Thursday, August 31, 2006

"Oilpatch slow to deal with labour shortage"

In the Calgary Herald yesterday there was an article that notes the following from a survey report by Deloitte Consultants.

"I think the oil and gas companies have largely taken the supply of labour for granted - and that's where the big change is."

"Just as revealing said Stephen Diotte, is that less than 40 percent of oil and gas companies have actually identified the critical skills they need to expand their business at a time when the sector is booming. "

    Well come September, I'll have the solution for the industry.

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    An Apple and Sun merger?

    Of all the mergers, this one I can see the logic and the possibilities.

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    Sunday, August 27, 2006

    Executive Summary

    It was in May 2004 that I published the preliminary research report entitled “Plurality should not be assumed without necessity”. (Readers are encouraged to revisit the preliminary report to assist in the context of this report.) The main thrusts of that document were its two primary research findings. The first finding was that the key organizational construct of the oil and gas industry is the joint operating committee. The joint operating committee is the legal, financial, cultural and operational decision-making framework of the industry. If the industry were to move the accountability framework in line with the four frameworks of the joint operating committee it would achieve greater organizational speed and innovativeness. The other research finding was that the software the firm uses defines the organization. Noting “SAP is the bureaucracy” it is apparent that to change the organizational construct requires that systems be developed to support the proposed organizational change.

    The preliminary report also contained a project management proposal to build these systems around the joint operating committee. This budget was in the $70 – 85 million range and would require four years to complete. The budget of that system may remain within that scope; however, this final research report recommends that the industry pursue a proof of concept. This proof of concept is to build a Petroleum Lease Market application to start the organizational transition to the joint operating committee. This application’s scope has been budgeted at $2.6 to $3.5 million.

    The four cornerstones of a technical vision.
    Critical to the success of any prospective software development would be the impact of any future Information Technologies (IT). I am including a technical vision consisting of four key technologies, and describe how the future may be affected by these technical changes.

    IPv6 (2 to the power of 128 in terms of addressing space.) enables the elimination of the technological model known as client – server. Replacing it with static IP addresses that can identify anything and everything. Enabling any electronic device that is connected to the Internet to be monitorable and controllable. I believe the engineers and geologists can and will do with this level of static addressing is unlimited.

    The second element of the vision involves Java and the incremental nature of typed, object oriented programming languages. Where the predictability and control of systems is achieved through the strong implementation of strict typing.

    Java is also enabling the exception handling capabilities and asynchronous process management that is critical to handling intra-partner transactions and interactions.

    And finally wireless Internet through Wifi and soon Wimax, enabling electronic devices to be connected at low costs and high speed and in turn eliminating the “last mile” issues of technological access.

    These four technologies will be revolutionary when applied over the joint operating committee as the organizational focus. This technical vision provides the industry with the organizational capability to facilitate rapid innovation in a controlled and managed environment.

    Partnership Accounting.
    I will then go on to discuss "Partnership Accounting" and how an algorithm can capture the unique and demanding accounting and reporting needs of the producers represented in the joint operating committee.

    A new accounting dynamic is introduced by using the joint operating committee. This accounting dynamic enables the interactions to be quantified in an algorithm that although complex, addresses the accounting related issues that traditional ERP systems can’t handle.

    The Partnership Accounting difficulty comes when all participants of the joint operating committee have been contributing people, financial and technical resources, and direct costs on behalf of themselves, and / or, with other members of the joint account. Through the JOC each producer’s collective resources are pooled to attain the highest level of technical capability, management and tactical deployment, which is sourced from the partner companies.

    These costs and resources are being incurred on each producer’s behalf and may not be shared, but may be eligible to offset their obligations to other partners, be distributed equally among the producers interests, or need to be recognized by the joint operating committee irrespective of their source and nature. This is further complicated by the fact that many of the internal charges and overhead allowances that have traditionally been charged to the joint account also become redundant. These overhead styles of costs are replaced by the specific costs that were directly incurred by the producer, as represented in the joint operating committee. The system will capture these components as they are incurred by the employee / worker / investor / consultant / producer in an active job costing state as the user is logged on.

    The nature of the oil and gas business is unique in many ways and this Partnership Accounting discussion will capture many of the issues that an oil and gas system needs to address. For example:

    • Daily and monthly production volumes.
    • Differing currencies of producers.
    • Differing currencies of operations.
    • Currencies that relate different accounting issues based on the criteria of one being balance sheet vs. income statement accounts.
    • Spec vs. raw products and by-products.
    • Processing and gathering fees based on (non) ownership,
    • Imperial vs. metric reporting standards.
    • Nominations and or commingling of gas.
    Providing an unlimited set of possible reporting scenarios for each working interest owner. The partnership Accounting module’s algorithm needs to capture and deal with these nuances within this system.

