In this episode, you’ll hear from Michael Fry, who was supporting the Deepwater Horizon rig at the time of the catastrophic blowout and oil spill on April 10, 2010. Now president and CEO at Deepwater Subsea, Michael explains how his company uses technology from Hexagon PPM to digitally transform processes aimed at preventing similar tragedies.
BK: Welcome to HxGN Radio! My name is Brian and today we are featuring a conversation between Andrew Storrier of Hexagon, and Michael Fry, Founder and CEO of Deepwater Subsea. One of the drilling rigs that Michael supported as a Subsea Superintendent, was the Deepwater Horizon in the Gulf of Mexico which was tragically destroyed in a fatal blowout in April 2010. Listen in as Michael describes how he has taken lessons learned from that tragedy to create a step-by-step digitization process that the Oil & Gas industry can use to prevent future disasters. He combines his 10 years’ experience in the U.S. Navy aboard nuclear submarines and more than 20 years’ experience in subsea operations to create the oil and gas segment’s premier subsea operational excellence consultancy.
AS: Welcome everyone listening at home. Today, I’m with Michael Fry. Michael has a wealth of experience. Michael did you want to introduce yourself a little bit, give context to our listeners?
MF: Sure.
AS: About your background, your experience. Some pretty interesting stuff, I believe.
MF: I appreciate it. So, my name is Michael Fry. I’m the president and CEO at Deepwater Subsea. We’re an operational excellence consulting company, based out of Houston, Texas, specialising in subsea operations, real-time monitoring, competency development and training. Been in oil and gas for just over 20 years. Part of that, I spent 10 years in the US Navy, working on nuclear submarines, working with torpedoes, cruise missiles, and weapons delivery systems.
AS: Wow. Okay. So, you’ve seen it all?
MF: Seen a little bit.
AS: Yeah, seen a little bit. Yeah. I think you had some experience as well with the Deepwater Horizon event, and that’s what’s I think jump-started your most recent business. Right? Do you want to talk a little bit about that as well?
MF: Yeah. So, I was the Subsea superintendent for Transocean, for the Deepwater Horizon. It was one of the rigs that I helped support from a Subsea operations standpoint and technical field support. I had multiple rigs that we supported, but the Deepwater Horizon was one of them. So, one the night of the incident, April 20th, I got a telephone call basically asking for where the control system drawings were, and obviously, I knew that something was wrong because that would not be a call that I would get at basically about 10:30 at night.
So, I started asking some questions. Basically, I got, “Hey, don’t worry about it at the moment. We just need this information. Just go ahead and go back to bed.” Ended up making a telephone call out to the rig. Obviously, for obvious reasons, no one answered the phone. Sent out an email to the rig and to the rig manager basically saying, “Hey, I got this really cryptic telephone call, what’s going on? Is there anything I can help you guys with?” Got a response back, basically saying, “Hey, you need to get to the [Parkten] office,” which was the North American office, “As quickly as possible, can’t discuss anything more about it.”
So, from a day to day operations standpoint, Horizon was one of my rigs. I made multiple trips to it. Sadly, six of the 11 guys that were lost I knew fairly well. A couple of them I worked on other rigs with, but it was just … Yeah. It’s a tragic experience, not only to go through from a support standpoint, but just the helplessness of trying to do everything you can to help secure the BOP at the time, and basically, everything you did just did not work for obvious reasons.
AS: Yeah, absolutely. I mean, it was an absolute tragedy, and obviously … Well, it’s a disaster as well, and I think one of the things that came out of this, it was such a huge public profile of this incident. It’s like, how could something like this happen? And that motivated you as well as, well, what did go wrong here and what was the problem that no one knew that was happening? It sounded like in that phone call, have you got this particular piece of information, and they obviously couldn’t find it. So, what are your thoughts around that as well? How can we go about preventing those disasters, I suppose? What is the problem that crops up?
MF: One of the classes that we teach is a Subsea management training course to help guys understand how to run their department, how to run a subsea department, and from that spun a quality assurance training course. It’s one of the courses that I’m actually in Australia at the moment, teaching. What’s interesting about it is, one of the questions that came up today during the class is did the blow-up preventer function as designed? And there will be a lot of people on one side of the spectrum that’ll say, “No, it didn’t because Horizon happened.”
And then, there’re others who, when you look at the technical information that was available, the BOP did what it was supposed to do. It shared the pipe; the emulators were closed. Functionally, it worked. Unfortunately, what you saw on TV was a blow out because the elastomers around the rams actually started to wash out. So, it didn’t matter what happened in that moment. Once the rams washed out, it was all over with. Right?
So, could this have been prevented? US regulations have changed because of Macondo. The new well control rule back in 2016, was basically based off how we prevent another Macondo from happening. Unfortunately, the question I always ask is if from an operational standpoint, the things that went wrong, not counting the BOP, if we did the exact same thing over again, could Macondo happen a second time?
Unfortunately, that answer is yes because it had nothing to do with the blow-up preventer. And, I say that with some bias, being a subsea person but the reality is, operationally, there were so many things that went wrong that if we did it all over again, the exact same steps with the new regulations in place, you’ll probably still have a similar event.
AS: Right, okay. So, it comes down to the operations factor?
MF: It really does at the end of the day.
AS: Well, let’s dig into that. So, what are the problems with operations and the management of operations that’s allowing these sorts of risks to continue to exist within businesses?
MF: I think a big one especially, not picking on Macondo, but a big one is the human factors. Right? It’s all about the peer pressures, and the understanding of what’s really required for operations to where, there were a lot of things that were done systematically, that you would not do during normal operations. For whatever reasons, those decisions were made. I don’t know why they were made but they were made from the investigations and the fallout from it. The sad thing is it really comes down to cutting cost, speed, things that … It’s like, look, the money’s already been spent, the money’s been budgeted. Hey, we’re over budget, so what? Let’s just get it over with, and let’s finish safely, and move on.
But, even in 2019 you still hear the question of, well, the cost, and what’s the ROI or why are we making this decision if we could do this way? It’s like, guys, Macondo was really only nine years ago. Are we going back in the other direction again of, I understand what’s right, but cost is now coming back into the forefront, right? So, how do you eliminate a Macondo from happening? Operationally, you really have to have organizations where the human factor of peer pressure and outside influences get removed, and it’s this is what needs to be done, this is the way that we do business, this is our policies and procedures, and we’re going to follow them to the letter of the law, and we’re not going to deviate because of management pressure to try to speed things up. We’re going to do the things the way that they need to be done, and just execute it safely, and move onto the next job.
AS: So, just coming back a little bit there with Macondo, not only was it the human factor that was involved but there could’ve been a cost cutting exercise in that didn’t allow for that operations management to have visibility of the technical piece that failed in the end?
MF: Yeah. I mean, I think if you look at from there were simple operations that are done on every rig at the end of every well, and if you sit back and you go, “Why did we do it this way?” It makes absolutely zero sense. It had to do with trying to speed up the operation.
AS: Right.
MF: Versus, do step one, do step two, the way we’ve done it a thousand times throughout the industry. This was one of those perfect storms where a lot of bad things that shouldn’t have happened all got lined up at the same time.
