Blog - Scapa Energy

Clients, Capability and Covid-19

Covid-19 Tsunami

The energy industry was in good shape: operators were investing in major projects and acquisitions. There was a good degree of optimism for a period of growth and stability.

How many of us working in this sector truly foresaw how Covid-19 would sweep over us in a tsunami of health and economic destruction in a devastating few weeks?

Until a few weeks ago, Scapa Energy was quietly pleased with the progress we were making with growing the business. We have consolidated our core independent assurance services and strengthened internal capability. We have seen significant benefit from establishing a new Aberdeen office in 2019. This created a great collaboration space, allowing us to be closer to our clients. We started doing business with a range of new clients, including Premier Oil, Serica Energy and Tullow Oil.

We have been fortunate to continue with a number of current assignments providing regulatory, HSE, Operations and Transition Management support. Planned assignments such as independent competence assessments in West Africa, a management system audit in Indonesia and a range of major accident hazard focussed audits in the UK will now mostly be done later this year or possibly next year.

The New Normal

To adapt is to survive. This is very much the motto for many of us. Adapting to the low oil price. Adapting to remote working. Offshore installations adapting to social-distancing as best they can. Adapting to being more creative to support clients and adapting to what is now being called the ‘new normal’.

As an example of adaptation, Scapa recently trialled a remote audit process with one of our key clients. This forced more focus and effort in the planning and pre-engagement phase that required the company being audited to prepare up-front written responses. These responses, coupled with breaking the engagements down into smaller sessions, resulted in a very effective outcome.

An associate asked me this week what the ‘new normal’ really means. The key questions that came to my mind were;

How long will the Covid-19 tail be i.e. how long will the effects persist for in terms of control measures?
What structural changes will be introduced, or remain in place, for the foreseeable future?

These pose both a short and a long term outlook. At least in the short term we can be pretty certain there will be extremely low levels of business travel. There will be significantly reduced office density and sustained home-working practices. Thanks to powerful platforms like Teams, Skype and Starleaf, this has probably been much easier that perhaps thought. Perhaps the image above has some common themes with your home workstation!

In the longer term, and once the threat fades, will we ‘revert to type’ or make structural changes, such as permanent remote working policies, strict travel policies and changed behaviours? And what does this mean for the basic functioning of teams, how they maintain relationships, and how leaders support and influence?

Threat and Opportunity

It has also focussed our minds on our own way of working and forced us to challenge our business model. When the present crisis unfolded, almost in slow motion, I set out clear goals to help prioritise our next steps. This thinking can be seen in the graphic below at a high level.

Source application: www.thebrain.com

As well as the immediate goals of protecting the business and increasing our resilience, it is also important to explore what new opportunities might come about. We have improved our internal ‘way of working’, successfully trialled a new approach to remote assurance and used remote-working technology to best effect.

We will continue to explore new ideas, including the sectors we work in, our ways of working and the services we offer. For example, new visual tools for incident investigation, and building on our site leadership coaching framework.

Of course, the most important input to what we do is our client feedback. We will always seek and respond to all our client feedback and suggestions. Please contact us anytime for a chat (graham@scapaenergy.uk).

Finally, and from a personal perspective, the reduced level of activity has allowed me to reacquaint with some personal interests. I am a little fitter and the garden is in the best shape it has been in for a long time. I hope that you have also managed to re-discover things that may have been neglected for too long. And most important of all, stay safe and healthy.

Featured image:“Working Table” reproduced with kind permission from Mattias Adolfsson; source: https://mattiasadolfsson.com/

What’s New with Scapa Energy

Scapa Energy is very pleased to continue our organic growth over the last year with existing and new clients. This provides a clear indicator there is a continued demand for independent assurance across all aspects of oil and gas, and other high hazard industries.

We strongly believe in taking a different approach to what we do. We embrace complexity in the various domains we operate in, recognising that by taking a systems approach, key insights and barriers to effective performance become clear, whether it is people, culture, ways of working, or technology. This in turn instils deep organisational learning.

The positive feedback from our clients reinforces the value this approach can provide.