    Military Command.
    I then by way of analogy, will note the traditional military command structure of corporals to generals as a replacement to the regular hierarchy. It is foolhardy to eliminate the hierarchy and lose some of the attributes of a control structure. I discuss how a similar military command type of structure can be used to enhance and augment the managements’ control apparatus. This also allows the human resources to be deployed in a greater diversity of situations, and have their tasks outlined and issued from a variety of producers as represented by the JOC as their employers.

    This military command structure will draw a parallel to the interactions of various military groups interacting under NATO. Where an army major of a branch of the U.S. military may have Canadian, French and / or British soldiers under his direct command. With these military personnel changes happening in a fluid, dynamic and ad-hoc basis.

    Linear historical perceptions vs. the logarithmic and exponential future possibilities.
    Stanford University Economist Dr. Paul Romer has captured what the future economical progress can be. In a world of limited resources it need not be a zero sum gain. The use of ideas has potentially logarithmic or exponential value creating capabilities. Progress and growth can be better attained through application of intellectual property within an industry.

    Innovation is the beginning of this process. And to attain the highest level of innovativeness, the Joint Operating Committee has been proven by this research to be the ideal organizational model for the producers. This will not happen however, until such time as the systems are developed and in place, and the system developers’ capability becomes an inherent part of the capability of the industry.

    Genesys value proposition.
    In addition to all of these topics of discussion I will reiterate the Genesys value proposition. A value proposition that is similar to Google's, where the costs of development are allocated over a larger base of users. Each user benefiting from the collective users purchasing power, demands and capabilities.

    Google is proving this is the nature of software. The value of this proposition is something that I don't believe has been fully implemented or realized by the producers. It is my supposition here that the Oracles and SAPs realize this latent value. It is therefore my assertion that the oil and gas industries overall costs of systems development would decline under this proposed model.

    Who would Henry Ford hire?
    I also want to ask a question of the people who work within the oil and gas industry. That question is, whom today, would Henry Ford hire? A question that is just as pertinent today as it was 100 years ago.

    Just as Ford needed a new "type" of worker for his assembly line invention, so will the prospective oil and gas producer. What type of employee will the producers need in this dynamic networked environment? What type of skills and capabilities should the oil and gas worker obtain to be optimally deployed in the future oil and gas industry?

    Calls to action.
    Last if not least this proposal will note and discuss the numerous calls to action from:
    • Oxford Analytica.
    • Harvard University.
    • MIT.
    • Energy Secretary Bodman.
    • McKinsey Consulting.
    • SEC Chairman Christopher Cox.
    • Sir John Browne of BP.
    • John Hagel III and John Seely Brown
    • and many others.
    These have become predictable in their message and their frequency. Many of these messages noting the time to act is now. And that is this proposal's message to industry.

    This proposal is a clean slate proposal. There are no constraints in terms of existing code or client base to deter from the focus of these developments. The attainment of this type of software and software development capability must be built from the start. It is therefore expected that this proposal will be accepted and funded as required.
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    Saturday, August 26, 2006

    A technological vision.

    More text back from the editor.

    A lot has happened in the past decade. Information technology has had its ups and downs and has provided some significant changes in the manner in which business is conducted. This research report is dedicated to the changes that information technologies are having on the business landscape in the energy industry. The level of change within IT is accelerating at an unprecedented rate. More fundamental change is around the corner which involves a handful of technologies that will be revolutionary to those that embrace them.

    The oil and gas industry has the opportunity to benefit from the prospective changes. And I would suggest the way these IT changes impact oil and gas maybe the most dramatic to date. The 4 major components of the Genesys technical vision are of significant simplicity, are currently being implemented globally, and are only waiting for a final integration to occur. Many technologies need to be learned first hand before they are understood. These technologies share what I suspect may be the largest impact by building and leveraging onto the comprehensive architecture of the technological environment that exists today.

    The four components are as follows:

    1. IPv6.
    2. Object Oriented Programming (OOP) with particular emphasis and focus on Java.
    3. Asynchronous Process management.
    4. WiMax.

    IPv6 Internet Protocol Version 6

    IPv6 is a key and enabling component of the four elements of the vision. IPv6 will replace IPv4, which is in use today. The key difference is that IPv4 is 2 to the power of 32 vs. IPv6 being 2 to the power of 128. IPv4 provides 4.3 billion unique addresses; IPv6 provides 3.4 trillion, trillion, trillion, trillion (340 undecillion) unique addresses.

    IPv6 will enable anything of importance or value to be monitored and controlled, anything and everything. The ability to have unlimited static IP addressing eliminates the client / server model of computing. In oil and gas, I foresee a variety of devices that will be installed at production facilities to monitor and control activities at the finest levels of detail. Considering the oil and gas industry is primarily chemically driven, heat and pressure are two aspects of what engineers and earth scientists concern themselves with. In other words application of IPv6 opens up the entire spectrum of the sciences for exploitation.