AS: Yeah, right. Okay. That seems to be a common thread in that the speed to delivery and cut cost out as well. That seems to be creeping back into the industry. Is that something that you’re seeing right now or is it just …?
MF: I think cost is always a challenge. I say this quite a bit, and people can take it or leave it but in deep water operations and offshore oil and gas, you have to pay to play. There’s high risk, there’s high rewards but the day to day cost is very high, especially with subsea blow up preventers. You know, going into it, that you’re sitting down at the high roller’s table, and you’re going to have to pay to play. So, unfortunately, cost is always there but I think when you start tying bonuses to performance, and now, somebody’s saying, “Well, if I cut this over here, momma can get a new car.” It’s like, look, operationally, this cost is always going to be there. If you know that it’s a requirement, especially regulatory requirement, how do you cut it out of the day to day operations?
So, you see this internal battle between management trying to do the right thing, we’ll never cut corners, or we’ll never do this, we’ll never do this. Then, operationally, it’s perception versus reality. The perception is do it safe, do it efficient, do it, don’t worry about what happens, we’re going to take our time. Reality is get it done, get it done quick. And it’s not everywhere but you still see incident investigations of what happened. Well, they didn’t want to spend money, they did this, and they want to do that.
And it’s like, guys, did we not learn our lesson the first time around? We just had the anniversary of Piper Alpha, and we have the Deepwater Horizon, and we have these major catastrophic incidents that have taken place. We memorialize these events, and we bring them up as anniversary reminders, yet when it comes to operations, we fall back to pre-2010, and go, “Well, that was a one-off incident.” But it still happened.
AS: There’s a couple of things that I’m pulling away from this, is that probably sounds like there needs to be a better bridge between the executive and actually the team executing so that the speed to delivery doesn’t increase, so that the executive is educated to understand, no, no, we can’t speed up for these reasons. If you’re afraid of unplanned costs, it’s coming through the form of a disaster. And then, on the other side, it sounds like there’s also the operations management, the human factor. There probably needs to be checks and balances in place there. I mean, I don’t want to take words out of your mouth but some of these problems that we’re discussing, what are some of the solutions?
MF: So, I mentioned my background being US military, right? One of the collateral duties I had was a quality insurance inspector, so Subsafe QA, which is probably one of the most stringent quality assurance programs in the world. There was zero tolerance for non-compliance. I say all the time, it’s 100%, 100% of the time. The difference is the reason we looked at it differently is you actually went underway with the submarine. So, when operations are taking place in any industry, somebody can go, “Well, it’s my shift, so whatever, I’m going home.” On a submarine, if you rebuilt the vows, and you’re a part of the quality assurance program, 99% wasn’t good enough because you were going under water with those whole vows that you just witnessed. And if it was like, well, the other crew will catch it and my chopper’s coming here shortly, you’re going under water with the submarine.
So, some of the takeaways for me, from an operations standpoint is transparency. So, we talk about digitalization and transformation, a lot of these things are happening in the industries today, in all industries. One of the reasons we’re going hard digital is because it allows me to demonstrate to my customer, every step of the way, where we’re at in our operation. So, what that allows me to do is remove the unknowns of, well, how much do we have left, and why is it like this, and what challenges are we facing? I basically utilize tools that I can present back to my customer, and say, “Here is exactly where we’re at.” He knows every step of the way where we’re at in the process. So, it gets away from that what’s left, why are we doing this, what are we got to do? He knows, every day, where we’re at.
So, I think that’s one thing that happens. You get management that gets disconnected from operations, and then when they reconnect, it’s like now, we got to speed things up, or if they were just connected the entire time, you would remove a lot of these challenges that operations face.
AS: Yeah, okay. So, how do you guys then incentivise or KPI, or manage that process? Traditionally, key performance indicators, are they tied to compliance and those kinds of things? How do you get people to stick to that?
MF: For us, it’s 100% compliance, and the reason for that is … We were talking about it earlier, offline. So, US regulations, EPI regulations, American Petroleum Institute, these standards are written into contracts and written into regional regulations. So, what I always tell people is, “Hey, look, it’s black and white. I don’t have an opinion about it, I’m not bias one way or another. I might not agree with it, but the regulation says you’re going to perform X, Y, and Z. We’re going to perform X, Y, and Z, and if it says you’re going to document the following, we’re going to document the following.” That way, if heaven forbid, something happened and we were called to the table to present what we did as far as this check, I have the objective quality evidence to be able to demonstrate back to the customer, these are the things that we did.
So, the way that we get around it is we ensure that the criteria for which we’re auditing against is documented, and it’s visible to our inspectors, our surveyors. Then, we assign the quality evidence that they’re supposed to capture. So, for example, verify the calibration of this gage is within the standard requirement of three years. It has to be traceable back to an industry standard, so what they do is they’ll take a picture of the gage, they’ll get the calibration sticker. Then, they’ll actually get a copy of the certificate which we use as the objective quality evidence. So, if somebody said, “Prove to me your guy actually did that,” here’s the picture, here’s the certificate.
So, what that does is it removes me from saying, “Hey, did you really do it?” The guy’s like, “Yeah, trust me. I did it.” No, no, I trust you. One of the things in the Subsafe QA program was trust but verify. I trust you. We joked about, hey, look, I love you like a brother, but I don’t trust you like my brother. But even as an employee, I have guys who have been doing this for 25 years, and they say, “Look, no one’s ever questioned me.” I’m not questioning you. What I’m doing is protecting you, and if you’ve already captured this information, then just put it in there and attach it to the check of the criteria, and then there’s nothing to worry about.
AS: Yeah, absolutely. I mean, it sounds like you’ve got to manage a lot of information there.
MF: A ton of information.
AS: Yeah, and I was going to ask something pretty facetious which is, can you do that manually? I mean, it probably is possible, right? But is it-
MF: No, because the challenge is everybody … When you give people an option of where to file something, one guy will file it over here, one guy will file it over there. Well, the Internet’s not quick enough, so I got to wait till I get home. Manually, sure, you could do it manually. Hey, scan this, give me a printout when you get back to the office. Unfortunately, my thumb drive crashed, or my computer crashed, or well, I didn’t get that. There’s-
AS: Human factor.
MF: How you remove the human factor, right. You give them tools that they can use in that moment, to actually attach to it. So, I try to remove from them, hey, look, if we get called to a board of inquiry or in front of the customer, or the US regulator, what evidence do we have to go back and say, “Yes, this work was done?” All you can do is go digital because if you’re not, you’re going to be digging through drives and share points and printing out different manuals.
AS: No, thanks. And I mean, obviously the costs that are associated with the risk with that are self-evident but I think, coming back, well, if that’s the case, if you go to digitalise, what kind of investment are people looking at in terms of digital transformation? Is it simply a process of just buying an information management tool or what’s process? How did you guys walk through that to start setting up the system that you guys have at Deepwater Subsea?
