Power of Information
How Data Collection Improves Efficiency and the Bottom Line
Follow the money.
The 1976 film about the Watergate scandal, All the President’s Men, made that phrase famous, implying that if you want to know the truth, you had to follow where the money came from and where it went. That same kind of thinking is helpful in business too. To keep track of your money, you have to follow the data.
In the post-recession world we live in, getting the most from every dime goes a long way to ensuring a healthy bottom line. Pipeline owners and contractors have a laundry list of how they spend their money on projects day-to-day, including but not limited to personnel, equipment, fuel and third-party services. If a company is going to accurately track spending, it needs a tool to collect and analyze that information. That’s where enterprise software comes into play.
Enterprise software providers such as Dexter + Chaney, VistaVu Solutions, HCSS Inc. and others offer sophisticated tools for collecting data, analyzing spending and managing overall operations. These software solutions streamline the collection of field data and synthesize the information for use in such applications as payroll, billing, job costing and benchmarking. These data collection tools give companies a real-time snapshot of costs and revenues — that is, as long as they can track this information in the field.
The prevalence of Internet connectivity and adoption of mobile devices, such as tablet computers and smartphones, has driven the demand for remote access to the data analysis capabilities that enterprise software provides. By allowing field personnel to use mobile technology to log jobsite information and submit reports digitally, companies truly get a real-time view of their projects. Not only does this improve efficiency, it allows companies to analyze expenses immediately, rather than waiting up to a week for paper reports to be filed.
Mobile enterprise software solutions allow field personnel to keep track of a variety of jobsite information, like an up-to-the-minute diary of a project, recording employee timecard information, equipment and material usage, site inspections, downtime, ground conditions, weather, jobsite photos, third-party costs and more.
The software allows the user to track each phase of a project and enter a cost code for the work being done. Companies can track material put in place or delivered to the jobsite, as well as measure productivity compared to how the job was bid. The data collected eventually becomes the bill companies send to their customers and helps companies determine if they have the right number of employees on the job or whether a piece of equipment is earning money.
The cost of implementing this type of data collection and analysis software varies depending on the features, the customer’s current network capabilities and the number of licenses they’ll need for those using the software. Costs can range between a few thousand dollars per license to $25,000 for a pilot program.
The information pipeline contractors and operators are collecting hasn’t changed, but the way they are collecting the data has, says Wayne Newitts, marketing director at Dexter + Chaney, whose primary enterprise software solution is called Spectrum Project Management. The demand for mobile access to enterprise software isn’t driven by any new developments in the industry, but rather by the technology itself.
In the realm of the oil and gas pipeline industry, where field personnel are constantly moving from jobsite to jobsite, the convenience of mobility is a must, says Steve McGough, chief operating officer at HCSS, which offers its HeavyJob to pipeline contractors and service companies. Regardless of whether a user has a laptop, tablet or smartphone, enterprise software platforms need to be independent and flexible.
The use of enterprise software among pipeliners is becoming more widespread as mobile connectivity becomes more common and the ability to connect in the field becomes less of the problem it was 10 years ago, says Dan Parsons, sales engineer at VistaVu, which partners with SAP AG, a German software company, to provide its FieldVu platform for small- to medium-sized oil field service companies involved with well service, rental, light assembly and oilfield construction (including pipelines).
In addition, the younger generation of workers who are more accustomed to using mobile technology have the expectation that they will have the ability to access important information on the go.
On the Move
Constant Internet connectivity has become a way of life and a necessity for doing business. In today’s world, it’s no longer a luxury but an expectation.
“We reached a tipping point two to three years ago when the Internet became ubiquitous to the point now where it’s basically a utility,” Newitts says. “Right now, if you walk into a building and you’re not connected, you think something is wrong.”
As mobile technology has become more widespread on a personal level, companies have started to adopt a “bring your own device” mentality, better known as BYOD. Instead of investing in laptops for field personnel, companies instead help employees with their data plans, so they can use their own devices on the jobsite. Companies like Dexter + Chaney have developed apps for these devices that allow users to access their enterprise software. These apps provide the ability to enter data without a cell or Wi-Fi signal, synching the data to the system when there is connectivity.
