| Terminology | Definition |
| 5 whys | A method of root cause analysis that entails the progressive asking of "Why?" at least 5 times or until the root cause is discovered. |
| 5S | A method to create a clean and orderly workplace that exposes waste and errors. |
| Accountable | Accountability equals Responsibility plus Authority |
| Activity | The work or effort needed to achieve a result. |
| Activity Description | A statement specifying what must be done to achieve a desired result. |
| Andon | A signal to alert people to problems at a specific location in the work process. |
| Authority | The power or right to take decisions. |
| Batch Processing | The movement of products through the manufacturing process in large numbers as a group. |
| Big Hairy Audacious Goal (BHAG) | A highly focused, compelling goal that is seen as attainable but the means to achieve it is not yet known. |
| Bottleneck | A process that constricts and limits the flow of the overall process. |
| Breakthrough Kaizen | See Kaikaku. |
| Capacity | The rate at which a process can produce products in a continuous manner. |
| Cause and Effect Diagram | A graphic that layouts out the various causes that effect a result. Commonly called a fishbone diagram. Officially known as an Ishikawa diagram. |
| Change Order | A document that authorizes a change in some aspect of a project. |
| Changeover | The time it takes to convert a work center from one process to another. |
| Consult | Seek an opinion. |
| Continuous Flow | The state where products move through a manufacturing process one at a time, without stopping or waiting - similarly the way people deliver a service. |
| Control | The practice of monitoring progress against a plan so that corrective steps can be taken when a deviation from plan occurs. |
| Critical Path | The longest sequential path of activities that are absolutely essential for completion of the project. |
| Current State Map | A Value Stream map that depicts the current work flow. |
| Customer | The user of the project deliverables or product. |
| Cycle Time | The total elapsed time from the time a task, process or service is started until it is completed. |
| Decision | A choice made from among several alternatives. |
| Decision Analysis | Is a methodology for facilitating high quality decisions. |
| Defect | The output of a process that fails to meet the required specification or performance standard. |
| Deliverable | An agreed outcome. |
| Deviation | Any variation from planned performance - usually in terms of schedule, cost, functionality, operability or scope of work. |
| Failure Mode and Effect Analysis (FMEA) | The method used to identify, assess and mitigate potential failure modes in a product, process or system. |
| Fish Bone Diagram | See Cause and Effect Diagram |
| Float | A measure of how much an activity can be delayed before it begins to affect the project finish date. |
| Flowchart | The graphical representation of all activities that occur in a process including activities, delays, decision, movements, wait time, etc. |
| Future State Map | A Value Stream map that depicts the desired (improved) future work flow. |
| Gantt Chart | A bar chart that indicates the start date / time, the end date / time and the duration of each activity in a project. |
| Inform | Make known the outcome of decisions. |
| Inventory | The raw materials, purchased parts, work in process and finished goods that are not yet sold to a customer. |
| Ishikawa Diagram | See Cause and Effect Diagram |
| Kaikaku | Radical improvement activity that causes a step change in the process. |
| Kaizen | Incremental and continuous improvement of an activity to produce more value and less waste. |
| Kaizen Blitz | Massive focus on change of a process or activities within the process in a short period - akin to Kaikaku. |
| Kanban | The organization of materials, components or work in process that triggers replenishment when required for smooth work flow. |
| Lead time | The elapsed time from the initiation of a project, product or service until completion in terms of sale to the customer or delivery of economic value internally. |
| Lean Manufacturing | An improvement methodology based on the Toyota Production System. Focuses on delivering maximum value with least effort. Name coined by MIT in a landmark late 1980\'s study (doing more with less). |
| Learning | The process of gaining insights from the current process / activity or new knowledge from other processes / activities whose implementation will improve the planned or current process or activity. |
| Milestone | An event of special importance, usually representing the completion of a major phase of project work. |
| Muda | Japanese term for waste - any activity that consumes resources but creates no value in the view of the customer. |
| Ongoing Operations | Repetitive work with no defined end. |
| Peer Review | A review of a design or plan made by a team of experts with the aim of increasing confidence in the design or plan. |
| Process | A time ordered set of activities that transforms material and information into a defined output. |
| Product Family | A group of products or services that have similar attributes which enable them to be grouped into common process steps for completion. |
| Project | Work that happens one-time only and has both a clear beginning and end. |
| Project Execution Plan (PEP) | A plan that provides a macro view of what is to be done - it summarizes the project itself. |
| Project Management | The planning, scheduling and controlling of those activities that must be performed to achieve project objectives. |
| Project Management Plan (PMP) | A plan that summarizes how the project will be managed. |
| Project Manager | The person who has total responsibility for ensuring that the project is completed on time, within budget, within scope and at the desired performance level. |
| Purpose | The reason an organization exists - besides making money! |
| Quality Assurance | The design and implementation of design features and procedures to ensure that specification can be verified. |
| Quick changeover | A method of analysis and improvement to dramatically reduce set up time. |
| RACI Chart | A matrix that defines roles in terms of who is Responsible, Accountable, Consulted, Informed. |