MF: It’s a good question. So, initially, from compliance inspections, pretty much everybody for the most part used to use Excel spreadsheets. So, you had the spreadsheets, had all the tabs, here’s all the checks, here’s why you had to do it. It was cookie cutter, everybody uses the same regulation, so there’s not some secret sauce that company A has against company B. So, what we started off with was basically G-suite or Google, because I wanted something that web based that the guys didn’t have to remote log in and go through all that IT hassle. So, I said, “Okay, we’ll use G-suite. We’ll make it simple. You just take the documents; we’ll upload them to the drive for that job.” Should be pretty simple, right?
If you give people choices, they’ll put it in different folders, and they’ll put it … Hey, I created my own folder, and it’s over here. So, I started looking at the challenges that I was hearing from my customers, and we actually picked up customers because our competitors were allowing the US regulator to find incidents of non-compliance. So, one of the things I said is, well, do we prevent that from happening? So, basically, we had to take ownership of the equipment almost like it was ours, so if there was an inspection that had to be done every year, how do I ensure that the drilling contractor’s making sure that that PM is done, that maintenance is done?
So, I created a digital system that replicated the requirements of if the asset was own, which basically informed me that this PM was coming due, so I could make sure that the drilling contractor was doing his PM the way he was supposed to do it.
AS: Right.
MF: So, you’re digital twins on these other things, and for me, it was literally just a digital recording platform. So, I said, “If this is the asset, what’s its make, model, serial number? What’s its date of installation?” The metadata that goes behind with it from an asset information. And then, from an operational standpoint, the more that I gather from that piece of equipment, the certificates of certification, the last inspections, how many cycles has it had when we start getting into real-time monitoring.
When I started looking at how do I bring all that together, I was like, “Hey, look, I’m a really smart guy. I’m going to build my own system.” What an absolute disaster that was because now, I’m having to go to consulting companies, and go, “I want you to build for me this system.” And they were like, “That’s fantastic. Let’s just start with six figures.” Six figures for what? Well, I can do this on own then. So, we started looking at access databases, and file maker, and it’s like, all right, I got to come up with a way to try to make this work. And every time I turned around, I kept going, “I don’t have the time or the resources to make this happen, to actually pull this off.” So, I’d go back to another consulting company, and go, “I want to build a system that does all of this stuff.” And they were like, “Yeah, absolute. It’s fantastic. Six months, six figures.” I’m like, “Look, I don’t have six months to wait.”
So, where this all gets wrapped up, long story short, we started doing real-time monitoring, and we’re looking at … A step back for a moment. Somebody came to me and said, “Hey, have you ever thought about doing real-time monitoring on the blow-up preventers?” I was like, “Absolutely not. I don’t want anything to do with any of that stuff because it’s a huge investment, and I know US regulations are coming that are going to make it mandatory but I’m basically … It’s like the fill the dreams, right? If I build it, hopefully, somebody will come along and want it. But if they don’t, I’ve built this system that’s zero value to our company.”
So, what we did is we invested in OSIsoft’s PI system, and it was funny because I said, “I have to think about the big picture.” One of the things I always talk about is … There’s a great book called the 48 Laws of Power, and one of the 48 laws of power is basically planning to the end. And then, think of every possible scenario in between there, so you’re already prepped for anything that could happen because you’ve thought about it ahead of time.
So, what I said is, “Okay, I’m going to invest in this. What happens if nobody buys it? How do I utilize this real-time monitoring system?” What I said is, I’ll start utilizing it for our digital verification program as part of the system. I’ll build the asset hierarchy just like a vow’s the rig equipment owner, put all this metadata in, and then I’ll let the system inform me via text messages and emails, and just digital visualization of displays, the information that my guys would be doing as they’re doing their inspections.
When I really started getting into it, I went to an industry conference with OSIsoft, and I ran into the j5 team, and they introduced me to the j5 operational management system and IndustraForms, and all the rest of it. And then, it clicked. It was an instant. The joke is it was one of the fastest point of sales to go from initial contact to let’s cut it, let’s get it going, installation wise. I think it was a week from the time I met them to the time we had the system.
It was like, this is what I’m looking for. It does everything that I want, it’s customizable, it’s web based. I don’t need anybody else to help me build it, my team can build it. We just dove in, and it’s been the best investment we’ve ever made for. To answer your question, why companies go away from it, I think, the challenges of digitalization. If you don’t see the ROI upfront, unfortunately, a lot of times, you’re investing in something that won’t have a return to the bottom line. It’s really about operational efficiency, and what you can give back to not only your employees but your customers. It’s not something to say, “If I invest in this technology, I’ll be able to save X or I’ll make X in the back end.” You’re investing in yourself as an organization, to improve the efficiency and the delivery of your products.
AS: I think just listening to you talk there as well, Mike, you had a really good understanding of what your problem was and what the potential solution was, you just didn’t have a solution. Then, you obviously bumped into j5 International, and you’re like, “Here it is.” So, I think that’s probably where other providers need to educate themselves, is understanding what their problems are. So, digitizing, and obviously I’m not technical on this front but they could probably understand, well, this needs to be digitised, this is where we need to capture information, and this is how it should be replicated. So, maybe that sounds like the core issue here. A lot of people, when they say, “We want a return on investment or we want to understand the value of the platform”, they’re probably not ready in and of themselves to purchase a solution because they actually don’t know what their problem is, or the scope of their problem is.
MF: I think one of the big things too, from a management standpoint is there’s a lot of organizations today that don’t want to do software as a service because they want their own solution. We want to own this process. Unfortunately, for me, I think it was the best decision that we made was I’m tired of trying to reinvent the wheel. I’m going to go hire other smart companies who have already built the wheels, and I’m just going to bolt them under my car, take off and run. So, every software that we use now is a software as a service, but it’s built into, we call it an ecosystem, where all of our systems are integrated with one another.
So, OSIsoft’s the hub because that’s where the real-time monitoring data comes in. j5’s operational management system can pull information from the PI system, it can also write back from the IndustraForms, back into the PI system. We’ve now invested into Hexagon’s SDX operational software that allows us to use smart PN IDs, which allows us to basically integrate with j5’s IndustraForms, and also pull PI system data. So, every software that we use, one of the primary, fundamental requirements is it must be able to be integrated with the rest of the systems. And if it can’t, it just doesn’t meet the cut.
So, one, it allows me to move a lot faster because all I have to do is basically sign the check and say, “Here’s where we need to download it, and here’s how you connect it, and now, you’re off and running.” Versus months and months and months of having to sit down and go, “This is what I want,” and having to explain to somebody else to build it, versus just going and finding what’s already been built, and saying, “I’ll take it. Let’s go.”
AS: Yeah. I mean, this sounds like your digital strategy really is you’ve actually got a really clear picture. Do you guys have it documented as well, within the business, as how you go about acquiring vendors or what’s your process there when you take a request or proposal from vendors? Are you looking this is where you need to plug in, and this is what we expect out of you as a vendor?
MF: We’re a very small organisation, and this probably goes against conventional wisdom. Mike finds a software and he goes, “I want it and I already know ahead of time what it is that I want it to do, and what it needs to do.” What’s interesting is the more I talk to the Hexagon team, talking about SDX system and other tools, SmartPlant, when I sit down and start going, well, this is what I’m looking for, and they go, “Yeah, yeah, I can do that.” Then, I get more and more excited because, oh, I didn’t realize it could do that.
