Assurx Case Study: Alyeska Pipeline Service Company

a l y e s k a

“CATSWeb allowed us to implement our business processes without redefining them. This resulted in our ability to efficiently accomplish our business goals.” Kathie May Regulatory Affairs Manager Alyeska Pipeline Service Company

c a s e

s t u d y

“We went through a formal functional design phase and detailed every aspect,” Jessee says. “Before we built anything, its functional design had to be fully understood.” Doing it this way also made certain that all parties approved design details before implementation. “Our implementation process worked out pretty well,” Jessee recalls. Development was done on a hosted server at SysGen in Illinois and another was set up at Alyeska for quality control. Handling testing this way saved a lot of time, Jessee says. “Because of AssurX’s ability to immediately provide a hosted site for development, we didn’t have to wait until all the hardware was installed before we could get moving…we could do things in parallel.” Elaborating on the process, he explains, “We were able to keep moving forward even when we didn’t have the final hardware on-site yet…we migrated information in batch mode, completed certain forms, and then tested them. Once everything worked as designed, then we’d deploy, migrate and install.”

Training & Going Live CATSWeb went live in October 2003 within the approved budget and to unanimous user approval, Jessee says – a trend that continues to the present, as he says, “User feedback has been very positive.”

AssurX, Inc. 305 Vineyard Town Ctr. Suite 374 Morgan Hill, CA 95037 Tel 408.778.1376 Fax 408.776.1267 www.assurx.com

But if the deployment phase went smoothly, the training path was even smoother. In fact, an Alyeska employee designed the training system for other employees. “We took the training process and made it into an interactive tool with audio that explains how the process works and what the different roles are,” Jessee says. It takes only about 30 minutes to go through the training.

New Process Impact Asked to describe ways the new process has impacted operations at Alyeska, Jessee notes

© Copyright 2005, AssurX, Inc. All rights reserved.

for starters that management no longer needs to meet each month to go over delinquencies; instead, the system provides an automatic online report published on the first of each month. “Management is happy; they now have their monthly reports from the home page and enjoy major efficiencies.” Another positive impact: those old 5% to 20% delinquency rates are a thing of the past. Since implementation, there has been a grand total of one delinquency over the past 21 months. Alyeska personnel are now able to “hit the deadlines, monitor assignments and better communicate” observes Jessee. Better still, Alyeska has “raised the bar” for its own performance standards. “Performance metrics have been raised to 99% of all MAC actions and commitments in a timely manner, an order of magnitude improvement,” Jessee says. In addition, over 100 changes have been implemented to date as part of the ongoing continuous improvement program at Alyeska.

A Bright Future “We’re finding new ways to use the tool all the time to manage compliance activities,” Jessee says. For starters, he’s already adding more management processes including document change, reliability centered maintenance, change management and lessons learned. Alyeska officials are working with regulators to identify ongoing regulatory obligations that are due on a quarterly or yearly basis. “By doing this, MAC has been able to assign these recurring actions and assure ongoing compliance by documenting the history,” Jessee says. “Thanks to our new program, we’ll now have a complete history of how we’ve complied.” Like many new uses the team at Alyeska continues to discover, the ongoing regulatory obligations weren’t part of the original project. “The new system has grown with us to help in ways we hadn’t even imagined,” he says.

Alyeska Pipeline Service Company

customer case study

Compliance Management:

A Comprehensive Approach to Assuring Management Actions and Commitments

A l y e s k a

P i p e l i n e

Alyeska Pipeline

Compliance Management: A Comprehensive Approach to Assuring Management Actions and Commitments

The consortium of companies that own the Trans-Alaska Pipeline System (TAPS) includes: BP ConocoPhillips ExxonMobil Koch Unocal

One of the longest, most important and most regulated oil pipelines in the world faced a significant challenge: after a comprehensive internal audit of the corrective action process, it was discovered that Alyeska Pipeline Service Company (Alyeska) had more than 60 different methods of identifying problems and correcting them. Officials at Alyeska knew that they needed to streamline their approach to monitoring safety issues, environmental surveillance, maintenance and overall quality efforts to operate the safest and most efficient pipeline system possible. The good news is that Alyeska found a solution. The product selected by Alyeska was CATSWeb by AssurX. To learn more about how Alyeska selected CATSWeb and leveraged it to significantly improve its operations, read on.

