Managing Knowledge ManagementPARTICIPANTS:Erik ÅbøStatoilStavanger, NorwayLesley ChipperfieldShell International E&PRijswijk, The NetherlandsChris MottersheadBPSunbury on Thames, EnglandJohn OldTexacoHouston, Texas, USARodulfo PrietoPetróleos de Venezuela S.A. (PDVSA) Caracas, VenezuelaJeff StemkeChevronSan Ramon, California, USA MODERATOR:Reid SmithHouston, Texas Oil and gas companies have varied approaches to sharing knowledge. Experts from six E&P companies discuss experiences in establishing knowledge-management infrastructures—what they’ve learned to date and what the future may hold.Moderator, Reid Smith,Vice President, Knowl-edge Management, Schlumberger:Many companies develop knowledge manage-ment programs in response to key issues or aparticular event within the organization. Whatbusiness drivers are behind your knowledge-management efforts, and what are your compa-nies trying to achieve through knowledgemanagement?Lesley Chipperfield,Manager of Organiza-tional Performance, Shell International E&P:Our start in knowledge management began withthe major reorganization of Shell in late 1995 andearly 1996 when we started transitioning from agroup of globally dispersed companies that werenot linked to a globally connected company.Before that, the companies didn’t talk directly toeach other, and if they did, it was through servicecompanies. Reorganization mandated that we dothings differently and required a cultural shift.Many of the initiatives to start sharing knowl-edge were kicked off in 1996 and 1997.Management recognized that good things werehappening and, in 1998, my group was formed topull together these divergent, entrepreneurialknowledge-management efforts, which hadactually fragmented us. Trying to leverage bestpractices helped establish our current direction.Chris Mottershead,Technology Vice President,Lower Carbon Growth, Global Business Center, BP:BP started knowledge management in the drillingorganization in 1992 or 1993 with training andlearning. The average driller must make quickdecisions “on the go” and has considerably morepersonal accountability sooner than other disci-plines. As a result, drillers seem more willing toask for and accept help, and they are particularlyreceptive to new ideas. Like other companies,our organization was no longer centralized.People couldn’t perform well unless they couldengage their peers and get help that previouslyarrived with authority from the corporate office.They had to share information.In 1994 and 1995, we started evaluating howto improve virtual teamworking (VT). A camera onevery desk let you see the person you were talk-ing and working with long distance. In the NorthS ea, we established pilot VT programs withinbusiness units like the Miller field area. Initially,the objective was to improve onshore and off-shore communication. In the Andrew field busi-ness unit, we used VT to connect the variousdisparate activities of multiparty constructionprojects. Then, we connected the executive man-agers in our worldwide upstream businessthrough VT to avoid regional isolation. This wasremarkably successful, but once we got a globalorganization going, this type of hardware wasn’tneeded anymore.Outside BP, knowledge management seemedto be grounded more in lessons-learneddatabases, which consisted of information thatno one really wanted, hidden away in computerfiles that very few people knew how to access.We created a knowledge-management team in1995 or 1996. Our chief executive thought knowl-edge management was important and still does,so it received much attention. For about twoFor help in preparation of this article, thanks to DennyO’Brien and Justin Rounce, Sugar Land, Texas, USA. Lotus Domino, QuickPlace and SameTime are marks of Lotus Development Corporation. Microsoft Project and NetMeeting are marks of Microsoft Corporation. SiteScape is a service mark of SiteScape, Inc.years, th i s team d i d groundbreak i ng work to define knowledge management, look for best practi ces, parti cularly from the U.S. Army, and build relationships.The strength and success of knowledge-management efforts depend on how broadly you bu ld the network. In th s case, t was qu te extens ve and ncluded people w th academ c and practical experience. The end result was five or s i x knowledge-management nuggets that remained only with the 12 or so people on that knowledge-management team. When we merged w th Amoco, d fferences between the two companies were so minor that it was almost surreal. They had 12 people in knowledge man-agement; we had 13 or 14.We thought there was a dangerous percep-t i on that the only people do i ng knowledge management were i ns i de the knowledge-management team, and unless you had the r help, you weren’t doing knowledge management, which clearly wasn’t true. With a staff of 25,000 technical people, most of the value comes from knowledge they apply daily. Believing that 12 or even 26 people were goi ng to reach the enti re technical staff was unrealistic, so we dispersed this team back into the business units in 1999. That strategy was successful because values and acti vi ti es added by thi s team up to that poi nt were transfused back i nto the organi zati on. A group with two or three members from the origi-nal knowledge-management team was ma i n-ta ned to support the exchange of knowledge between not only d i fferent geograph i es, butother business groups as well.Chris