So, I know what I’m looking and it’s like I always say, this is the piece of the puzzle that we’ve been looking for, and my team jokes because they’re like, “This puzzle doesn’t have an end to it. It just keeps getting bigger and bigger. All puzzles have so many pieces.” But for me, though, it started off with I needed something to take my checklist digital because I wanted something, and I actually use it in our marketing materials. I tell our customer, “Look, everything we do is web based. It’s transparent. You have a log in, so if you ever want to go and check where we at in the status of the inspection, log in and take a look at it. If you want to see where we’re at from a real-time monitoring standpoint, log in and see your rigs.” We have nothing to hide because if we’re doing our job, we should be transparent in everything we do.
I think what happens is when you get organizations who start covering up, and it’s like, I don’t want you to have the documentation, I don’t want you to see what’s going on behind the curtain, then you start wondering, are you really doing what you’re supposed to do? But when we go about selecting softwares and vendors, it really comes down to I see something online or I get introduced to something, or one of my team says, “Hey, look, have you ever seen this?” And it’s like, oh, let’s take a look at it. If I like it, and it fits the purpose of what we’re looking for, then the rest of us just make the investment and pull the trigger.
AS: Yeah, no, fair enough. I might be changing tact a little bit here but one thing I was thinking about, we discussed offline as well, is just adopting digital solutions or digitizing processes. There’s a lot of resistance to change around that. A lot of people seem to, well, within this industry, dig their heels in and say, “Well, the way we’ve done it works, and it’s worked for the last 25 years.” How do you approach problems like that? And how do you get people to open their eyes to the possibilities of MF: digitising operations?
MF: That’s a good question. When we first started rolling out the digital checklist, as a business owner, I was excited, my customers were excited, and my team not so much excited. I know it’s bad English, but my team was like, “This sucks. Why do we want to do this? We’ve been doing this for so long, it works. Everybody else is doing it this way. Why do we got to be the company that changes things? You’re making it more difficult for us to do our job.”
The funny thing is that resistance to change, right? If you try to force change, and not show people the value of why you’re changing, then it gives them a reason to resist it. You’re going to do it because I own the company, and you’re going to do it because I tell you, versus, I go, “Have you read the new regulations lately?” And they say, “What do you mean?” I say, “Well, the US regulation requires us to verify this and this and this, and document the process, and show the documentation we use for verification. All of this stuff is what your digital checklist does.”
So, when companies resist change, I think, unfortunately, they don’t understand the reason why they’re changing. A lot of companies change so often that the guys in the field are like, “Yep, here comes another one. Just get ready to ride this wave out, and this one shall too pass.” Or they try to implement a solution that, for the guys in the field, it’s not fit for purpose but from an operations and management standpoint, the salespeople that came in said, “Oh, this is the piece that you’ve been looking for.” Management invest in it, and the guys in the field go, “We actually went backwards.”
So, for me, when I’m working with the team, it’s always, guys, this is a process. We didn’t show up on Monday, and I flip a switch and say, “Okay, we’re going 100% digital.” We’ve said, “Okay, these rigs are going to start going digital because one, they have the bandwidth, they have the customer that supports it.” We have other rigs that are like, “Hey, look, I can’t even get online and check my email.” So, we go, “Okay, we’ll stick to the paper for the moment.” So, we’re working through this process, but I think from an organizational standpoint, especially in industry, especially today in oil and gas, everybody’s trying to be that next company to find the next golden ticket. It’s like, this is going to project us out in front of everybody else. We’re going to invest in this new maintenance, and this new information management system, not really thinking about the end user.
For me, I was one of the end users, so when I started looking at how do we meet the requirements, it wasn’t a hard sell from a, guys, look, this will actually make your job a lot easier, because some of our inspections can take months. I might be on the rig, you might be on the rig, we’re changing back and forth. So, what happens is as the regulations change, who’s updating that Excel spreadsheet? How do you know that you actually have the right document to be referencing against?
Digitally, I make one change, it goes out through the whole organization. So, for me, it was very simple because as I saw some of these checklists coming in, I was like, “Where did you get that checklist from?” They’re like, “Well, I had it on my computer.” We haven’t used that thing in a year, and it’s like, all right, guys, we got to make this change, and we’re going hard digital, and it’s going to be controlled by one central point. And every time you log in, you’re going to get the latest and greatest revision, and you just move forward with it.
AS: Yeah. I mean, is there a set formula for how you digitise, or is it just like you were saying, that freeform, whatever the biggest problem is right now, let’s try to digitally solve it as it comes at us?
MF: I think you take in pieces. For me, for example, we were talking about on the drive over, one of the last pieces of the puzzle was the information management part of it. I had real-time monitoring for streaming multiple rigs. I have a digital checklist, operations logbook, the whole j5 operations management system. Fantastic tools but yet I would have to go find a manual or find a drawing, or find a document, and it was like, good gosh, I spend so much time looking for this one piece of information. There’s got to be a tool out there that we can utilize. I get introduced to SDX and SmartPlant, all the rest of it, and it’s like, boom, now I have the last piece that we’re looking for because I bring in the other half of the system that ties it all together.
So, for me, it’s a step process. Unfortunately, I didn’t know which step was the first step because we don’t really have an IT department, we don’t have system engineers. We do now because of real-time monitoring, but before it was Mike, Mike and Mike. It’s funny but it’s sad at the same because we are a small group. Our Houston office really has … We have five people now, office-based staff. And then, our real-time monitoring team that come and go, based on a rotation. But we’re not some huge organization where it’s like, oh, we got the IT group over, we’ve got this group over here.
We outsourced a lot of it but when it came to finding the right tools to use, it literally sat down, and it was like, what are my biggest pain points? I need to find a solution to fix them as quickly as possible. But I started with, what is the biggest risk to the organization? What is the biggest reward back to the customer? So, that’s how we went through it.
AS: I think that’s the interesting part around that. You centralise everything on what the customer actually needs, what’s the output here that they need most. A lot of the time, what gets revealed is not an overhaul process per se, but how can we deliver value? And I think that’s the missing piece. We’ve touched on it lightly in our conversation but it’s like, how much do I need to invest? What’s the ROI? These are the questions. Would you say they’re the wrong questions to be asking? Rather, should someone look at it through a different lens?
MF: I think the question of ROI, you might not get an ROI. If you looked at the investment that we as Deepwater Subsea has made in technology, we’re probably a negative ROI because we’re not gaining anything back from … Like, hey, we’ve invested, just hypothetically, we invest 100 grand in all this technology and it’s going to make us 500 grand. There’s no outside because the question is what if you didn’t have the technology? Could you still deliver the work that you do? Yeah, absolutely. Technology’s just made us more efficient at it. It didn’t eliminate people, it didn’t speed up anything because I’m there as an inspector, so I’m basically watching somebody else do their job. And I think, unfortunately, for us, for an example, from an inspection criteria and the things that we do, one of the things in the US is the regulator can come in and say, “Show me the documentation that you use for this.” And I briefly touched on it earlier.
