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Computer-Aided Lean Management

by Roger Anderson, Albert Boulanger, John Johnson, and Arthur Kressner
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PETRO.pennnet.com//blogs/[email protected]

July 25th, 2010
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July 25, 2010

By Roger Anderson, Columbia University

Lots has changed in the energy world since my last blog on this site.  Our Con Edison/Boeing/Columbia team won the largest Smart Grid stimulus award in the country at the end of November, 2009.  Our mission is to demonstrate the improved performance capable from adding Computer-Aided Lean Management (CALM), and the computational intelligence that CALM signifies, to the electric grid of a large urban city, New York.  After jumping through many, many Integrated Management Plan hoops that were right out of our book, we finally started work on June 1, 2010.  Summers are the highest stress times on the NYC electric grid, and we are collecting useful data on how the Smart Grid will in the future help urban utilities.

And then there was the BP blowout in the Gulf of Mexico.  I have been busy trying to add as much scientific and engineering “correctness”  as I could to coverage of the many news media outlets.  So far, I have been on the radio at AP, BBC, NPR, CBS, and in print at Scientific American, Washington and Denver Posts, AP, Reuters, Christian Science Monitor, and too many others to remember. Living in NYC, I try to stay off the TV so that no one will know what I actually look like.

Review my previous posts below, and you will see that they were prescient about the need for CALM in the deep-water oil world.  To prove the point, Tony Hayward, CEO of BP, resigned today after many contortions caused by BP’s lack of preparation for the possibility of such a “Black Swan” event.  Black Swans are the far end of the likeliness distribution, and so they surprise even the largest of corporations (and countries — think 911 and the U.S.) — when they happen.  On the one hand, foreseeing the worst has never been a strong human trait, but on the other, we worked directly with BP in the late 1990’s to convince them that they needed CALM methodologies to confront the real options of both success and failure in the deep-water, specific to the Gulf of Mexico (GOM).  We even brought in Boeing way back then, and I spent 3 years at Boeing’s Clear Lake, TX, offices (think NASA) trying to put together a project that would have delivered CALM and it’s requisite Systems Integration expertise  to BP.  We discussed using CALM at Thunder Horse, and the two other giant oil fields in the GOM deep-water that they had  discovered back then (Atlantis and Holstein).  BP rightfully thought Boeing alone was too great a risk because they had no oil field experience, so we added Kellogg, Brown and Root (KBR) to the team.  We were never able to convince BP that the benefits matched the costs, mainly because the costs from such a Black Swan event as we are now experiencing, were then beyond the imagination of BP’s Executives and Board of Directors.  To his credit, Tony Hayward was one of our biggest management champions back then.  Also,  such executive decisions are not surprising, and persistence is required.  Boeing is a big company and its skills are in high demand, so their management could not wait for BP to decide.  They withdrew to more familiar turf, as well, and the rest is history, unfortunately.  It is ironic that now I am developing Smart Grid electricity technologies for Con Edison, Boeing and the country, while BP and the entire deep-water  oil industry are reeling (for example, I was on the NPR of Brazil talking about lessons that they can learn from our GOM blowout).

We are experiencing not so much “Peak Oil” (google it) in oil Production, as is being predicted, but likely instead, Peak Oil Consumption — if not in the world, certainly in the U.S. — as the general population finally realizes the tremendous hidden costs of cheap gasoline and diesel (think military as well as civilian costs).

To put my money where my mouth is, our family went out yesterday and bought our first hybrid car — admittedly a Lexus HS rather than a Toyota Prius.  We would have waited for a Chevy VOLT, but my parking garage at Columbia does not yet provide charging outlets for such an all-electric car. I venture that 5 years from now, when our Lexus Hybrid is “obsolete”, Columbia will have many “green garages”, and the world will have had no more deep-water blowouts.  Let’s hope so.


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