Mottershead,BP:Like other companies, our organization was no longer centralized. People couldn’t per-form well unless they could engage their peers and get help that previously arrived with authority from the corporate office. They had to share information.Jeff Stemke,Knowledge Management/ Collaboration Consultant, Chevron:We got into knowledge management in the early 1990s as an outgrowth of the quality movement. The primary issue for us was cost reduction. We looked outside the company and saw that our cost per barrel was out of line. The idea of look-ing inside and outside the company for best prac-tices grew out of quality initiatives to reduce costs. We identified some breakthrough quality projects that touched broad processes like energy and project management, refining opera-tions and drilling and put teams together to tackle those initiatives. They did some wonderful work pulling together best practices.For example, we developed a world-class pro-ject-management process. Our refineries went from six or eight regional fiefdoms to an inte-grated organization that understood the need for sharing operational knowledge. That work occurred from 1992 to 1995. We made progress and had success, but the results didn’t stick because these efforts didn’t focus on looking for and sharing best practices as the standard way of doing business. A good example was Y ear 2000 (Y2K) preparation. We had to look at embedded systems and understand their impact from a Y2K perspective. In a knowledge-sharing organization, you would think that various groupswould pool their knowledge, but that didn’t hap-pen right away. It took some time.We reached a plateau because knowledgemanagement wasn’t embedded in our business.Our new CEO, Dave O’Reilly, has always appre-ciated knowledge management, but he puts it ina different context by talking about five strate-gic intents for the company. Many companieshave similar business strategies, such as oper-ating excellence, cost recovery, capital steward-ship and profitable growth, but he introduced afifth, organizational capability—our ability toexecute the other strategies. It includes learn-ing from each other, reusing what we know andworking effectively in teams. We’re still defin-ing the key elements of organizational capabil-ity, but they closely resemble the components ofknowledge management.Rodulfo Prieto,Exploration Project Manager,Petróleos de Venezuela, S.A. (PDVSA):In the late 1980s, PDVSA started with quality andother issues that focus on business processes andsharing these processes, which was quite effec-tive because it defined the workflow for manyactivities. Most of the time, geologists operate inthe arena of mental creation. Mental creation isimportant, especially at the beginning of projectsbefore commitments are made. When the threePDVSA affiliates merged in 1998, it was impor-tant to create an organization that combines tech-nological competencies and information throughwhat we were calling knowledge management.We like the term “knowledge” because it empha-sizes the mental-creation phase of every project.It implies working at the highest level of technol-ogy to share data and information, and close anygaps in our professional competencies.We got into knowledge management becausewe had so many projects going on that it was diffi-cult to standardize them without limiting creativity.People know a lot, but apply only a small percent-age of what they know and share even less of whatthey apply. It was important for us to capture thisknowledge. Through knowledge management,leaders not only share experience and knowledge,but move ahead to create what I call “contamina-tion centers” where people infect each other withideas. This gives people visibility and an opportu-nity to say, this is good or this is not. In these cen-ters, people are motivated to improve businessactivities and return value to the organization.We developed an internal system calledProject-Net, so that everyone can share bestpractices through our intranet. Everyone hasRodulfo Prieto,PDVSA:We like the term “knowledge” because it emphasizes the mental-creation phase of every project. It implies working at the highest level of technology to share dataand information, and close any gaps in our professional competencies.Jeff Stemke,Chevron:The idea of looking inside and outsidethe company for best practices grew outof quality initiatives to reduce costs.a ccess to new a pplica tions, technology a nd, a bove a ll, informa tion a bout how things a re being done on explora tion projects a round the corpora tion. We ha ve a lso ha d a knowledge-management manager since 1998. This position reports to the Board of Directors and is responsi-ble for ensuring proper application of technolo-gies a nd the sha ring of best pra ctices a nd lessons lea rned throughout the orga niza tion in order to maintain a high level of competencies. Erik Åbø,Chief Engineer, Well a nd Production Technology, Statoil:We got into knowledge management for practi-ca l rea sons. Like other compa nies, we ha d decentralized and needed a way to transfer expe-rience, sha re best pra ctices a nd run networks. There also were an increasing number of projects with limited sta ff, a nd we didn’t wa nt people using the ma jority of their time just to ga ther da ta. When we ta lk a bout knowledge ma na ge-ment, it’s not just about communication and com-puter technology; it’s