We actually had an example of that where the US regulator caught wind of a problem across industry, and went back to our customer, and said, “This rig has this type of equipment on it. What did you guys do to make sure this thing was closed out?” So, our customer came back to us, I pulled up our IndustraForm where the check was in place, went to the operations logbook, here’s all the objective quality evidence that we captured. It was five minutes worth of work to turn around and go, “Here you go Mr. regulator, here’s all the proof that this work was done.” And they actually sat back, were like, “Can you show us more about that?”
AS: Yeah, unheard of.
MF: So, now, for us, when in the Gulf of Mexico, the new rule talks about the new US regulation for blow up preventer testing, the requirement’s 14 days but if you document from a condition monitoring standpoint, and the work that’s been done in failures, you can request 21 days. The thing that’s interesting is the IndustraForms operations logbook, SmartPlant, it does everything that the US regulator is asking for.
So, the ROI to our customer is, hey, if you utilize us, I can check all of the boxes that the US regulator’s looking for, through the processes that we do every day, utilizing the technology that we have. There’s not a tangible value that’s put to it. Yeah, a customer can come onboard and say, “We’re going to come onboard because you can do the following,” but I can’t say they came onboard because of this, because they’re really looking for the other half of the service. But that technology helped elevate us above our competition.
AS: Right, okay.
MF: So, it’s a-
AS: Competitive edge.
MF: Yeah. For me, I’ll use it from a marketing standpoint like, can your other service providers do the following? Well, no. Well, we can. So, if you come to us, we already checked the box, they actually build it into the request, back to the regulator. We utilize Deepwater Subseas X, Y, and Z processes, the [Janice] 24 system. But the hardest thing is upper management always wants to know, well, what’s the return on the investment?
You might not see one for a long time. I make the joke with one of my customers. I say, “Look, I can save you $2 million a year but it’s going to cost you $1 million.” And they go, “Well, that’s not …” I’m like, “That’s pretty good ROI if you think about it.” I say, “Well, how about this. I’ll save you $3 million a year but it’s going to cost you a guaranteed $1 million. Would you take that investment?” The guy’s like, “Absolutely.” I said, “You’d be pissed for 12 months, every month I dump an invoice to you. You’re going to be like, oh, I don’t see the value in this, because you’re not going to see the value until after 12 months.”
The problem is a lot of people look at technology that way. We’re making this huge investment, how fast am I going to see that ROI? Well, you might not see that ROI until a year, two years down the road but management sometimes doesn’t want to hear that. They want that quick fix, that quick turn, and unfortunately, with technology, a lot of times you don’t see it.
AS: Oh, would that be a case, then, coming back to what we’re talking about with those performance indicators? Educating management, then, about well, look at our compliance record. We’re running at 100% there, and that’s the value of digital. Is that where that would play in to help stop, I guess, management getting so jumpy when they don’t see the value?
MF: I actually flip it and say, “How much time are your guys wasting doing things that could be done digitally?” What I mean by that is you still want them on deck. We talked about this today in class, and I said, “Well, with the digital technology, why do you do daily rounds?” And they say, “Well, we do daily rounds to get the guys out of the office and go inspect the equipment.” I still want them to do that, I just don’t want them to waste time writing down information that I could give you digitally. So, for me, it’s the efficiency of how well Johnnie does his job, versus trying to change the way Johnnie does his job, if that makes sense.
AS: No, absolutely. Productivity. If you can’t see the growth value of productivity, then you probably shouldn’t be an executive, I guess. I think the other question that was sparkling in my mind as you were talking, Mike, was just around the idea of the ability that your company had to talk to a regulator, and say, “Here’s all the information you need”, almost in five minutes. Does that mean that there should be some petitioning going on, perhaps from a government level about digitizing kind of operations? Because we know what the damages can be, and maybe the regulatory compliance aspect should be like, well, you need a platform or you need to start moving towards a platform that allows us to access and give us the visibility that we need to see that you’re doing the job right.
MF: That’s a good question. So, in the regulations today, it says that documents can be requested basically as the regulator request it, but it says they have to be readily available. Now, the challenging question is what is readily available? I mean-
AS: Super subjective.
MF: And I always make the joke like, when they came out to the rig and they say, “Hey, we want to see this,” readily available means before I get back on that chopper, you better be able to show me that document but that could be over a couple hours. I try to always put myself in the regulator’s shoes and go, “I’ve asked for this document which you say you have but yet you can’t produce it to me in two hours. Why is that?” So, unfortunately, with information management systems today, a lot of them are not built for that quick go find the information. But it is written in the regulations that it needs to be readily available, there needs to be a copy on the rig, there needs to be a copy ashore. So, you’re seeing this bigger push, even in the way that the regulations are written, the standards are written.
So, it says electronic or a hard copy, so you’re getting this push more and more to the language of digitalization but it’s hard for a regulator to come out and say, “You must go digital,” because then, they’re going to say, “Well, who’s going to pay for that?” So, what they say is you either have to have electronic or a hard copy readily available upon request.
AS: Okay, yeah. There’s a bit of work, I guess, in moving the industry forward. The other question I was thinking was just around … I mean, it’s clear that you’ve got a wealth of expertise. I mean, just listening to you talk now, you’ve had the experience not only from the executive level but the end user. One of the things that we’ve noticed in the survey of [Apec] as well, is there’s a lack of technical expertise which causes, I guess, to be gun shy about digital transformation. How do you go about acquiring more technical expertise that can give your company confidence to make the decisions like yourself? You can just make this decision because you know what the problem, you know what the solution is. Where do you find that technical expertise? How do you get educated?
MF: From a Deepwater Subsea [perspective], or how do we educate our customers?
AS: Well, from your own experience or how you educate your customers. Just how do we up the level of technical expertise that allows people to digitally transform?
MF: I think the biggest challenge with other organizations is when you talk about the oil and gas industry for example, things have been done the same way for generations, right? And I always say the problem that the industry has is, and some people don’t like it when I say this this way, if I go back in time to when the industry started, it was mom and pap who owned a rig. It was on their land, and it was their equipment, and if you didn’t like our rules, then you go away and we’ll find somebody else. Then, we started moving towards the offshore industry, so then, you had smaller companies, not mom and pops. We started getting into corporations, so you have people who have done things the same way for generations or years, decades, as an industry. And now, you have this big shift towards digital, right?
So, I’ll go into companies, and I’ll show the real-time monitoring. The first thing that comes up is they’ll say, “Oh, it’s Big Brother looking over my shoulder.” And I say, “Well, what if it was Big Brother protecting you instead of looking over your shoulder?” Like, hey, look, I’m your big brother, I have your back. I’m not Big Brother eye in the sky, making sure, looking for you to make a mistake. So, what I tell people all the time is the value of the digitalization is it gives you the freedom to go do your job. Unfortunately, guys who are not in the digital era are still the guys that go, “Well, what’s the value of this? You’re asking us to invest and all of this technology, how does it change how fast we can drill a hole in the ocean”?