New Clients, New Work

We started working closely with Spirit Energy throughout 2018 after carrying out an initial small assignment. Following a detailed gap analysis, Spirit has now adopted a similar major accident hazard assurance framework to that already adopted by other clients. This comprises a range of focussed audits covering major accident hazard topics and includes a high degree of engagement with site-based personnel as well as key decision-makers. Our analysis is strongly based on actual practices, and recommendations are targeted towards realistic interventions that influence front line performance and assure regulatory compliance.

As part of this framework, we have also completed detailed ‘Regulation 5’ audits for our clients. This is a key UK regulatory requirement which places a duty on field operators, and other equity partners, to ensure that outsourced duty holder contractors are effectively meeting their obligations as an installation operator under the Safety Case Regulations.

Scapa Energy has also recently started working with Apache North Sea. They are planning the implementation of a new Control of Work software application. Apache wanted to gain a deep understanding of front-line practices to ensure that any organisational issues did not impact the successful roll out before committing to the technical implementation of the new software. We worked closely with Apache to develop the scope and completed a series of site visits to build a picture of common themes and issues. These findings were incorporated into tangible improvement actions, fully aligned with the software implementation programme.

New Areas of Assurance

Assurance is essential not only for ongoing operations, but for major investments such annual shutdown/ turnaround programmes or major projects. We believe the same principles of systems methods, front-line engagement and leadership participation provides a powerful combination.

Adopting our core principles, we are now providing a range of project and shutdown management assurance services, including Shutdown Lessons Learned Reviews, Shutdown Risk Management services and Critical Path Scenario Planning for a major subsea project. This work has significantly contributed to de-risking these projects.

New Office, New Consultants, New Website

To continue our growth plans, we have acquired new office space in the centre of Aberdeen. This will allow us to work more closely with our client base and provides a central space for our team of consultants to meet and collaborate, as well as an alternative venue for client engagement. The office is located at 7 Victoria Street.

To support the increased level of work, we have increased the size of our team. These new consultants bring with them a diverse range of operational, regulatory and management experience. What brings us together is our shared passion for reducing risk, improving performance and bringing tangible value to each of our clients.

Finally, we also have completed a major website refresh. Have a look to find out more about what we do and who we work with. You can find us at www.scapaenergy.uk.

If you are interested in discussing in more detail what we do, how we can help you, or if you are interested in working with us, we would be delighted to hear from you. Please contact graham@scapaenergy.uk, or stephanie@scapaenergy.uk.

Scapa Energy has been busy…

The last year has been an exciting period with heads down and shoulder to the wheel to meet client demand

This effort has resulted in a steady increase in the range of clients we have, the diversity of projects we are managing, and enhanced capability from our growing team of consultants. With a swing to a positive sentiment in the energy industry, we are looking forward to continuing this path whilst consolidating our core services with existing clients.

With our unique mix of experience and by taking a holistic systems approach, we strongly believe we can make a real difference to risk management and asset performance in upstream and high hazard industries.

In what ways do we achieve this?

Major Accident Hazard independent audit and assurance, focussing on front line operations.
Independent regulatory advice for operators including management of the Well and Installation Operator approval process.
Process Safety leadership, coaching and competency assessment.
Transition Management and Operational Readiness Reviews.
Independent Incident Investigation.

How do we deliver this?

Our team of consultants is a unique combination of senior operational managers and ex-regulators.
We have a hands-on approach to engagement, we know which stones to look under and who to talk to.
Our advice is always impartial and evidence-based.
We take a systems view, avoiding the trap of ‘wood and trees’ and understand the wider business context.

What assignments have we been working on? Here are some examples of ongoing or recently completed work;

Managing and delivering EnQuest’s Major Accident Hazard Audit and Assurance programme, operational Readiness Review process and provision of Transition Management support.
Provision of HSE Audit and Assurance Services for Chevron UK North Sea operations.
Led a successful Well Operator approval process for a newly formed Independent Operator in the UK.
Led Operational Readiness Reviews for new FPSO operations in the UK and Internationally, including the Kraken project.
Completed a number of Process Safety related investigations and provided advice to manage regulatory compliance challenges.
Delivered a programme of Process Safety Leadership and Competence Assessment for Spirit Energy, including operations in Norway, Netherlands and the East Irish Sea.
Completed Safety culture assessments for a variety of European high hazard sites, engaging with front-line and senior management personnel.
Leaning on our regulatory experience, provided Fatal accident Expert Witness services for a UK high hazard operation.
Designed and implemented an HSE Management system for an Independent UK E&P Company.
Completed an Asset Transfer Due Diligence exercise for HSE and Operational areas.