    Currently Korea and China have implemented IPv6 as their network infrastructure. Most cellular phones use IPv6 addressing. Computers from Apple and Sun have been IPv6 capable for many years. It is therefore only a matter of time before the world can and will switch.

    In Formula One the cars have 1,000's of sensors actively collecting data at all times. This data was then able to make modifications to the vehicle while racing. Although the ability to change settings was eventually banned during racing, the information collected was able to eliminate most engine failures. Engineers that have data and control can begin to solve larger and more complex problems with greater insight.

    The ability to function in this environment is going to require some unique technological skills on behalf of the average users. The point I want to make is that the tidal wave of information is going to saturate workers, exponentially more so than today. Therefore each user needs to better understand the information technologies and how best to manage them. The challenge for users is to realize the unlimited application of their imaginations. These technologies are quickly providing firms with the ability to monitor and control their assets and resources. Nothing that we currently experience in today’s client server model comes close to the impact of this technology.

    In many ways the roll out of IPv6 networks is the culmination of all the Internet technologies to date. It is the culmination of what networks were designed to do from the beginning.

    IPv6 can be implemented today. In "Command Information," a web site that is designed to "leverage the change" to IPv6, the use of the protocol is now available in North America. This is significant news to this research’s development in that there is now no technology, of the Genesys technical vision, that is not available today. The market for technology is moving so fast that these software developments are now possible with today's commercial technologies.

    According to this website (downloading the two .pdf's is very valuable) President George W. Bush in his state of the union address on January 26, 2006 launched the American Competitiveness Initiative. Within this initiative it was noted that the majority of the east Asian countries have already implemented IPv6 in their network backbones. For America to compete it will require the rapid implementation of IPv6 in their networks.

    This paper emphasizes that American organizations must adopt IPv6 today. The paper describes what value IPv6 provides as:

    • Accommodating more devices.
    • Faster speeds.
    • Greater mobility.
    • Enhanced connectivity.
    • Integrated security.
    • Enforceable privacy.
    • Easier management.

    The .pdf's files also provide an understanding of the key impact areas such as:

    • Mobility. Maintaining constant fixed point (static IP address) no matter where you are or move to.
    • Security from better architecture and limited ability for viruses.
    • Real time / peer to peer, or as I call it "the elimination of the client server model".
    • Providing a faster broadband with less cost by removing the need for NAT boxes. (Network Address Translation).

    IPv6 is available in operating systems from Apple, Microsoft, CISCO, HP and Sun. Your ISP will be linking to root servers this summer. The good news is that the entire IPv6 infrastructure is available today. Genesys only needs to purchase Internet service from a tier 1 telecom provider in order to begin developments and operational use of IPv6 within its software developments for oil and gas.

    The author of this .pdf, Tom Patterson, refers to a recent government report that states the move to IPv6 will cost $1 billion per year for the next 25 years. The returns will be over $10 billion / year in savings. The costs are mostly borne by software developers, such as Genesys, in reprogramming to use the enhanced feature and capabilities.

    Is IPv6 big? Bill Gates thinks so. He is quoted in the article that "Enterprise Applications will be the "Killer Application" that makes IPv6 necessary."

    Object Oriented Programming (OOP) and particularly Java.

    Java is the second component of the Genesys technical vision. I would encourage most people to begin learning to understand the concepts in the Java programming language. The ability to function in the work environment may require a strong understanding of the underlying concepts and technologies. Just as Microsoft Office is mandatory today, Java may become mandatory in the near future.

    As I indicated previously essentially what the technical vision points to is the elimination of the client server model Which is the standard model that is the foundation of the Internet today. With IPv6 replacing client server, the ability to manage and control any and all electronic devices becomes possible. So what this element of the Genesys technical vision, Java, provides is a "programming language" to deal with this new prospective world. And when we think of Java it is best to frame it in the context of a "programming environment".

    Several of the critical components of Java are well known. The ability to write once and deploy anywhere is largely in place. What may not be fully appreciated is Java's strict typing, polymorphism, inheritance and object implementation. Simply Google “Dick Baldwin's online tutorials” on how these components can be used to make such a difference. I highly recommend reviewing his site. Dick Baldwin operates one of the better websites providing quality Java development education.

    At this point in time the introduction of these four elements of Java are all that need to be introduced. What I want to achieve in this summary is to bring together why Java, wireless, IPv6 and Asynchronous Process Management are so very important in the very near future.