The Alyeska team identified four key shortfalls in their process: 1.

2.

3.

4.

Understanding the Challenge After an internal audit of the corrective action process a few years ago, Alyeska’s leadership knew they wanted to improve in some important areas. But when your “office” stretches across more than 800 miles of pipeline, crosses three mountain ranges and 34 major rivers and features the work of 2,000 employees, that’s a pretty tall order. But understanding and addressing challenges is nothing new at Alyeska. Since pipeline startup in 1977, Alyeska has operated with an innovative, positive mindset based on the concept, “As long as there’s oil…we’ll continue to move it.” And move it Alyeska does. The Trans Alaska Pipeline System (TAPS) is an engineering marvel that today moves approximately one million barrels of crude oil per day from Alaska’s North Slope to the Port of Valdez. And don’t forget that TAPS must work closely with more than twenty primary regulatory bodies, including the Department of Transportation, Bureau of Land Management and the U.S. Coast Guard.

their formal business processes should work and then find a tool to adapt to their process – not the other way around. Key to Alyeska’s needs was flexibility, said Mel Jessee, Regulatory Compliance Specialist. “The process always comes first, the tool comes second,” he said. More than crude oil flows through TAPS; there is also a heavy flow of information and regulatory commitments. In 2002, Alyeska set a standard to close 90% of high and medium priority commitments in a timely manner for regulators. In early 2003, the overall monthly delinquency rate ranged between 5% and 20%. Alyeska knew it could do better, and sought a partner to help it reach that goal.

Addressing the Challenge In order to improve their operational efficiency, Alyeska knew that it must first get a clear understanding of its strengths and weaknesses, then invite service providers to show how they could help address those issues, and finally conduct a rigorous evaluation to find the right partner.

It’s a big job to manage. In order to improve their operations, Alyeska wanted to better define how

c a s e

s t u d y

Lack of an intuitive tool, linkages to other processes, and standardized prioritization User difficulty with the current tool has led to the creation of duplicative tracking databases Reporting lacked an easy way for employees to gather data and create adhoc reports because of the difficult user interface; and Lack of linkages with other processes has led to commitments to regulators becoming unfunded during the course of the year, making compliance more difficult.

Alyeska’s overall commitment was to develop a Management Actions and Commitments (MAC) program, that would provide assurance to regulators and the public that environmental, technical and safety related commitments and corrective actions are being effectively managed. “Adequate and appropriate means and procedures for the detection and prompt abatement of any actual or potential condition that is susceptible to abatements… which at any time may cause or threaten to cause a hazard to the safety of workers or to the public health or safety, or harm or damage to the environment.” “We take this commitment seriously,” Jessee stressed. “We wanted to back our strong words with even stronger actions.” To do that, Alyeska used MAC as its corrective action process (CAP). The TAPS compliance model relies on formal business processes to monitor and ensure on-going compliance and conformance. When real or potential deficiencies are discovered, the CAP captures, tracks and helps ensure the resolution of the situation.

Selecting a Solution Jessee and his team knew Alyeska required an excellent system, and they developed a rigorous qualitative selection matrix to help them find it. The software selection matrix focused on important criteria that included: 

   

Risk based on vendor maturity/stability, product maturity/stability and other preliminary costs Process compatibility with defined business requirements User interface and intuitive nature of the product Data compatibility with data fields identified in MAC process Technical compatibility with Alyeska’s IT infrastructure and strategy

“We first looked at developing a custom solution from scratch,” Jessee recalls. But after a look at the high costs, long timeline and other risk issues, Jessee and his team decided instead to search for existing Corrective and Preventive Action (CAPA) systems. They found 13 off-the-shelf offerings that generally matched Alyeska’s requirements. Digging deeper, they knocked ten off the list and focused on the three most likely to be able to meet or exceed TAPS’ demanding requirements. After reviewing the presentations of the three vendors, Jessee and his team asked the top two to provide formal vendor proposals. AssurX’s team worked part-time over a two-week period using a hosted Internet connection to deliver a working prototype within Alyeska’s deadline. “It was simple to tailor the flow and feel of CATSWeb to meet our requirements,” Jessee said.