Scapa Energy is committed to efficient and effective delivery of our services with the goal of always increasing client value by working together to; reduce risk, enhance organisational learning and improvement, and achieve regulatory compliance. This is what motivates us as we look forward to an exciting new year.

If you are interested in discussing in more detail what we do, how we can help you, or if you are interested in working for us, we would be delighted to hear from you. Please contact graham@scapaenergy.uk, stephanie@scapaenergy.uk, or have a look at our website www.scapaenergy.uk.

Playing Jenga with Risk

I caught up with an industry colleague recently who wanted to share with me the success his company, Risktec, have had with the introduction of simple game-based scenarios to encourage the workforce to think about major accident hazards and risk in a more engaging way. We talked about Jenga.

This reminded me how effective a Game Metaphor can be as a systems thinking tool to generate new ways of thinking, and in this example, about how we manage risk.

Jenga is not a game of chance, it is a game of choice. When managing risk, and when making risk based decisions we are also choosing what steps to take to make sure the benefits of decisions, and the remaining risk is acceptable to the organisation. We choose which blocks (or safeguards) to keep in play, and which ones may be acceptable to adjust, modify or live without.

Thinking about risk management in terms of a Game Metaphor creates some general features for us to think about;

There is a set of defined rules which all the players agree to follow, and from time to time the rules may change
The players of the Game recognise what it means to do well (win the Game), or do badly (and lose) and each player adopts his strategy based on their own perspective
There will be competition between the players, but all must co-operate sufficiently to ‘stay in the Game’

In our upstream industry, we are overwhelmed with internal rules and external regulation. The new Safety Case Regulations are an obvious example of a rule change, but within organisations, we are on a continuous iterative loop of new or revised internal procedures and processes. Sometimes the rule change allows more Jenga blocks to be removed than previously thought safe to so, think ‘fitness for purpose’ calculations versus more conservative design codes. In other cases, we put so many rules in place, you may get only a few moves in before the game stops, you might think of a few examples from your own experience.

No one of course wants to lose, that is, creating a situation that leads to an unplanned event, whether it affects major accident risks, personal safety, or operational impact. But what does it mean to win? Obviously not to have unplanned events, but depending on your perspective that will also mean no unplanned events and meeting production targets, or meeting a stretch budget target, or to maintain strong regulatory relationships, or to improve operational culture. These goals are not always mutually aligned; a balance must be struck to ensure the right judgements are made to control risk. In ‘Game Playing’ mode, there is a clear advantage to try different scenarios to safely test the impact of removing the next block from the Jenga tower….

However, in daily operations, how aware are we there are many little nudges to the blocks being made, which in isolation, do not appear to have any material significance; but add up all those little moves and adjustments, and you might only be one step away from losing the game. Think cumulative risk, organisational change, a growing trend of deferrals, a tendency to drift towards lower standards, or a complacent culture, as some examples which can weaken the overall resilience of the structure.

If we turn the rules of the game on their head, we can conjure a different approach to risk management. Rather than gradually, and often unintentionally, removing blocks to weaken an originally sound structure without it falling, let’s assume the starting point is a degraded structure with hidden weaknesses and imbalances. From here, the rule could be to add blocks. Over time, and by looking at the Jenga tower from different angles, you gradually build a strong, robust structure which is resilient from knocks and pushes. Now liken this to a strong organisation, management system and workforce moving towards best practice – a winning strategy!

Game-based scenarios can be used in a safe environment to test strategies and decision-making. When we make decisions, we must properly test them in every sense, and every possible consequence before they are implemented. We can change the rules and test the impact, we can see how much better outcomes can be by collaborating between players, and we can recognise the trade-offs between risk, cost and performance.

If we weaken the organisational and systemic structure too far, the consequences are irreversible, the blocks come crashing to the ground. We all lose.

Organisational Learning – room for improvement?

