Real-Time Business Becomes a Reality: Pacific Drilling’s Journey to Doubling Revenue
One of the most compelling business cases I’ve seen for the power of real-time information comes from a company few of us have probably ever heard of—yet. Pacific Drilling is a Houston, Texas-based offshore drilling contractor. They specialize in the field of ultra-deep water drilling for the oil and gas industry using high-tech vessels capable of drilling 12,000 feet to the ocean floor.
The company invested in its IT backbone right alongside its physical infrastructure, implementing the SAP Business Suite to manage key business processes the same year it began building its first drillship. But because of database performance limitations, reporting was mainly done via spreadsheet which required significant rework and manipulation of stale data.
That may have worked for a time, but the company was—and continues to be—in high-growth mode. Five years ago, Pacific Drilling had 12 employees. Today it has 1,200. Over the next five years, the company aims to double its size yet again–—along with its $638 million in revenues to more than $1 billion. Last year, the CEO challenged IT to create an executive dashboard for real-time performance management. In addition, company leaders wanted to evolve from batch to real-time processes and take advantage of timely, self-service analytics.
This summer, Pacific Drilling migrated their SAP Business Suite to SAP HANA in just 60 days after the initial proof of concept—without any disruption to the business. By running transactions and analytics in the same environment, we saw IT deliver that executive dashboard providing up-to-the-minute access to all critical data from expense and revenue forecasting to rig uptime. All employees– from finance and HR to maintenance and supply chain, from those sitting at headquarters to those who work in the middle of the ocean—are benefitting from real-time insight. They not only see the same data 24/7, but can interact with live transactional information. The company has already seen 50 percent performance improvement in its payroll and MRP processes.
It was time, Vice President of IT Coy Wright explained to us, to evolve from reactive to proactive management. SAP Business Suite on HANA now serves as an innovation platform for real-time apps, business processes, and models.
You can see how the power of a predictive engine could revolutionize maintenance, for example. It takes a minimum of four months to get a spare part to the company’s vessel sitting off the coast of Nigeria. And the ship needs lots of parts to remain up and running. IT folks at Pacific Drilling are exploring ways to collect and analyze machine data from sensors on its equipment—like power generators—on the fly. Using the predictive engine within SAP HANA, vessel managers will be better able to forecast parts demand. The ultimate goal: real-time monitoring and analysis that will prevent problems before they happen. SAP HANA will enable the company to advance many of its processes in ways no one would have thought of before, Wright told us.
From an IT perspective, the migration has created a simpler—and much less costly—IT landscape with a single platform for analytics and transactions and reduced database size. The fact that SAP HANA leverages SQL was a big plus as such skills are readily available in the company. What’s more, the new platform is scalable so there will be no need to buy new hardware as Pacific Drilling pursues its rapid yet structured growth strategy.