Well, it doesn’t. What changes is the guys who are actually doing the job, how do you document that, so if and when a Macondo happens, you have all the objective quality evidence ready to go. For us, it’s pretty easy because internally, Deepwater Subsea, because I’m a tech geek, I like my tech toys for the most part. Sometimes I’ll buy something and it’s like, oh, cool, we get to play with this. When do we ever use it? Probably never but I think it’s let’s figure out a way how to use it, right? I bought a 360-degree camera many years ago, I went offshore, I stuck it inside a blowout preventer, I stuck it right into the middle of it. I sat there for a couple of minutes, pulled it out, turned it over, stuck it back in, and I was like, “Okay, cool. I got a 360 view of the inside of a blow-up preventer.”
Fast forward a couple years, iOculus Go comes out. Now, I can put on inside of virtual reality, log into my YouTube channel which is where my 360-degree video was, and I can stand there looking like I’m inside of the blow-up preventer, looking around, doing the inspection. So, I play with technology to try to push us to move forward, but I understand the value that technology can bring, but at the same time, I understand it still has its limitations. But it when it comes to bigger organizations, you really just have to be that change insurgent who really wants to drive change for the better. And if you don’t have the people, the stakeholders who believe in it, you can talk change all day long, and digital transformation, and you might as well be talking with this brick wall because it’s never going to happen.
One of our customers who we just recently signed an agreement to monitor all of their drill ships, they’ll be the first in the oil and gas industry to basically outsource the entire monitoring of their fleet coming to us. Their CEO is very much digital. He is all about digital, and the faster he can get his company up to digital or the digital transformation, to him, it’s a competitive advantage to be able to say, “Look at what I can show you on the iPad, look at the technology that we’re using. If you hire us as a company, this is what you’re going to get from an operator standpoint.” He’s all in on it.
AS: Oh, yeah.
MF: Others look at it and they go, “Yeah, that’s cool but it’s a fad, and it’s going to go away.” It’s hard for them to grasp it.
AS: Well, that’s the way it is then, unfortunately. It sounds like this is a cultural thing, really. So, you need that culture in the business, and it does start with super leaders, I guess, people who are really in tune. Mike, I would be completely remiss if I didn’t ask where you thought this industry was going as well. We’ve talked a lot about, I guess, unsticking the roadblocks of digitisation but let’s talk about the perfect world. Let’s talk about once we can remove some of these roadblocks and start digitizing. What are some of the potential outcomes of it? I mean, you were saying before just with the 360 and the Oculus Rift, the kind of things you could achieve there. What are we looking at next?
MF: So, I was trying not to get too excited about this one.
AS: No, this is my favourite part. Let’s get excited.
MF: In my super geeked, perfect world, if they just said, “Mike, here’s technology. Make it happen,” right? From an operations standpoint, I’m the guy in the rig. So, if I look at all of the information that we have today, right? And I think about what that guy has to do for his job, the more I can automate that process, the easier his job’s going to be but the more efficient it’s going to make him work. Where I’m going with this is, we’re monitoring the equipment today, so the BOP control systems are sending in all this data. We’re seeing things now that we’ve never seen before. I can see in real-time as a failure starts to happen. I can overlay the trends, I can take the digital state, and really paint a picture that no one’s ever seen before.
The reason they’ve never seen it is because it’s on an operator interface, an HMI human machine interface where they’re just looking at a gage and some readings. Well, when I get the actual values in, I can, not manipulate but I can visually manipulate that data in a way that shows a different story, I can now give this guy information that he’s never had when it comes to having to make decisions.
Moving forward, the piece of equipment fails. I’ve loaded up the system, whatever system it is, with the make, model, serial number, historical data, all the KPIs, operational parameters, everything, all the variables that have happened. Instead of him having to go to a book and look all this information up, when did we install it? What’s its part number? What’s its make, model? All this stuff. It’s already loaded into a system. He just goes in and says, “This piece failed.” It pulls all the information in; the forms fill out automatically with the real-time historical data.
All he does is reads it, checks it, checks the box, pits submit. It goes off to the next level, takes all the information from the findings of the failures, turns that into KPIs, pushes it back out, and says, “Hey, guys, in a fleet, we’ve had 15 of these failures,” which now turn around to management and says, “Hey, look, these failures all happened within seven days of the blow up preventer being ran. Are we actually the ones causing by doing the maintenance that we’re doing”?
Then, you go back, you look at the maintenance optimization of when did we last this PM? Why are we doing this PM? You can do so much with data and just technology but where really, for me, it gets super cool is some of the things that SmartPlant and the live PN IDs, and some of these other things which is I take a PN ID drawing, I take a schematic basically, and I am in technical field support or I’m in operations. I have to go back to my customer and say, “Hey, we have a problem.” The customer’s not a technical guy, he’s a drilling engineer, for example. He’s a maintenance supervisor, he’s whatever industry you’re in. He’s not the guy doing the work, he’s the guy that’s being briefed. I bring this smart PN ID, pull it up, and say, “Here’s the problem.” I click on a button; it pulls up all the historical information of that component in the PN ID. And better yet, if I want to show him the live trend of what’s going on with that piece of equipment in real-time, I just click a button and the trend shows up on the screen.
It’s all there today with technology that’s offered from Hexagon. The beauty is when you bring it and you wrap it all together, it’s all sitting right in front of you. The problem is … We talked about it today in class and I said, “Hey, what do you think about this world, right? This perfect world.” The first thing that came out of one of the guy’s mouth is, “Someone’s going to have to load all that information in.” And I’m like, “What if you didn’t have to do it? Let’s just forget that anybody in this room had to load the information. What do you think?” “Oh, that’s an awesome idea. That’d make my life so much easier and so much efficient.” Because what happens is when they have to go look things up, it turns into a pencil whipping exercise because I got 15 other ones I got to fill out, plus I got all the other paperwork I got to do. How do I just whip through it? It’s like serial number one, two, three, four. No one reads these things anyway, so why do I care about the inputs to it?
But if I have a system that has all of that, and now from an upper management standpoint where I have to make decisions based on key performance indicators, let’s get KPIs that actually utilize real data versus how many times has thing failed? Or is this thing the same thing as the last thing that failed? No, it’s actually different. It’s a shuttle valve or it’s component X but there’s 15 different designs of this component. We lump it together, and just call it the same as all the others but they’re not the same. Now that I’m able to get into a deeper level of analyses, I really start to understand the equipment more than what I did before, all using technology that’s there today. You just have to step back and go, “What if the challenge wasn’t what do I do, it’s what do I not know that I can do?” And if I go, “I have 4,000 pieces of data sitting in front of me,” build the perfect system, build the perfect picture back to the customer. Now, you look at data differently versus somebody giving you a trend that shows up on the screen, you’re like, “What am I supposed to do with that?”
How about this? Here’s a blank canvas, what are you going to do with it? Then, the magic starts to happen, and that’s where I get excited, and start really going, “Well, if we can do this, well, can we do this? We can do that? Well, what about this?” So, the sky’s the limit but then, to the Oculus Rift and the 360, and all of that, that to me is the future of training because now, I’m taking the guy from the digital side, right? This guy’s worked in operations, he’s a mechanic, right? He’s a hands-on guy, and I say, “Let me show you the soul of your actual BOP control system. How does this thing react when you push the button? What is it doing on a day to day basis?” You’ve never seen it before, and it’s like a doctor who finally hooks you up to an EKG, and it’s like you can feel your heartbeat but let me show you what it looks like when it’s actually beating.