    Imagine a world where everything electronic is reporting, being monitored and controlled, in a wireless environment. Imagine how things don't need to get confused as to which device is which. Sudden system failure due to unseen events is a common theme in Hollywood and systems in general. This problem is what Java sets out to solve by requiring the typing of language so precisely. I see Java as providing the ability to make an environment where any and all devices are operating, and predictable. There is no area for ambiguity in many of these systems. How do you know you used the correct encryption algorithm to decode the production volume, from the right well? Java typing can differentiate anything and everything and that is why it is included in this technical vision. No other language is as strict in its interpretation of typing as Java.

    Lastly I will note the value of inheritance in Java. Inheritance is the ability to build off many other excellent frameworks and works of others. An excellent example of this is the GlassFish server Genesys is using as its base, or Java Enterprise Server (v. 5.0). Testing and development was done from many different perspectives, and although it has little to do with oil and gas or accounting, it covers off many of the basic services that must be provided first. Once we write to a specification and achieve certification, then the evolution of the application will be managed with fewer glitches.

    Wireless Internet connections through Wifi and WiMax

    The third element of the Genesys technical vision is the wireless connectivity that is available today. The simple loss of wiring has a liberating effect on the entire information technology architecture. The ability to broadcast and receive a signal to the Internet at anytime and anywhere has a liberating capability. If we think back it wasn't too long ago that we just started using the Internet on an "always on" basis. What this technical vision attempts to point out is the ability for communication between devices that are statically addressed, mobile and presents a fundamentally new paradigm to the business environment.

    Wireless is a fairly straightforward technology that exists today. A broader scope of reception (WiMax) will bring wireless into being more of a common and necessary tool for the people who work in oil and gas. It is my assumption here that wireless will enable working from anywhere at anytime. This will increase the time requirements of the average worker in oil and gas to 24 hours of being on call. Some of the personal benefits include reducing the demands for time and fuel by the average commuter who only needs to go to the office occasionally. This enables the employee to more effectively manage their day to meet their needs.

    The primary advantage, however, of having an always-on work environment is the ability to do the work when the individual can. Although the user will be available 24 hours a day, the "other" activities in their life can take priority in terms of being addressed. Work is more a natural outflow of the day-to-day activities. The work being predominately asynchronous in nature enables the individual to address the issue after careful thought and interaction based on the user's time and availability.

    These comments reflect on the "how" this system will operate in a wireless environment. The "what" that the user accesses wirelessly is all manner of reports, accounting information, journal entries, ledgers and financial statements. These reports are prepared for the monthly accounting of the joint operating committees to which the employees are affiliated. The overall scope of information would also include the engineering and geological data that the producer’s staff would need.

    A method to deal with the tidal wave of information is needed today. The four cornerstones of the technical vision provide an understanding of “what” and “how” these issues can be addressed today.

    Asynchronous Process Management, or how the real world works.

    Asynchronous vs. Synchronous communications can best be reflected in the differences between a letter vs. a telephone conversation. Synchronous communications and activities have an unpredictable nature to them. They are able to accommodate the unpredictability of the situation by both parties being there to rectify issues as they happen.

    Asynchronous communications and actions have the tendency of not being predictable due to the nature of things never going like they should, or that the reply / response isn't necessarily what was expected.

    Here is where the Java language can implement the asynchronous communications and actions with the objects so that they can deal with life's little problems. Asynchronous actions can be replicated in the Java language and over time acquire any and all possible characteristics or behaviors. This is through the developer’s ability to write methods of exception handling and explicitly in an asynchronous manner.

    Looking forward it is fair to assume the volumes of data that an individual will be exposed to on a daily basis will increase relentlessly in volume and importance. The manner of dealing with data overload by safely ignoring it will soon be over. Whether it is because of your competitor, litigation or a failure that is a direct result of "missing" some data, the ability to "miss" data and proceed safely is a luxury that is expiring as we speak.

    In the asynchronous environment, the speed and ability to deal with all the processes of one individual will require significant automation. Automation that is necessary in order to fulfill the requirements of employee’s jobs. Those that expect to respond on a one to one basis will have difficulty in co-ordination of the resources necessary to complete their responsibilities. Having employees that were productive generating $4 million per year in revenue will lose their competitive advantages to employees that are capable at $20 - 30 million per year.

    For example, how much time is wasted in preparing for, arranging and attending meetings? In addition to the waste, there is the "lag time". I define the lag time as the period of time that is consumed in order that everyone schedules the something "urgent" meeting for next week. It is the "lag time" that provides the asynchronous worker with their time frame for completion. The ability to discuss things asynchronously is augmented by video to mitigate the time losses and lags. When transactional processing is included as we have discussed, the complexity of the system increases in risk and exposure.

    This technical vision is provided as a means to understand the underlying changes that are available and being implemented.
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    Sunday, August 20, 2006

    Military Command.

    Again more text of the proposal.