Implementing the Solution With CATSWeb identified as their choice, the Alyeska team – backed by AssurX support – put together a project team with key personnel from all supporting vendors.

“In the course of managing the pipeline, Alyeska is required to adhere to many regulations imposed by state and federal government agencies. We anticipate that CATSWeb will help us to assure that any notable conditions that are discovered are consistently acted upon in a timely manner and tracked to closure.” Dan Hisey Chief Operating Officer Alyeska Pipeline Service Company

A l y e s k a

P i p e l i n e

Alyeska Pipeline

Compliance Management: A Comprehensive Approach to Assuring Management Actions and Commitments

The consortium of companies that own the Trans-Alaska Pipeline System (TAPS) includes: BP ConocoPhillips ExxonMobil Koch Unocal

One of the longest, most important and most regulated oil pipelines in the world faced a significant challenge: after a comprehensive internal audit of the corrective action process, it was discovered that Alyeska Pipeline Service Company (Alyeska) had more than 60 different methods of identifying problems and correcting them. Officials at Alyeska knew that they needed to streamline their approach to monitoring safety issues, environmental surveillance, maintenance and overall quality efforts to operate the safest and most efficient pipeline system possible. The good news is that Alyeska found a solution. The product selected by Alyeska was CATSWeb by AssurX. To learn more about how Alyeska selected CATSWeb and leveraged it to significantly improve its operations, read on.

The Alyeska team identified four key shortfalls in their process: 1.

2.

3.

4.

Understanding the Challenge After an internal audit of the corrective action process a few years ago, Alyeska’s leadership knew they wanted to improve in some important areas. But when your “office” stretches across more than 800 miles of pipeline, crosses three mountain ranges and 34 major rivers and features the work of 2,000 employees, that’s a pretty tall order. But understanding and addressing challenges is nothing new at Alyeska. Since pipeline startup in 1977, Alyeska has operated with an innovative, positive mindset based on the concept, “As long as there’s oil…we’ll continue to move it.” And move it Alyeska does. The Trans Alaska Pipeline System (TAPS) is an engineering marvel that today moves approximately one million barrels of crude oil per day from Alaska’s North Slope to the Port of Valdez. And don’t forget that TAPS must work closely with more than twenty primary regulatory bodies, including the Department of Transportation, Bureau of Land Management and the U.S. Coast Guard.

their formal business processes should work and then find a tool to adapt to their process – not the other way around. Key to Alyeska’s needs was flexibility, said Mel Jessee, Regulatory Compliance Specialist. “The process always comes first, the tool comes second,” he said. More than crude oil flows through TAPS; there is also a heavy flow of information and regulatory commitments. In 2002, Alyeska set a standard to close 90% of high and medium priority commitments in a timely manner for regulators. In early 2003, the overall monthly delinquency rate ranged between 5% and 20%. Alyeska knew it could do better, and sought a partner to help it reach that goal.

Addressing the Challenge In order to improve their operational efficiency, Alyeska knew that it must first get a clear understanding of its strengths and weaknesses, then invite service providers to show how they could help address those issues, and finally conduct a rigorous evaluation to find the right partner.

It’s a big job to manage. In order to improve their operations, Alyeska wanted to better define how

c a s e

s t u d y

Lack of an intuitive tool, linkages to other processes, and standardized prioritization User difficulty with the current tool has led to the creation of duplicative tracking databases Reporting lacked an easy way for employees to gather data and create adhoc reports because of the difficult user interface; and Lack of linkages with other processes has led to commitments to regulators becoming unfunded during the course of the year, making compliance more difficult.

Alyeska’s overall commitment was to develop a Management Actions and Commitments (MAC) program, that would provide assurance to regulators and the public that environmental, technical and safety related commitments and corrective actions are being effectively managed. “Adequate and appropriate means and procedures for the detection and prompt abatement of any actual or potential condition that is susceptible to abatements… which at any time may cause or threaten to cause a hazard to the safety of workers or to the public health or safety, or harm or damage to the environment.” “We take this commitment seriously,” Jessee stressed. “We wanted to back our strong words with even stronger actions.” To do that, Alyeska used MAC as its corrective action process (CAP). The TAPS compliance model relies on formal business processes to monitor and ensure on-going compliance and conformance. When real or potential deficiencies are discovered, the CAP captures, tracks and helps ensure the resolution of the situation.

