next with little or no collaboration. Section members tended to understand only their portion of the work product and had little motivation or interest in understanding the whole.
Unresolved debates before shareholders: Staff members would often debate issues with each other at key shareholder meetings instead of presenting a unified RasGas position. This led to a loss of confidence by shareholders in RasGas's technical capability.
These problems stem from an antiquated top-down management style within the Subsurface Group. A culture developed that did not promote integration, collaboration, or teamwork. Consequently, the SSG has, on occasion, failed to meet shareholder expectations in fulfilling its drilling and reservoir management obligations.
One solution to the lack of integration is the formation of multi-functional teams — Asset Surveillance Teams (ASTs) — whereby representatives from each functional section are brought together. This approach greatly improved collaboration and sharing of information, resulting in improved work products, greater efficiency, and renewed shareholder confidence. However, the formation of ASTs alone was not sufficient to improve integration. A cultural change was also required in the way staff approached their work. Under the AST culture, staff was expected to take less direction from their individual function and instead work with counterparts from other disciplines to proactively solve issues.
As a result of the old-style management ideology in effect, the departments and sections of the Subsurface Group tended to be isolated. Staff was expected to work only on items and issues related to their own discipline and were generally discouraged from concerning themselves with other disciplines. Although departments needed to work together to achieve organizational goals, at the individual employee level they were not working cohesively. This environment of divisiveness and individual competition was ultimately counterproductive to the attainment of production and expansion goals (Wolfram, 2002). Culture is identified as the dominant metaphor because the systematically developed culture of RasGas is the primary impediment to effective management of employee and team development. Because the environment is one of competition rather than coordination, there is no unified front to present to shareholders, and key assignments and processes are either not completed or completed in a sub-par manner. It is the culture of the corporation that must ultimately change before significant improvements in performance and overall output can be observed.
Trust: Sections contain one type of engineering discipline and do not readily trust members of other sections, leading to duplication of work and the seeking of multiple redundant opinions. Sections and their managers appeared to experience the silo effect. This lack of trust also conveyed a disorganized front to shareholders (Ackoff, 1981). If different departments were unable or unwilling to work together, shareholders could not trust that they represented the most effective and efficient choice for continued investment.
Communications: Overlaps in ownership and reporting led to typical communication problems, with many vested stakeholders each pursuing their own interests and priorities (Ackoff, 1981). The spirit of competition also negatively impacted the manner in which employees communicated. The lack of specific role definition, combined with a highly isolationist company mentality, ultimately resulted in a communication breakdown that prevented the effective running of the company.
Knowledge Sharing: Mentoring and cross-training had been declining, leading to reduced knowledge-sharing and fewer familiarization opportunities for younger, less experienced staff. Section members lacked the opportunity to share knowledge and lessons learned. This enforced specialization will ultimately result in poorer outcomes. Cross-disciplinary work is essential for the successful integration and most efficient use of employed experts (Forrester, 1971). Without it, reaching a favorable outcome could take months longer — if a truly effective outcome is reached at all.
Compartmentalization of Data and Ideas: Silos of information existed that were not readily communicated across departments (Richmond, 2001). This mentality ultimately hinders progress. Employees within a unified organization must be both able and willing to share information across departments in pursuit of the most favorable outcome for the organization as a whole. In an organization where managers are seen to be competing amongst themselves and interdepartmental cooperation is neither encouraged nor enforced, an environment of freely flowing information is unlikely to develop.
Coordination and Interface Management: Coordination between the SSG, Operations, Venture, and other RasGas groups is extremely critical in such a dynamic environment for meeting key deliverables from each group and identifying potential optimization opportunities. It is necessary to create opportunities to address the right balance of projects and to respond to immediate and future shareholder needs, taking into account the multiple ongoing projects.
Value was placed more on achieving individual performance objectives — or at best only section objectives — rather than overall RasGas strategic objectives. Staff tended to follow the traditions of an old-style, non-integrated work environment in which individual achievement superseded team achievement (Ackoff & Emery, 1972). Section and department managers tended to follow existing rituals and did not lead by example. They were often observed engaging in infighting instead of promoting collaboration and teamwork.
There was a general lack of communication between departments and between sections. Each section tended to work independently from the others, effectively leading to distributed control. Staff worked with the mindset that they only needed to be involved in work activity related to their own discipline. Each section had well-defined duties, so that from the department-level perspective, parallel information processing was taking place (Ackoff, 1981).
Task Definition: No production activity descriptions or production standards were defined or followed. There were no common grounds for data analysis or agreed priorities, and no common surveillance program. Clear and concise task definitions are essential for more efficient activity and for ensuring accountability (Churchman, 1971).
Accountability: Accountabilities for surveillance and production activities were unknown or misunderstood. Ownership was not fully defined, and sections had not agreed on who was responsible for which tasks, resulting in misunderstandings about who would perform the work and when it would be completed. Decision-making and common goals were not addressed for new and missing activities. Without accountability there is less motivation for precise and timely work (Gleick, 1987). There is also an increased likelihood that important aspects of jobs will be overlooked, as each party assumes another will handle them. In such circumstances, it becomes impossible to assign specific responsibility, to correct the mistake effectively, or to prevent it from recurring.
"Stakeholder roles and transformation process mapped"
"Soft systems methodology and five core principles"
"Senge's disciplines applied as reform recommendations"
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