Nothing ever goes "according to plan" ... so, now what?

In my previous post, I referred to “disruption management”. The application of disruption management techniques can use decision support software and analytic methods to cope with the impact of disruptions on a plan, a schedule, or an operational system. This helps address complex practical challenges in asset-intensive industries: for example, how to reach goals while minimizing the negative impact caused by disruptions; and, how to get back on track in a timely manner while effectively using available resources.

Several concepts from disruption management are relevant to the energy and utility sectors. First, let’s look at what we mean by “disruption”. According to Clausen, Hansen, Larsen and Larsen, “… a disruption is defined as a situation during the operation’s execution in which the deviation from plan is sufficiently large that the plan has to be changed substantially.” The authors go on to explore what happens when disruption occurs. Typically, the process to manage disruption is manual because the timeframe to take action and recover from the disruption is short and because the tools used to generate the original plan or schedule are too labor-intensive or cannot be used effectively in an ad hoc, interactive decision support environment.

Manual methods are used as a stop-gap. However, a manual approach, even if supported with automated spreadsheet or scheduling tools, cannot really contend with high degrees of complexity. As a result, sub-optimal or even infeasible decisions are made, with negative cascading impact. “On the fly” decisions are made to “just get going again”.

The result is that the operating plan quickly becomes decoupled from the medium and longer-term plans of the organization (e.g., in the upstream oil and gas industry, drilling operations execution planning becomes decoupled from reservoir management, field development, production and capital expenditure plans). This decoupling of the “fast loop” (operations) from the “slow loop” (planning) can result in significant misalignment of results from expectations within a very short period of time. When there is a lot of disruption, the problem becomes more acute.

In a world where it is getting increasingly difficult and expensive to obtain oil, the need to respond to disruption is important if we are to rely on the planning and execution of operations in asset-intensive supply chains. Sophisticated decision support applications are available today that can make a significant difference in our ability to recover from inevitable disruption, through decreased response times and measurably increased decision quality.