So, when guys start to see, you mean that’s really how the system works, you have a new opportunity for training and developing the next generation of the operator, versus a guy that goes, “When I push the button, this happens. If it starts to leak, I’ll call somebody else.” You don’t have that luxury when you’re 4,000 miles away or you’re halfway across the world. For us, in our world, and for operations in subsea and blow up preventers, I can’t touch it. It’s thousands of feet away, 5,000, 10,000 feet away in the ocean floor. I’m looking at the control system and the trends to tell me the information that I need. The problem is there’s guys that never seen it before because they’re just used to a radio gage that sits on a display. Now, I’ve taken away the mystery of it, and I can teach you how your system actually works, digitally.
And we can be here, you can be in Australia, you can be in the UK, I can be in Houston and say, “Guys, look, this is what the system’s doing in real-time.” Never before have we been able to do that, but that data’s been sitting there in these control systems since we started using multiplex systems 20 years ago, which is now the digital half of what we do because of Macondo, really forces the regulations. Because one of the big things with Macondo was, in the initial hours when the incident place is, what is the status of the BOP? Nobody can answer that because the rig was on fire, the cruise was on lifeboats being rescued, and we were in the office trying to help troubleshoot, and secure the well, stop the flow. But nobody knew what the last day of the BOP was.
Now, the US regulator comes out and says, “Mandatory, you need to have real-time monitoring, and it needs to be streamed back to the beach.” People said, “Well, why do we need it streamed back to the beach?” What happens when the rig sinks or if satellite comms are lost? What is the last day of the BOP? Instead of fighting regulations, if you understand where it came from, then you go, “Yeah, that makes sense.” The digital world is coming but too many people want to fight it versus just embracing it, and letting it happen. It’s going to happen.
AS: Yes, more about the value that you can get out of it. I mean, even looking at the training aspect of things. A lot of people talk about how digitisation might take jobs away but it’s going to create a whole new raft of jobs. You think about someone who’s being virtually trained by VR, ultimately, in 10, 15, 20 years’ time, that could actually be a job where they’re actually remoting into some sort of robotics field. Just the potential is limitless.
MF: Yeah. The thing for us, which is really interesting, is if you think of the way it’s done today, so guys are on the rig, and he takes a picture. He’ll take three or four pictures, he’ll send it into you, and he’ll go, “Okay, here’s the pictures of what I saw.” Well, where is that exactly at? And it’s like, well, it’s inside the blow-up preventer. I know but what’s the orientation of this picture I’m looking at? Versus he sticks in a 360 camera, and he sits it there, and it’s like, oh, I can see it exactly because I can actually spin around in my office, and see what …
And it looks funny on the outside, to watch one of your co-workers spinning around like he’s inside the blow-up preventer. But the point of it is I’m there almost in real-time, to where even if it wasn’t real-time, and the guys say, “Hey, look, I got a problem. Can you take a look at this video for me?” He just uploads it, I throw it in Oculus Rift, and I can see it, and it’s like, oh, okay, I see exactly what you’re talking about. I can orientate myself where inside the component it is. That, to me, you’re taking things to another level.
With technology today, and 4K video, and a lot of these other things, it’s different with the latency issues that you’ve had in the past. I think you’re going to run into a bigger problem with intrinsically safe devices, and that’s where the technology limitations are going to be, or the cost are going to be so high. But you’re starting to see now with streaming data back to the beach. Some people say, “Oh, well, it’s a bandwidth issue.” It’s a regulatory issue. It’s like, look, I’m sorry that you’re going to not be able to stream Netflix from the rig but US regulations require X, Y, and Z. So, unfortunately, where one regulation requires digital technology and streaming data, somebody else looks at it as a business opportunity because now, the companies that are running the satellites and charging for data, go, “Let’s up the cost of data.” Because now, you have to stream data back to the beach.
So, you get this, “We don’t want to send all this stuff because the cost is so high, but I have to do it because the regulations are so high.” But back to your point of the future, if companies would embrace the opportunity to be able to take digitalization and in so many different forms and fashions of what they can do offshore, training, live PN IDs, digital checklist, real-time monitoring, your operational excellence will quickly shift in a different direction because we have customers outside the Gulf of Mexico who say, “Well, you guys do that in the gulf, this real-time monitoring, because it’s regulator required but what’s the value to us outside the Gulf of Mexico?”
I say, “Hold on a second. Just because US regulator says you have to do it, what’s the value of understanding in real-time, the status of your blow preventer?” “Well, it’s important because we know this, this and this.” So, I’ll ask them questions back that have nothing to do with regulations, but it’s like you’re sitting in Houston and you have a rig in West Africa. Don’t you really want to know what the true status of that blow-up preventer is? Well, yeah, I do. How do you know what it is at this moment? Well, I don’t.
So, it’s not about US regulations, it’s about how much are you willing to truly understand what’s going on with your equipment. Once they can understand, wow, I really see what the value of this technology is, then they start selling it for themselves. I’ll get a call that says, “Hey, we want to put this on four other rigs.” And I’m like, “Whoa, where did that come from?” It’s like, “Oh, we saw in the Gulf of Mexico. It’s awesome, and we want it in our rigs in West Africa.”
Okay, great, but as I tell our team, it’s not the new customer coming on that’s the value. It’s the value we give back to the customer who then says, “I loved it on my rig here, I want it on my rig in Brazil, West Africa, Asia, India.” Because it’s the value that we give back to them. Because they’ll save 10-fold, 100-fold more than what they invest in us from a monthly subscription cost, but I don’t care about that. To me, it’s how do we prevent another Macondo from happening, which is training, making sure that people are doing the work that they’re supposed to be doing. And then, how do we add the greatest value back to the customer when it comes to let me show you what’s going on. Let me help you when the US regulator comes in or any regulator comes in, and says, “Prove to me, Andrew, that you’re really doing your job.” And you go, “Cool. Hold on a second. Here’s my digital checklist with all the objective quality evidence attached to every item that I’m supposed to check as part of a regulatory compliance issue.”
And they go, “Okay, next,” because the more that you can demonstrate upfront … One of my first bosses in oil and gas say, “If your paperwork’s clean and your shop’s clean, and you look like you know what you’re doing, people will stop digging around looking for things that you’re not doing. But if they come out to your shop, and your paperwork’s a mess, and your shop’s a mess, people are going to go, you guys are probably a mess in a lot of other places.” I’m very transparent, even with the regulator. They’ll say, “Well, how do you guys do this?” I’m like, “Cool, let me show you.” Because I want them to understand how the process works, so when it comes time to, hey, customer X utilizes Deepwater Subsea, the US regulator goes, “I got it. The Janice24 platform does everything that we need it to do.” Versus, does it really do what it’s supposed to do or is just that smoke and mirrors, and good marketing that people are putting out there?
For me, I’m very transparent. Let me show you, let me show you this because I get excited about it, because we’ve never had the opportunity to do the things that we’re doing today, and it’s the digitalization of the work that we’re doing that allows us to have this opportunity.