redesigning the work process to increase efficiency.And third, subsurface information, especially seismic da ta, wa s increa sing exponentia lly beca use of a dva nces in three-dimensiona l (3D) technology. We needed an easy, effective way to access corporate data, but many of the existingsoftwa re tools didn’t work together or didn’twork in the sa me da ta ba ses. To increa se sta ffefficiency, we decided to establish a central datastore, use a portfolio of tools that could interfacea nd redesign the work process. Most of thecomputer tools that manipulate subsurface datanow work on common platforms. For communica-tions in the decentra lized orga niza tion, we cre-ated an extranet, which is something between anintranet and the Internet, and includes suppliersand partners.Reid Smith,Schlumberger:Almost a decade of working to establish knowl-edge-management infrastructures has obviouslyprovided a wea lth of experience a nd lessonslearned (see “Lessons and Nuggets,” page 72).Wha t business problems ha ve you a ddressed,and what approaches—communities of practice,networks, capturing and reusing best practices,lessons-learned databases, knowledge reposito-ries and portals—have you tried?John Old,Focus Area Lea der, Informa tionManagement, Texaco:Our stra tegy focuses on connecting people.We’ve done all those things to some extent, butnow Texa co empha sizes networks. One of thefactors for a successful network or community isa leader with energy to keep the group going. Wedelibera tely crea ted a network for knowledge-sharing activities. It is composed of people fromthe business units who have a passion for knowl-edge ma na gement. Twice a month, we gettogether, talk about what people are doing andwha t needs to be done to crea te a nd susta inknowledge-management energy.Our gener a l engineering group, whichfocuses largely on the downstream business, hasa da ta ba se repository of best pra ctices, ormillion-dolla r stories, which a re very good a ndactually entertaining to read. They probably getused more frequently tha n other da ta ba ses.Knowledge-ma na gement tools like da ta ba serepositories should be connected to people. Ifyou capture best practices, you should use thema s a mea ns of pointing out the right people totalk with when you face a problem.Lesley Chipperfield,Shell International E&P:We’ve also used many approaches, but within E&P,we focus on people and people-to-people connec-tions. Perhaps this is a reflection of the E&P busi-ness where personal contacts are so important. Fora given topic, we can search our intranet and getErik Åbø, Statoil:There also were an increasing number ofprojects with limited staff, and we didn’twant people using the majority of their timejust to gather data. When we talk aboutknowledge management, it’s not just aboutcommunication and computer technology;it’s redesigning the work process toincrease efficiency.John Old,Texaco:If you capture best practices, youshould use them as a means of pointingout the right people to talk with whenyou face a problem.500 hits, but if someone recommends one, it has more value and credibility. The people you connect with may direct you to a report, but that report now has a personal reference. We have a slogan,“Knowing who is as good as knowing how.” Our primary and most successful knowled ge-sharing solution for promoting people-to-people connec-tions is the networks that were initially established among the technical communities.Although we have moved away from con-cepts like central, formal best-practice reposito-ries, some communities use them if that suits their style of working. On a global basis, most of our staff is connected, at least indirectly. You can pose a question on the intranet and get an aver-age of two or more replies. At least 75% of our technical professionals belong to one or more networks. We call them global networks, but they could be called communities of practice. It’s interesting that in BP, knowled ge management began with d rilling because in Shell the wells group also started it first. We thought it was because of a few energetic ind ivid uals, but it may have more to do with the nature of drilling and completion engineering work.Our three big technical communities are wells, subsurface and surface, but these global networks were actually formed by merging 70 or 80 smaller d iscipline and subd iscipline groups.We looked at what the wells network had done,which was build a bigger community by drawingdisciplines together, and tried to replicate that inthe subsurface and surface networks. Many ofour business networks cut across all disciplinesand supplement the technical networks. Wealread y have networks for knowled ge-sharingand competitive-intelligence as well as anothercritical cross-discipline network for procurement,an d networks for benchmarking, humanresources, safety and environment are just get-ting started. We’re trying to reduce the numberof networks that ind ivid uals must belong to inorder to access the expertise they need.Chris Mottershead,BP:We draw a clear distinction between communi-ties of practice and communities of interest.Other than making sure they have resources, wedo not control communities of interest, which arecreated by people because they id entify withthem. That’s the larger number of communities.For example, there’s a 3D geophysical modelingcommunity, but groups like this are not managedin any real