    This proposal is dedicated to ensuring that the optimal organizational structure is provided for the oil and gas industry. In the May 2004 Plurality preliminary research report I noted, naively, that by using the joint operating committee the hierarchy would be redundant. Naïve - in that the organization begs for a replacement to the traditional command and control structure. It is recommended in this final research report that a military command type or style of structure is necessary to replace the hierarchy.

    One critical area that was not discussed in the preliminary research report was how organizational command and control is achieved. This is a particularly important framework, and one that touches on each of the five other frameworks namely legal, financial, operational decision making, cultural and accountability that were noted in the preliminary report.

    Without the hierarchy to define who is responsible, accountable and authorized, little if anything will or can be achieved. Individuals are how organizations achieve their tasks. The question of who represents the organization, their validity, security and authorization can all be encapsulated in the software. But how do the people organize themselves?

    Military styled command and control is the alternate method proposed in this final research report. By layering a matrix of military structure over the joint operating committee, the how and who that is sourced, tasked and monitored is achieved.

    Military Command vs. Project Management.

    Project management fares poorly in comparison to the global scope of accomplishment of military command and control. This military analogy and metaphor needs to be implemented within oil and gas in order to facilitate a method and a means of getting things accomplished. Since, as we have discussed, software defines the organizational constructs, this command styled implementation is an element of this Genesys system, and specifically the technology will be built to superimpose the military command and control framework on to the joint operating committee structure.

    Project management is limited in its application as a means of operating a going concern. Project management violates its basic premise, which is that it is temporary. We are discussing the viable going concern of a joint operating committee. Other problems in attempting to retrofit a project management structure to manage oil and gas assets include the diversity, depth and scope of communications.

    The implementation here is not dissimilar to the military metaphor, with "orders" being simply replaced in the "work order" system within Genesys. All tasks, equipment, human and other resources are to be managed through the system to provide a means to assert command and control ensuring tasks are accomplished and objectives are attained. This system will also be built to provide the encryption, authentication and authority of each transaction. Since we are talking about the commercial elements of an oil and gas concern then "role" and "rank" of the human resources also need to be implemented to provide a seamless manner ensuring work will be accomplished.

    Project Management teams do not have the diversity of resources necessary to effectively manage assets. Consider for a moment how many people it takes to drill a well. I am talking about the billing clerk at the water trucking company to the chairman of the joint operating committee. Project management cannot facilitate the scope and diversity of the 100's and possibly thousands of people that are involved in getting tasks completed.

    Another area where Project management is deficient is in its depth of resources. In oil and gas it is generally considered, as it is with anything complex, that the quality of the well drilled will be as good as the least experienced individual on the platform. Mistakes happen and the reduction of mistakes takes on a greater role than risk management. The active participation of several producers’ representatives in activities can broaden the scope of the problem solving capability. It is my belief that the more eyeballs that reviews a situation the better. The virtual environment can marshal more resources in this fashion than the physical world can.

    The last deficiency of project management that I will point out is that it is generally limited to human resources. I have noted and discussed the types of communication being asynchronous and synchronous. We have also discussed the four methods of those communications being person to person, person to process, process to person and process-to-process. We cannot limit the scope of the organizational construct of the joint operating committee to just human resources. The physical assets and capabilities of vendors, suppliers, or anyone and anything involved in oil and gas must be managed with the utmost efficiency. If we preclude certain resources at this point then we preclude the holistic solution this system will be. And if we preclude the methods and modes of communication (asynchronous vs. synchronous and Person to person etc.) then we will certainly have limited the potential for this new way of working.

    Military command as a metaphor.

    In using the military command metaphor “Allies = other producers”, or members of the joint operating committee, or service based organizations. Each army can be parsed into further classifications such as Navy, Marine, Army and Air Force. Each participant in the joint operating committee may have several roles, several tasks and several "superiors" and / or underlings reporting to them from various organizations. Many military commands expand beyond the scope of the current army. In WWII the entire allied forces were under the command of General Eisenhower. The English and Canadian militaries, although separate from the Americans, were engaged in similar exercises and were coordinated as one. This is the type of application that I think is needed to solve the current and prospective energy issues. While working for a company you may be seconded to work for several different joint operating committees that your company has an interest in. This military analogy is only a more formal method of recognizing the loosely coupled nature of the missions, tasks, physical resources, and personnel.

    Secondly separate tasks or specialty roles are segregated between certain military disciplines. In this analogy the Navy, Air force, Marines and Army are replaced by the Geological, Engineering, Administrative and Field disciplines. As with the individual disciplines the military chain of command remains in tact through the various disciplines. As an Army Captain would have superior rank to a Navy Private, the Senior Geologist would also have a recognized authority and superior rank over a junior Engineer.