In our oil and gas industry, we have many arrangements in place to assure, audit, learn lessons etc. and continuously improve our operations. Many of these arrangements are driven by regulation or to meet Company standards, as well as improve operational and HSE performance. Unplanned events do occur and we investigate to ensure ‘lessons are learned’. But how effective are all these activities as a means of organisational learning and what more can be done to make sustainable improvements to control risk in our hazardous operations?

Three perspectives which I think offer some insight are;

What do we say we do through our processes and procedures
What do we actually do in practice
What more can be done to improve organisational learning

Taking the first, as an industry we create many procedures, standards, policies, processes, swimlanes, excel registers, databases etc. Each time a new requirement emerges, an incident occurs, or new assets are added, we add to the already burgeoning collection of management system documents. At some point, we all end up moving to a ‘de-cluttering’ exercise!

These are essential tools to manage our business. However, when we undertake creating these documents, how much time and effort do we put in to understanding the perspectives of the end user, the usability of the document, the logical soundness of the processes, the clarity and style of language, and making effective use of graphics and icons. My experience shows a mixed bag; there are some excellent examples out there, matched by procedures that are well in excess of 150 pages, or with flowcharts so complex, you need an algorithm to work out all the possible combinations!

However well or otherwise we capture ‘what we say we do’, what actually happens in practice? Given that the stated purpose of any procedure is well intended, the expectation must be that well intended actions follow. Given any improvement to a procedure or process, equally we should expect improved performance. And given that we audit, verify and assure these processes to check they are effective, we should, after identifying gaps to close, have effective processes that work in practice.

But there are many situations where a gap persists between procedures and practice. Following an incident, how often do we see the root cause of ‘procedure not followed. Or, during an audit, in answer to the question ‘are you aware of this procedure’, the answer is often in the negative.

Whether the activity is proactive assurance, or investigation, the findings from these must be the kernel to organisational learning and improvement. This raises two other questions – are the findings robust, and how well are these findings implemented?

Too often, findings and recommendations are ambiguous, open ended, or confusing. Increased rigour, competence and governance to create targeted, value adding SMART actions is essential.

When actions are entered into the organisation’s action-tracking system, is there clear accountability through the life of these actions, all the way through to checking if the action has actually made a difference? Is the learning loop being closed?

When organisations adopt ISO standards, they are couched in PDCA models, ‘non-conformances’, and other such quality oriented terms. This can add to the theory-practice gap because the language of Quality is often incongruent with day to day oil and gas operations. This does not make for an effective ‘learning system’.

What more can be done to strengthen the organisation’s learning effectiveness? Perhaps a first step is to look at what the learning process is. Deming’s PDCA continuous improvement cycle has been in use over a long period, driven from a manufacturing viewpoint where we;

Plan a better way of improving a product (or process)
Implement (Do) the improvement
Check if the improvement has worked (Deming called this a Study step)
Take further Act(ion) to improve again, and so on in a cycle

An alternative model is offered, where we;

Engage with end users and observe behaviours in practice, compare these experiences to the expectations defined in company processes.
Reflect on what is driving any differences in practice, what are the underlying themes from a cross section of perspectives, what are the soft issues, are there any feedback loops setting up certain types of behaviour?
Form a clear view on what the essential themes (or models) are that drive practice and what improvement actions might make a difference. Check any assumptions being made.
Validate these key improvement actions with those who will be affected, test how they will add value, and implement through a robust change management process, and we return then to the first step.

This learning process (introduced by Kolb, 1984), takes account of people, their unique perspectives, and the importance of taking time to reflect and identify underlying themes.

Kolb (1984)

How does this translate into our fast-moving dynamic, complex and unpredictable energy industry? This suggested approach, a systems approach, is not complex or time-consuming. It is necessary however to think and plan a little differently. Rather than only getting involved at low levels of detail and looking at component level, also stand back and observe the wider behaviours in the workplace. Rather than think of events in isolation, look at the feedback loops and other inter-relationships which have caused the event. Rather than assume people will comply with a process, engage with the key users, go to their operating space and really understand their perspective. Get them involved in shaping business processes.

Organisational Learning using a Systems Approach such as this is expertly introduced in Peter Senge’s ‘The Fifth Discipline”. A recommended read for an introduction to systems thinking in organisations.

With this approach, more effective interventions are possible, personal ownership for improvement will be more likely, and in the long term, more effective organisational learning, and a safer and more efficient operation!