sense. People join communities andparticipate because they have common interests.What we strive for is community ownership.There is some degree of oversight and assur-ance to make sure that there are working net-works in areas where we must d eliver againstspecific objectives, which are important to thecompany. Within the wells area, for example,there are five or six communities of practice orga-nized around themes like nonconventional wells,stuck-pipe prevention and d eepwater d rillingwhere, in a sense, there is self-regulation. If youhave a major role in these areas and you’re not ina network, someone may pointedly ask, in termsof accepted practice, why you don’t participate.Connecting people was a factor in taking ourknowledge-management team apart and putting itback together later. We started knowledge man-agement by promoting networks, but in our orga-nization, the networks probably didn’t initially getcaptured within the formalities of knowled gemanagement. This is one reason we were uncom-fortable with a central knowled ge-managementorganization because people started to rely onthat group to construct knowled ge assets. As aresult, we pulled back and moved closer to whatShell and Texaco are doing—connecting people.There were parallel efforts because we had alead person in knowledge management and onefor engineering cod es and stand ard s, and theywere on the same team. There was no one else onLesley Chipperfield, ShellInternational E&P:We have a slogan, “Knowing who is asgood as knowing how.” Our primary andmost successful knowledge-sharingsolution for promoting people-to-peopleconnections is the networks that wereinitially established among the technicalcommunities.Chris Mottershead, BP:People join communities and participate because they have common interests.What we strive for is community ownership.the team; everyone was doing his or her regular job. There may have been committees, but there was no central engineering department to say that something was right or wrong. Because we had similar approaches in knowledge management and explicit codes and standards, we tried to bring those two things together by constructing a model with our types o organizational wisdom—everyday practices, shared practices, good prac-tices and recommended practices.There was wisdom represented by practices that are used every day somewhere in the com-pany. There was wisdom f rom shared practices that result from connecting people. You may ask someone f or explicit help, which is similar to accessing a report. You’re not as interested in the report itself as in the name on the report. Therefore, much of our networking involved ways o f connecting people through tools like Schlumberger Connect Oil & Gas. Then rom shared practices, you eventually make tacit knowl-edge into explicit knowledge, which we call good practices. The typical example is codes and stan-dards. They’re not right or wrong, but if you want a turbine, here’s how you procure and install it. An expert user probably takes best practices and does something different, but you can just use a good practice if you don’t know anything else.The f ourth type of wisdom is f rom recom-mended practices, which are actually just expec-tations, not de f initive answers. They arequestions you ask rather than answers youseek, which forces you to cascade back down thechain just by getting two people together. Thereal added value goes back to where it origi-nated in a shared practice, but the process isstructured in a way that connects disparatethings together.Reid Smith,Schlumberger:Trust is extremely important. Using knowledge-management resources, one of our engineerswas able to find what he needed to get startedon an offshore extended-reach drilling project inWest Af rica. He f ound a best practice that hewas extremely positive about because he knewthe person who submitted it. This person hadpreviously been his field service manager and hetrusted him.How do you connect people to the things theyneed to know to do their jobs through problem-solving, knowledge-sharing and innovation? Doyou have different types of networks or commu-nities? How do the business units use them?How are they organized and what support dothey have?Rodulfo Prieto, PDVSA:Our production and exploration communitiesdeveloped in dif erent ways. In the productionbusiness unit, communities act as centers oexcellence. They validate, certify and provide sup-port for decision-making. Most production projectswill have members from the community consult onthe project when an important benchmark is beingdiscussed. This process is mandatory.In the exploration business unit, we have acommunity of interest where people participate bychoice in their area of specialization. There is dualcitizenship in the sense that you’re part of a pro-ject, but you also belong to the exploration com-munity at the same time. The project has theoption to consult with the community if necessary.We don’t have a unique structure for commu-nities. For example, there are communities ointerest that developed on their own like the geo-physical group, which organized an in ormalweekly forum within the company to share knowl-edge. We support these communities and thistype of communication between members as well.Communities ask for budgets when they want todo something. In exploration, communities aref unded through various projects or technologicalgroups