| Responsible | Performs the work. |
| Risk | The possibility that something can go wrong and interfere with the completion of project work. |
| Risk Log | An interactive log containing a description of all identified risks, their rating and the actions planned to overcome them. |
| Root Cause Analysis | A method to break down a problem to identify and correct the underlying or "root" causes. |
| Scenarios | Alternative sequences of possible future business environment events (stories about the future). |
| Shadow Board | A board with images showing where objects are stored on it. |
| SMED | Single minute exchange of dies - tools and techniques to dramatically reduce change over time in a process (9 minutes or less). |
| Spaghetti Diagram | A graphical representation of the movement of materials, information, tools, WIP and people in order to identify and remove wasted motion. |
| Sponsor | The person who orders that a project be done. |
| Stage Gates | These are defined management decisions that are planned at discrete points in a controlled business process. |
| Stakeholder | Any individual, group or organization that can affect, or be affected by, the project |
| Standardized Work | A clear, written definition of how a process is executed. |
| Statement of Work (SOW) | A formally agreed list of the goals, constraints and success criteria for a project. |
| Strategy | the pattern of moves and approaches devised to achieve organizational objectives |
| SWOT analysis | Analysis of an organization's Strengths, Weaknesses, Opportunities and Threats. |
| Throughput | The amount of product or service that can be produced by a system within a defined period of time. |
| Total Productive Maintenance (TPM) | A proactive approach to maintaining equipment that addresses autonomous maintenance, planned maintenance and predictive maintenance. The aim is to minimize production losses from equipment malfunction. |
| Toyota Production System (TPS) | The manufacturing system by Toyota Motor Corporation that became known as Lean Manufacturing. |
| Trim tab principle | The rudder of a ship contains a trim tab, the rear edge of an aircraft wing contains a trim tab; these are small movable surfaces that have a huge impact on the control of the craft. The principle states that a small adjustment made in the right place and right way has a huge impact. |
| Uncertainty | Something that is partially or completely unknown. |
| Value Delivery System (VDS) | The end-to-end system that functions to deliver value to customers. |
| Value Stream Map | A graphical representation describing the steps and their duration in a process to produce a product or service including wait points and information flow. |
| Values | Standards an organization lives by. |
| Variance | Any deviation from plan (cost, schedule, performance, etc). |
| Vision | A description of the future you wish to create. |
| Work Breakdown Structure (WBS) | A method of subdividing work into smaller and smaller increments to permit accurate estimates of durations, resources required and costs as well as to assign tasks. |
| Work in Process (WIP) | In process inventory of product that has started to be produced but is not yet finished. |
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Testimonials
We have seen significant improvements in results and have adopted the principles in our planning and operations efforts.
John’s emphasis on rigorous planning has resulted in tangible and measurable results in the area of drilling and completing wells. A true step-change.
...substantial improvement in product delivery and resultant reductions of inventory. The catalyst for these new processes was the Strategic Planning workshop lead by John de Wardt.
John de Wardt provided us with a straight forward, hard driving, no nonsense approach to strategic planning that is still helping us define and achieve new business goals.
His insight into the oil and gas industry is invaluable, and his knowledge of best practice in manufacturing has added measurable value to several of our investments.
His recent corporate strategy development work resulted in a set of strategic initiatives that are already beginning to deliver value only a few months into their implementation.
Case Studies
World Class Wildcat Deepwater Well in N Sea
In July 1999, Saga Petroleum (now Norske Hydro) completed their 4103m remote "Gjallar," wildcat well in 1352m water depth. The well was planned using DE WARDT AND CO's Lean Drilling program and achieved a performance result significantly ahead of other deepwater operators (see plot on left). The results for this project are best described by this quotation from an IADC/SPE paper (#51980) published by Flemming Stene of Hydro (formerly Saga) and Peter Aird of Kingdom Drilling. "To optimize the planning process and make further improvements, Saga engaged John de Wardt to apply his Lean Drilling program. This is a planning method based on giving 'ownership' of the project to all involved parties; in the operator, drilling contractor and service companies, both offshore and onshore. Each party is required to take full responsibility for their input, both in the planning and execution phase, in contrast to the usual approach in which 'ownership' is concentrated mainly on those in charge in the operating company. De Wardt's method also puts great emphasis on risk management and contingency planning. The planning process continued until spud in early June 1999, a duration of 3 months." Significant reduction in non-productive time was achieved in the most challenging section - see diagram on right.
Consistently Differentiated Performance
The application of Lean Drilling to the Norwegian operations of bp, TotalFinaElf, Statoil and Saga (now Norske Hydro) has differentiated the drilling performance of these operators when compared to their internal and external peers. With daily drilling costs in this region ranging from $150,000 to $350,000, the savings achieved are worth many millions of dollars. The plot on the left presented to the AADC in Houston on November 13, 2001 shows the step change achieved by bp Norway in comparison to their regional peers. The plot on the right shows how the clients of DE WARDT AND COMPANY achieved the best performance on a comparison of depth versus time for all Norwegian deep-water exploration wells.