    Each worker within the oil and gas industry is therefore tasked in many different situations with different ranks and roles. The producer that is his / her employer will have the opportunity and latitude to second each individual to work in any capacity and area that they are authorized in. Each worker in turn may have several different producers, which is almost a given, to be assigned tasks from.

    The analogy to the military has unfortunate connotations. However, it is by far the best manner of layering a component of command and control over the joint operating committee. The systems that we develop here are best suited for these interactions. So much of what we discussed here would be transparent and seamless to the user.
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    Who would Henry Ford hire?

    As copy is returned from my editor I will publish it here first. I would expect that the remaining entries for the rest of August will consist of edited copy that will form the proposal in September.

    One topic of discussion is the effect that information technology and innovation have on the various roles of society, organizations and people. According to Dr. Anthony Giddens Structuration theory, society, organizations and people all move in lock step with one another. Any distortion in the progress of one over the others will lead to a failure. Dr. Wanda Orlikowski further advanced this theory with her application of Structuration to information technologies whereby she noted that technology was an element of society.

    The progress of society, based on the influence of information technologies, will be faster than organizations or people. However, I think the progress of society, as dictated by the various technologies will not exceed the speed at which the people can accept it. The critical motivating force in people accepting technology will be the demands of their employer. The hours worked and the productivity of "some" countries is creating pressure on people to respond and thus require technology to keep pace. This leaves the organization as the odd man out in the troika that Giddens and Orlikowski have defined.

    This research report is dedicated to innovation and the application of technology in support of the oil and gas industry standard Joint Operating Committee. Today organizations such as Harvard University and McKinsey Consulting have joined the debate regarding organizational structure. They state that collaborative tools are available to eliminate the hierarchy, (my interpretation of their words) and that these technologies need to be used in order to sustain any competitive advantage large organizations have, which is the final evidence needed to prove this application of Giddens theory of Structuration.

    With this preamble regarding Structuration, I want to ask, what effect did Henry Ford have on society, organizations and people? Clearly the type of worker that Ford employed after the invention of the assembly line was fundamentally different than what he needed before. The role of the organization was changed with such explicit and radical thinking as paying his workers better wages, which increased the number of people that were capable of purchasing a car.

    The optimization of work around the assembly line took the better part of the last century to unfold. A century to develop information technology related innovations would seem like a luxury today as the pace of change accelerates and a century of innovations are likely to be compressed into what I suspect would be a decade.

    What kind of worker is needed in this networked, virtual world of information technology and innovation? Ideas are not 9 to 5. Just as Ford today is challenged by its competitors’ more effective use of the assembly line, and is in jeopardy of facing its own demise, what roles need to change, and how will people act and react?

    Therefore it is reasonable to ask whom would Henry Ford hire today, and what would these people do?
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    Tuesday, August 15, 2006

    The SEC is building its system.

    The SEC has now released an RFP (Request for Proposal) for the system that I discussed here. A copy of the press release can be seen by clicking on the title of this entry. If the old SEC can change it's stripes, maybe, just maybe the oil and gas industry can move forward as well. We'll find out in September when the proposal is delivered.

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    Tuesday, August 08, 2006

    The plan

    With the 200+ entries into this blog, I see that a theme has developed. Two articles that I read last week were the trigger to realizing this theme, and now a plan has emerged. Senator John McCain in Fast Company wrote on the subject of courage. Stanford Economist Paul Romer writing on the topic of economic growth. It is clear to me now, the time in which the oil and gas industry builds these systems is now.

    In the next month I will be writing a new proposal that incorporates the plurality document as its appendix. This new proposal will take a number of themes that I have written in the past six months, relate them all and publish them for distribution to the industry to consider and act upon.

    This proposal will of course focus on the joint operating committee as the central organizational focus of the software. This is a theory that deserves to be fully tested through its adoption by industry. It is an idea that provides a sound foundation for the effective management of oil and gas assets. An idea that is based on facilitating the earth science and engineering disciplines greater innovativeness. An idea that can augment a producers capability and speed in this difficult time for oil and gas.

    I will also be including the four cornerstones of the technical vision. How the impact of these technologies will affect the oil and gas market. IPv6 enabling the elimination of client - server and replacing it with static IP addresses for everything including your toothbrush. What I believe the engineers and geologists can and will do with this level of static addressing is unlimited. The incremental nature of typed, object oriented programming languages like Java, our chosen language. Java enabling the exception handling capabilities and asynchronous process management that is critical to handling the intra-partner interactions. And finally, Wifi enabling everything to be connected at low costs and high speed. These four technologies will be revolutionary in the oil and gas industry when layered over the joint operating committee as the organizational focus.

    With this technical vision layered over the joint operating committee, I will then go on to discuss this blogs entries regarding "Partnership Accounting". How an algorithm can capture the unique and demanding accounting and reporting needs of the producers as represented in the joint operating committee.