under the knowledge-management depart-ment. I’m interested in how funding and budgetingare done in other organizationsReid Smith,Schlumberger:Trust is extremely important. Usingknowledge-management resources, oneof our engineers was able to find whathe needed to get started on an offshoreextended-reach drilling project in WestAfrica. He found a best practice that hewas extremely positive about becausehe knew the person who submitted it.Rodulfo Prieto, PDVSA:In the exploration business unit, we have acommunity of interest where people partic-ipate by choice in their area of specializa-tion. There is dual citizenship in the sensethat you’re part of a project, but you alsobelong to the exploration community atthe same time.Management push is necessary to get through the valley of pain on the way to the summit of gain—Erik Åbø,Statoil.The greatest challenge in creating a knowledge-sharing culture is coming to the realization that sharing knowledge saves rather than consumes time—Lesley Chipperfield,Shell International E&P.Successful knowledge management must engage everybody in the organization. It is not a central activity that collates and validates a corporate encyclopedia of subject-specific knowledge or knowledge-management processes. Having a central team means that you may rely on it too much. Knowledge management is not an ency-clopedia, but rather a recipe book to start people talking. Knowledge management is a consolidated tool for the disparate learning throughout the organization, but it is not adefinitive answer. It is a creative tool that people use to invent their own answers,informed by and armed with the experienceof others. Fundamentally, this is knowledgemanagement of knowledge management—Chris Mottershead,BP.When members of a group, team, network orcommunity understand the individual communi-cation preferences of each person, and theirresponsibility to communicate in ways thatmatch those preferences, the effectiveness ofthe whole group improves—John Old,Texaco.Our biggest challenge is to have a corporationwith organizations, teams and individuals thatapply what they know and recognize what needsto be learned or unlearned to improve costand risk assessment, and reduce project cycletime through integration of all availableinformation—Rodulfo Prieto,PDVSA.The biggest challenge is to create and nurturea knowledge-sharing culture in which peopleshare knowledge and learn from others as amatter of course. They see it as simply the rightthing to do—Reid Smith,Schlumberger.We must provide connections between individu-als who seek and supply problem-solving ideasand experience, and those in a community whoshare experience and reuse practices for per-sonal professional development, corporatelearning and innovation. We also need to con-nect people with explicit knowledge by makingit easier to tap into the growing volume of docu-mented practices and lessons learned.As chief knowledge bee, I travel around cross-pollinating the organization by picking up ideasand practices in one location and spreadingthem to others. Occasionally, I help a teamdevelop or use a knowledge-sharing tool or pro-cess and leave some “honey” behind. I realizethat it takes time to redesign the “hive,” soI use honey rather than a sting to induce partic-ipation—Jeff Stemke, Chevron.Lessons and NuggetsLesley Chipperfield, Shell International E&P: One of the roles of my group is to help networks get funding, but value p rop ositions come from the networks. We can help, but networks have to make a case for their existence. However, because networks are now such an integral part of the company infrastructure, we’ve moved past the point where groups must start from zero. Ask if we could do away with networks, and people react in horror because they wouldn’t have suffi-cient resources. We rely on picking up practices from others rather than finding them ourselves. The network organization is completely informal.We have a combination of common-interest networks and communities of practice. There are a few exceptions, but people are not obliged to belong to these networks and communities. Theyget involved because they want to contribute. Inthe early stages, p eop le would ask, “How do Ifind time for networks?” I haven’t heard that forquite a while. The first year, I got calls to budgetfor the hours p eop le sp ent networking. Thatp roblem has also gone away. Peop le see net-works as a valuable resource because they sim-ply make sense. Now we budget primarily aroundp eop le who actually manage knowledge andnetworks, mostly out in the business groups. Inmy group, the minority of our knowledge-management budget is sp ent to facilitate andsupport best practices.People were beginning to ask, “If you have aline role, why aren’t you active in a network?”We, therefore, started appointing global consul-tants—individuals who are experts in a specificarea, but may work anywhere in the comp any.They are listed in an expert directory. It’s an eliteclub, so we don’t call it Yellow Pages becausenot everyone can join. You have to be nominatedand approved. These individuals are expected tobe active in their networks, but they also areexpected to contribute to other networks on anexchange basis and can do work for other com-panies if invited to do so.John Old,Texaco:That’s similar to the Texaco Fellows program. Ithas separate funding and members are expectedto contribute globally.。
