While every sector of the business world is subject to fluctuation from time to time, there’s perhaps no industry more volatile than oil and gas. As consumers, we notice this phenomenon all the time. Nearly every time we stop at the gas station to fill up our cars, we notice that the price of a gallon has moved significantly since last week. Up 15 cents, down 25, back up 40 – the movement never ends.
For industry insiders, these movements are a major cause for concern. When the price of gas changes dramatically, it can have a massive impact on the success of oil companies worldwide.
According to OilPrice.com, 2015 was a turbulent year in the industry. Industry expert Michael McDonald noted that oil prices were on a downward slide for the majority of the year, and most investors and business leaders were eyeing their revenues nervously. They had to worry about liquidity crunches and possibly even wholesale restructuring to their business models.
Price volatility in the industry is a major issue, and there’s only so much that companies can to do combat the problem. After all, if the price of gas is cut in half from one year to the next, you can’t exactly lay off half your workforce and still maintain operations. Often, industry leaders must look for more creative solutions to trim their budgets and remain intact.
One example is making strategic improvements to the maintenance process.
The first step is usually to evaluate or assess your company’s current processes. What are your procedures for work planning, preparation, and scheduling? How are you registering your assets and equipment? Are you cleansing data periodically? For example, how accurate and effective are spare parts levels? How are they synced with physical counts? Even if your maintenance process appears to be running smoothly, there’s always room for added efficiency somewhere.
Top-level executives in the oil industry always have an interest in better strategic planning. Engage with executive sponsors to identify critical business issues. Then, devise project plans to ensure your business focuses on areas that will expedite maintenance and increase reliability. The development of dashboard KPIs, automated reporting to key personnel, and other modern CMMS features can significantly aid the success of these project plans.
Highly qualified, well-trained employees are an absolute must for handling maintenance effectively. Make sure your workforce is skilled in the use of maintenance solutions that maximize efficiency. You may need to perform regular audits or leverage a continuing education tracking resource to ensure that all of your personnel have been brought up to speed and there are no lingering drains on productivity.
To ensure that your business model remains sustainable for the long haul, it’s important to follow up and check on the integrity of your assets. Is all equipment still in good working condition? Are all essential procedures still running smoothly? What efforts are being taken to increase preventive or condition-based maintenance?
Questions, like those posed above, can only help you make the necessary tweaks to ensure that your maintenance is optimized and your oil and gas business is fully prepared to endure whatever the economy brings.