    I will then note the military command structure as a replacement to the regular hierarchy. It is probably foolhardy to eliminate the hierarchy and to loose some of the attributes of a control structure. In this blog I have discussed the military command type of structure to augment the managements control apparatus. This also allows the human resources to be deployed in a greater diversity of situations, and have their tasks outlined and issued from a variety of producers as their employers. This military command structure will draw a parallel to the interactions of various military groups interacting under NATO.

    I will then want to highlight the historical perception of linear thinking and contrast it to the logarithmic and exponential futures. Stanford University Economist Paul Romer has captured what the future economical progress can be. In a world of limited resources it need not be a zero sum gain. That the use of ideas have potentially logarithmic or exponential value creating capabilities.

    In addition to all of these topics of discussion I will reiterate the Genesys value proposition. A value proposition that is not dissimilar to Google's. Where the costs of development are allocated over a larger base of users. Where each user is able to benefit from the purchasing power and capabilities of the entire population of users. This is the nature of software and the value of its proposition is something that I don't believe has been fully implemented or realized by the producers.

    I also want to ask one of my favorite questions of the people within the oil and gas industry. That question is, who would Henry Ford hire? A question that is just as pertinent today as it was 100 years ago. Just as Ford needed a new "type" of worker, so will the prospective oil and gas producer. What type of employee will the producers need in this dynamic networked environment. What type of skills and capabilities should the oil and gas worker obtain to be optimally deployed in the future oil and gas industry?

    Today's news that BP has shut in their Alaskan production due to pipeline leaks is evidence of the tight balance between supply and demand. The market demands for energy can not sustain too many large fields being shut in. Companies are already being questioned by the cynics and those that can least afford the higher prices.

    Last if not least this proposal will note the 12 + calls to action. Oxford, Harvard, MIT, Energy Secretary Bodman, McKinsey Consulting, SEC Chairman Christopher Cox, Sir John Browne of BP, John Hagel III and John Seely Brown and others. These have become predictable in their message and their frequency. Many noting the time to act is now. And that will be the proposal's message to industry.

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    Thursday, August 03, 2006

    The future...

    I've come up with some new thinking that was more or less prompted by two articles I read today. These articles have put the final parts of the foundation and context of where I stand personally on this software development project. As may have been noted in my previous entries the fight with the industry is over to a large extent. I am willing to let what has happened pass into history with no remorse on my behalf. It may very well be time to move on and as such, this blog has served its purpose in securing and publicizing my intellectual property.

    The first article "In Search of Courage" is from Fast Company and was written in 2004 by Senator John McCain. The second set of articles were written by Stanford Economist Paul Romer entitled "Economic Growth" and I'll start here and then move to the McCain article with a summary at the end.

    When I was thinking as much as I could about the competitive nature of the software industry, I kept thinking what an enduring competitive advantage might be in such a fast moving business. It seemed that by the time you have adapted to the new requirements, more fundamental changes were necessary to be implemented. A never ending chasing your tail type of scenario. The only sustainable competitive advantage that I could determine was intellectual property. It was therefore in this area that I set out to establish my competitive advantage. And it is there that I was able to create the plurality document that establishes the copyright for these developments.

    What I didn't know at the time was that ideas had consequences. The consequences of this particular idea was the repeated slamming of doors of opportunity in the oil and gas industry. Naively I believed that many of the industry leaders would see the value behind using the joint operating committee as the organizational focus and we could rally the troops around the development of the software. Since I had wrote the research I earned the copyright and the rest was history. Little was I aware of how the entire document would be perceived as a threat from the management of the industry. I know now what the consequences of good ideas are, as I have lived them for the last 30 months. I also now know that it was not personal, it was and should have been the expected reaction to such a forceful idea.

    Paul Romer is an economist at Stanford University and is cited as having a significant influence in the study of economics from the point of view of growth and value. He concluded in the mid 1980's that the real value in the future was intellectual property (IP). Noting that IP was capable of multiplying the economies output and growth. That this multiplication had long term effects of making significant growth impacts on all economies. That ideas have consequences and those consequences were exponential growth capabilities.

    Anyone with a limited working knowledge of oil and gas knows that the joint operating committee as the organizational focus is exponentially better then the hierarchies. Most if not all the problems in oil and gas melt away from the perspective of using this organizational focus and software tools of today. For the industry to achieve "Compound Rates of Growth" as Romer suggests will only be based on intellectual property.

    Now a funny thing happened on the way to the researching of this theory. I published my proposal to industry in September 2003 on the basis that if they financed the research they would earn the copyright. Unfortunately for them they laughed at the prospect of a local company doing research and the door slamming started its now familiar tone. Since I did the research, I earned the copyright and now that is mine to do with as I please. Believing that the industry would be wise to the plurality document I continued on, by myself at great cost and personal sacrifice. The last thirty months would have been hard for anyone, but particularly for someone my age. This is where Senator McCain comes in with his article on courage.

