The Inevitable Information & Knowledge Blowout
This is a wakeup call that may rattle a few cages but it needs to be said:
Your company’s information is a well. It’s exactly like an oil well …and no matter who you are… your company is about to suffer a blowout.
The blowout might be small or it could be massive, but make no mistake you will have a blowout and lose a lot of valuable knowledge. It doesn’t matter how great your company is or how incredible your people are; you WILL have a blowout.
What are we talking about here? The most valuable resource your company has and its biggest target for others is your well of information.
Let’s Look at The Current Situation:
The energy market is slowly coming back to life after a 2-year downturn. During that time, the industry has lost some of its best people. More than half of those workers have said that they will not return to the business. The existing workforce is aging, with 50% retiring over the next 5 years. For every two Oil & Gas workers retiring, only one is coming into the workforce.
At least half of the people who really know how to do their jobs (experienced workers) are leaving over the next few years and they are taking their knowledge and experience with them when they go.
We also have fewer and fewer young workers entering the wonderful world of Oil & Gas. When they arrive, how long will it take them before they can actually do their job and be able to do it safely or be autonomous in their roles?
Once you start doing the math, you realize that a crisis is about to hit. This is not a “challenge” … it is a full blown crisis. This isn't about ups and downs in the market. It's about the massive loss of knowledge that will never come back.
Let’s Define the Blowout and Why It’s Guaranteed to Happen:
The blowout that your company WILL have is the millions and millions of dollars’ worth of knowledge and experience that will walk out your front door each time one of your people retires or gets recruited by your competition. There is no escaping this fact. I don't care who you are; it will happen and it will happen to your company.
The better your people are, the more likely they are to be pursued and recruited away. While I haven’t been a part recruitment for years, I spent several years leading headhunters in Oil & Gas and I’ve trained many teams of recruiters how to identify and steal YOUR best people. As we speak, those recruiters are preparing to make a lot of money over the next few years by taking your best people. (As well as their knowledge)
The other contributing factor is retirement. It’s inevitable and unlike the last boom, companies wont be able to fix the problem by throwing money at it. There won't be enough experienced people to do the jobs, regardless of how much money is in the hiring budget.
The Cost of the Blowout: (Bill the Drilling Manager)
It’s hard to put an exact value on the knowledge and experience in a person’s head, so let’s approach this using only the minimum figures. This might help to make us feel better about the cost of the blowout.
First, let’s look purely at the cost of attrition and replacing an experienced worker. The national average for attrition cost for a professional worker in the United States is 200% of base salary. (In Oil & Gas this number climbs to between 300-400% of base salary.)
Let’s say that Bill the Drilling Manager (with 25 years of experience) has been recruited away. Bill made 175K USD per year so, we’ll use $350K as a minimum figure for Bill’s attrition cost. This is assuming that we can replace Bill pretty quickly and that projects haven’t been put on hold or slowed down from his absence. Any down time or delay could cost us more. Let’s also hope that there are no safety incidents because that would really drive up the cost of this knowledge blowout.
Let’s hope that whoever took over Bill’s job really reads the whole manual and memorized everything we taught them in our training classes. People never forget things that they learn in training, so we should be fine right?
After all, we have those PowerPoints and Visios for our young engineers and those will be just great. Young workers love the dynamic and interactive nature of those manuals and PowerPoints.
Well don't they?
If you're still reading this scenario, you’ve probably realized that losing Bill and his knowledge could make this Knowledge Blowout much more expensive than the cost of Bill’s attrition.
The Blowout Preventer:
Obviously, you need a BOP (Blowout Preventer) on your company.
MindXtract builds Intelligent “BOP’s” with AuraPortal's unique technology.
Let’s look at what an Intelligent BOP needs to have in order to be effective:
The BOP must be able to prevent the loss of knowledge from your well and be able to fully capture, contain and transfer your company’s most critical information in real time. The BOP must capture not only how something is done but why. Again, the SME understands nuances and contingencies not readily captured in process maps or slide shows. The BOP must be able to evolve in real time as information and practices change.
Whatever your system of managing your company's information and processes, it should be able to be updated quickly and easily or the process will either slow down innovation or be by-passed by an undocumented “better way”. It must be interactive and portable: a young engineer, for example, must be able to pick up an iPad on a job site and be able to instantly access the information required to complete a task and understand why that task is done a certain way. It must also be able to access and interact with data across your entire enterprise in real time.
The alternative to an agile and intelligent system is to have the SME readily available for questions – something that can’t always happen. The BOP must be able to provide instant information that is compliant with regulations, company policies and safety standards in real time. This is a gold-star trait of a well thought-out "BOP" – the information is vetted through interested parties prior to being published. Finally, it would be wonderful if the BOP was able to measure performance and provide feedback to users.
Luckily, our company's solution does all of those things and more. Ours is actually the only solution that will meet all of the criteria detailed above. Ours is also the ONLY solution that allows companies to make changes to their processes in real time with zero coding. It's also the only solution that provides you access to every piece of software in your enterprise with a single log in.
No one else has our technology and it's already making waves quickly in Oil & Gas.
Manuals, PowerPoints, Visio presentations and Business Process Management software tools are great but they won’t prevent a knowledge blowout. They are as effective as completing a well with duct tape.
It may be time to review your company’s preparedness and consider your ability to not only create an agile and informed workforce but you may also want to take a look at the technology that makes it all possible.
It’s your well and it's already leaking.
Have you got a "BOP" in place? If not, we can build an Intelligent "BOP" for you.
Let’s hope the upcoming blowout won’t be too severe for the industry.
Matthew Hiller
Vice President
MindXtract
Matthew Hiller
Vice President
MindXtract
mhiller@mindxtract.com
+1 832 570 4673