However, as important as it is today to have mobile access to the Internet, you’d better have a backup plan, Parsons says. In this industry, it isn’t uncommon for field personnel to be working in an area without Wi-Fi or cell service. He suggests having multiple ways of inputting information, whether a mobile device is online or by using the software’s offline capabilities. As a last resort, paper tickets can still be used and the information keyed into the system back at the office or as soon as Internet can be accessed from the jobsite.
Head in the Clouds
The exponential growth of Internet connectivity has become such that society now can’t live without it, Newitts says. In the last three years, the advent of tablet computing and smartphone technology has led to personal computers accounting for just 50 percent of all computing, when in the past it was 95 percent. Mobile technology is taking over, and cloud-based computing is the order of the day.
“More and more that’s what has happened,” he says. “Software is moving to the cloud, where all the hardware that performs the powerful computing is accessed remotely. You don’t need powerful processing capability and large data storage in the device you are using in order to benefit from both. Right now, I can stream a terabyte-sized construction plan to my tablet, a device with significantly less processing power and memory than my desktop computer. If you aren’t taking advantage of this kind of computing today, you’ll soon be falling behind your competitors.”
The benefit of cloud-based enterprise software solutions is the significant cost savings, McGough says. It also eases the burden on companies’ IT personnel.
“The big benefit with offering services through the cloud is an up-and-coming company is not forced to have a big capital expenditure to put in servers and a server room,” he says. “They have the ability to expand and contract quickly.”
However, it’s not just smaller companies that are drawn to cloud-based solutions, McGough adds.
“When we first started offering services through the cloud, we thought it would be the smaller companies who mostly took advantage of it, but it turned out to be the opposite,” he says. “In a lot of cases, it took the headache off IT personnel from larger firms, who could then concentrate on business matters.”
In addition, disaster recovery is another area of concern solved by cloud computing, McGough says. Having mission critical software in the cloud can have a big impact if personnel must leave the building and work remotely.
Cloud-based computing, however, has become a bit of a buzz word in the business world, Newitts warns, suggesting software providers need to “do it right or don’t bother.”
“Everyone right now wants to lay claim and say they’re in the cloud,” he says. “Companies are saying they offer cloud-based software, but the problem is some customers are getting software that is not truly cloud-based. Instead, it really just provides remote access, for which you typically need specific hardware and special software to access. The costs start to add up. You should be looking for real, true cloud-based software, where all you need is a browser and an Internet connection. That’s when the costs start going down.”
Using mobile enterprise software helps pipeline contractors capture costs as quickly as possible without losing data, Parsons says. Having accurate and complete data goes a long way to maintaining a strong bottom line.
“Revenue minus costs equals your bottom line,” he says. “Contractors use data collection to accurately measure costs, and those costs are primarily labor, use of equipment and material. A good way to improve the bottom line is to manage those three elements. When you do that, you’ll have a good picture of your costs.”
Tracking costs also helps contractors define the scope of a job, Parsons says. The companies can divide the pipeline project into logical segments, such as surveying, excavation, laying in pipe and covering up. The software assists in job costing, so companies know how to allocate their spending and resources for each segment of the project, and how to bill those segments to their customers.
In today’s business climates, McGough says companies would have a difficult time surviving if they didn’t track this data.
“With margins being squeezed, companies need to know where they stand on their jobs,” he explains. “If you bid a job that’s tight, and you know it’s going to be tight, if something goes wrong at a certain point, you can’t afford to keep working on that section while losing money.”
There’s no room for error, McGough says. The information collected provides transparency to the data, allowing everyone in the company to be on the same page.
This type of software helps keep projects on schedule, Newitts adds. Contractors know where they stand day to day, not two weeks out.
“At the end of the day, they can look and see I’m over budget 5 percent. Why is that? Is that due to labor, waiting for equipment to be fixed, materials not being on location, being idle? They can get to the root cause of why they’re not profitable,” he says. “If you don’t have the data, you won’t have that capability.”
Collecting and analyzing field data allows contractors to benchmark their operations and help determine how they could improve operations, Newitts says. In order to improve, they have to know where they stand currently. By collecting benchmarking data and using software to analyze that data, companies can figure out where their opportunities are for improvement.
“That’s what enterprise applications do,” he says, “they take the field data and spit out an answer.”
Bradley Kramer is managing editor of North American Oil & Gas Pipelines. Contact him at bkramer@
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