    Firstly I highly recommend that everyone read, print and keep a copy handy for what may be an economically rough ride for all in the next few years. I want to list the really pertinent points of the article and then conclude this posting.

    "Courage is like a muscle. The more we exercise it, the stronger it gets."

    "That means trouble for us all, because courage is the enforcing virtue, the one that makes possible all the other virtues common to exceptional leaders: honesty, integrity, confidence, compassion, and humility. In short, leaders who lack courage aren't leaders."

    "The same holds true for the business world. Corporate America has taken significant blows to its reputation, because too many executives don't have the courage to stand up for what they know is right. The perception among many is that corporate leaders are committed only to their own self-enrichment. "

    "Very few of us are called upon to test our courage in the crucible of fear and hard moral choices. And yet courage still matters -- more than we think."

    "Winston Churchill called courage "the first of human qualities... Because it guarantees all the others." That's what we mean by the courage of our convictions. If we lack the courage to hold on to our beliefs in the moment of their testing, not just when they accord with those of others but also when they go against threatening opposition, then they're superficial, vain things that add nothing to our self respect or our society's respect for the virtues we profess. We can admire virtue and abhor corruption sincerely, but without courage we are corruptible."

    "As courage demands great sacrifice so does it demand great economy in its definition. General William Tecumseh Sherman defined courage as a "perfect sensibility of the measure of danger and a mental willingness to endure it."

    "Courage is the highest quality of life attainable by human beings. Its the moment however brief or singular -- when we are our complete, best self, when we know with an almost metaphysical certainty that we are right."

    "You must be afraid to have courage. By fear, I mean the kind that entails serious harm to ourselves, physical or otherwise, the kind that wars with our need to take action but which we overcome because we value something or someone more than our own well being. Courage is not the absence of fear, but the capacity to act despite our fears. You can live with pain. You can live with embarrassment. Remorse is an awful companion."
    I have lived with the consequences of my ideas. I have sacrificed everything that I have in the support of this software project. Believing fundamentally in the need for this to be done, to be done in a manner that did not consider my needs. I am a small issue in comparison to the issues of the oil and gas business and the community of its users.

    So the point of this posting is... Simple, the time has come to call an end to the sacrifice and effort on my behalf. I have not stood on this intellectual property and become a troll just waiting to pounce. I have been active and pushing this theory and opportunity as hard as I could for the past thirty months and the time to call an end is complete. With 12 to 13 calls to action, all sounding the same call I noted in May 2004 the industries time to display the necessary courage is now. As I said mine is complete.

    I think when everything that you can think to do has been done. When the personal sacrifice is complete and their is nothing to prove, particularly to myself, I know I am not the source of the problems. In the next few months I will be preparing a revised proposal looking for a few courageous oil and gas firms. Firms that can see and read the writing on the wall with respect to the long term prospects of the hierarchy, and have the moral courage to act. For it is time for action.

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    Wednesday, August 02, 2006

    July Business Report.


    A change in our marketing approach. The more I think of it the more the old one seems to have been conceived in a nightmare. The number one objective in the next 3 months will be to find a project sponsor. The more I read the book we are reviewing "Don't Park Your Brain Outside" the clearer it is that the failing in making this project "real" is due to this blogs author. Instead of thinking that I am outside where my brain has been parked, our marketing will bring us back inside.

    More on the marketing activities in this next month. Time for reflection and planning for the next 31 days.


    The pace that I had set out last month has slowed due I think to the summer months. The heat and the successful nature of the oil and gas industry seem to have permitted a few more relaxing hours then in the past. During September we will re-establish our objective of putting the 8 posts per week back into play.

    This also seems to have had an effect on our technorati ranking. Sliding backwards a bit is reflective of the summer doldrums.

    Technical Architecture

    No changes to the overall technical architecture were made in July 2006. I will be reviewing the architecture in the month of August in line with and for the sponsor marketing search.


    Revenue to the end of July: $0.00

    Consistent with the marketing program changes I will be re-costing and reviewing the objectives for the sponsorship program. These will be comprehensive in nature and will involve the entire reconfiguration of the budget and goals that are to be set out.

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    Tuesday, August 01, 2006

    Petro Canada Q2 Earnings.

    Petro Canada have published their second quarter earnings report and I have to admit that I was wrong in terms of the position I was taking on this blog. My inability to convince the industry of the needs of this type of solution had lead me to being convinced that conflict was a means to the end. In retrospect my frustration got the better part of discretion and I pursued the theme to the extreme. There is nothing more to do than to apologize to Petro Canada in the same manner the analysis was raised. I trust they will forgive me.

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