AS: Yeah. I mean, Mike, thank you so much for sharing this with us today. It is, it’s super exciting.
MF: Oh, I could talk about it for days on ends.
AS: Oh, yeah. That’s one of the reasons why I’m so excited about as well. I think this is the future, and it’s part of the reason why I got involved with the industry. I’m nowhere near as technically astute as yourself but there’s so much opportunity for the value of digitization to really take over. And yeah, it’s just very exciting.
MF: I mean, I think the big thing is if you look at kids today, right? I mean, my chief administrative office has a young son, and he’ll come to the office periodically, and grabs his iPad, he sits down, he pops it open, does his thing, and you’re like, okay. Well, he’s six, and he’s talking about, oh, this dinosaur was from this age, and this and this and this. I’m like, “When I was six, I was in encyclopedias and really having to figure out how to say things.” Technology’s allowed people to grow, children to grow. When you embrace it at that level, from a learning and just a development standpoint, there’s huge opportunities for it. But unfortunately, a lot of people look at the negative side of it and go, “Why do we need this technology? It’s this way for 30 years. This is the oil and gas industry.” And it’s like, yeah, it’s oil and gas industry. You do realize that every other industry around is going digital but us? And it’s like, why is that?
We talk about being an industry of change, and we want to be on the forefront of technology until you go to implement technology, and everybody’s like, “Whoa, hold on a second.” Because it disrupts the status quo, and it’s because it’s happened so many times because it’s a sweeping change that people try to make. I used to say all the time, it’s like here comes the flavor of the month or the flavor of the quarter. Just wait long enough, and the next new initiative will come along. Whether it’s whatever term that corporate wants to use or the guys will land, and everybody’s pumping their fist like, yeah, yeah, we’re going to do this. Then, this chopper leaves, they’re like, “Yeah, we’re not doing that stuff.” The same thing happens with some of the technology, right? We’re going to roll out this new maintenance system, and this is going to be thing we’re going to go for, and everybody’s going to embrace it.
And then, you start hearing the people who are supposed to be the champions, like this doesn’t work. This system really sucks really bad but corporate said we’re going to use it, so we’re going to use it. And by the time it gets to the end users, the guys are like, “Nobody believes in it. We weren’t trained in it. Why do I even care about it? I’m just going to go do my job.”
AS: Was an [inaudible 01:01:32]on live, but it was an awesome example. I can’t quite remember the guy who was speaking about it, but he was saying that when we do … The topic was around the industrial Internet of Things, and how do you leverage IoT for your business. He was saying that we roll it out in very specific departments, and if it’s a success, the number one metrics is it gets a pull.
So, other departments hear about the success that they’re having with it, and then they go, “We want that in our department.” That’s how you’re meant to roll it out, rather than just going broad sale. Here’s the new technology, everyone figure out a way to work with it, and go to your champions to help out.
I think there’s so much wisdom in that. Get the runs on the board, and have people want it before you can actually just throw it out there because then, you got the sound cost fallacy. You’re just going to keep chasing your tail.
MF: That’s right, that’s right. Unfortunately, if you get the wrong champion, it’ll die faster than it has an opportunity to grow. So, I’m always teasing my peers, and my customers are like, “Oh, look at this thing.” There was a joke couple years ago, it was like, oh, look at the new technology Mike found. Because we were trying to build that solution, so it was like, oh, every time you come to the office, you got this new thing, Mike. And it’s like, one day that new thing is going to be the thing. I just have to find out which thing it is. Fortunately, with PI systems and j5, and Hexagon, and the entire suite of things that are coming together, I finally found that solution, but it was always that challenge of never being satisfied with the status quo, and how do you constantly improve it.
For us, even my systems team is like, “Great. Mike found another software. Here it comes, we’re going to get stuck with it.” It’s like, guys, look, from the system side, you don’t understand it because you’re the systems team. From the operation side, our guys are like, “Anybody seen that manual? Where’s that drawing at?” It’s like, if you just took the hourly rate of what the entire team spends a day chasing documentation, that software gets really cheap really quick from wasted man hours. So, we have to sell the fact of, hey, look, what if we could this, and we could this?
So, a lot of the times, I’ll sell my customer on stuff, and show them what we’re doing, and I’ll watch how excited they get because they’re actually the end user. And the more they get excited, like, “Oh, this is amazing,” I’m like, “This is an easy investment to me.” Because I already know that the guy at the end, there’s no cost to him but it allows him to see how much we’re utilizing it to move forward. So, it’s a job security as well, like hey, look, why would I want to go anywhere else when this solution delivers everything that we’re looking for?
But to your point that was … You can’t come across an industry, and just go, “We’re going to do this throughout the entire organization,” because as it fails in one department, they’re going to talk to the next one. It’s just going to keep having this avalanche of effect, and just by the time you’re done, you should’ve never even have invested in it.
AS: It’s time. I mean, it even happens in marketing, so there you go. Yeah, it’s one of those things. Mike, I think we are out of time.
MF: Cool.
AS: Look, honestly, I would love to keep talking, and maybe we can after we stop recording.
MF: Technology allows us to do it from anywhere in the world.
AS: Exactly, right. I mean, is there anything that you wanted to give a shout out to or a plug while you got the opportunity with our audience?
MF: Yeah. I mean, the big thing for me is obviously the Hexagon team, and the thing that I love about the technology is when you’re working with teams like the Hexagon guys, and the systems teams, and the technical support teams, they also get excited about trying to help you. So, for me, anytime I get an opportunity to thank the guys that really work behind the scenes … Obviously, no offense, the marketing team gets a lot of the upfront, the sales team gets the upfront. It’s the technical teams behind the scenes where it’s like, hey guys, look, is there any way that we can do this? And I’m like, “Oh, let’s go back and see if we can tweak the software. We’ll come up with some solution.”
So, there’s a whole list of people but I mean, for me, it’s really giving thanks back to your organization, and the teams that see … Because we’re really the new kid on the block. We’re the 2019 Trailblazer Award recipients, and I sit back, and I go … I mean, that’s really impressive but it’s just, what I mean is it’s every day, we do it but to be recognized whether it’s like, guys, look, we’re the trailblazers because you’ve given us amazing tools to use. So, the more that you guys challenge yourselves to come out with better products and services for us, it just makes our job that much easier. So, thank you to all of your guys’ teams, from the marketing team, the sales team or the technical team. Really, we couldn’t do it without you guys.
AS: Oh, Mike, that’s too humbling. Look, thanks very much. I really appreciate it, and-
MF: No, appreciate the opportunity.
AS: Yeah, no, no. Look, obviously, thanks very much, and hopefully, we can keep this conversation going with other people offline.
MF: Cool, sounds good.
AS: Yeah.
MF: I’m here for you guys.
AS: Yeah, thanks very much.
MF: All right.
AS: Cheers.
BK: Andrew and Michael, thank you very much! For more information about today’s topic, visit hexagonppm.com. And of course, to learn even more and listen to additional episodes, head over to hxgnspotlight.com. Thank you for joining us here on HxGN Radio!