Selecting a Solution Jessee and his team knew Alyeska required an excellent system, and they developed a rigorous qualitative selection matrix to help them find it. The software selection matrix focused on important criteria that included: 

   

Risk based on vendor maturity/stability, product maturity/stability and other preliminary costs Process compatibility with defined business requirements User interface and intuitive nature of the product Data compatibility with data fields identified in MAC process Technical compatibility with Alyeska’s IT infrastructure and strategy

“We first looked at developing a custom solution from scratch,” Jessee recalls. But after a look at the high costs, long timeline and other risk issues, Jessee and his team decided instead to search for existing Corrective and Preventive Action (CAPA) systems. They found 13 off-the-shelf offerings that generally matched Alyeska’s requirements. Digging deeper, they knocked ten off the list and focused on the three most likely to be able to meet or exceed TAPS’ demanding requirements. After reviewing the presentations of the three vendors, Jessee and his team asked the top two to provide formal vendor proposals. AssurX’s team worked part-time over a two-week period using a hosted Internet connection to deliver a working prototype within Alyeska’s deadline. “It was simple to tailor the flow and feel of CATSWeb to meet our requirements,” Jessee said.

Implementing the Solution With CATSWeb identified as their choice, the Alyeska team – backed by AssurX support – put together a project team with key personnel from all supporting vendors.

“In the course of managing the pipeline, Alyeska is required to adhere to many regulations imposed by state and federal government agencies. We anticipate that CATSWeb will help us to assure that any notable conditions that are discovered are consistently acted upon in a timely manner and tracked to closure.” Dan Hisey Chief Operating Officer Alyeska Pipeline Service Company

a l y e s k a

“CATSWeb allowed us to implement our business processes without redefining them. This resulted in our ability to efficiently accomplish our business goals.” Kathie May Regulatory Affairs Manager Alyeska Pipeline Service Company

c a s e

s t u d y

“We went through a formal functional design phase and detailed every aspect,” Jessee says. “Before we built anything, its functional design had to be fully understood.” Doing it this way also made certain that all parties approved design details before implementation. “Our implementation process worked out pretty well,” Jessee recalls. Development was done on a hosted server at SysGen in Illinois and another was set up at Alyeska for quality control. Handling testing this way saved a lot of time, Jessee says. “Because of AssurX’s ability to immediately provide a hosted site for development, we didn’t have to wait until all the hardware was installed before we could get moving…we could do things in parallel.” Elaborating on the process, he explains, “We were able to keep moving forward even when we didn’t have the final hardware on-site yet…we migrated information in batch mode, completed certain forms, and then tested them. Once everything worked as designed, then we’d deploy, migrate and install.”

Training & Going Live CATSWeb went live in October 2003 within the approved budget and to unanimous user approval, Jessee says – a trend that continues to the present, as he says, “User feedback has been very positive.”

AssurX, Inc. 305 Vineyard Town Ctr. Suite 374 Morgan Hill, CA 95037 Tel 408.778.1376 Fax 408.776.1267 www.assurx.com

But if the deployment phase went smoothly, the training path was even smoother. In fact, an Alyeska employee designed the training system for other employees. “We took the training process and made it into an interactive tool with audio that explains how the process works and what the different roles are,” Jessee says. It takes only about 30 minutes to go through the training.

New Process Impact Asked to describe ways the new process has impacted operations at Alyeska, Jessee notes

© Copyright 2005, AssurX, Inc. All rights reserved.

for starters that management no longer needs to meet each month to go over delinquencies; instead, the system provides an automatic online report published on the first of each month. “Management is happy; they now have their monthly reports from the home page and enjoy major efficiencies.” Another positive impact: those old 5% to 20% delinquency rates are a thing of the past. Since implementation, there has been a grand total of one delinquency over the past 21 months. Alyeska personnel are now able to “hit the deadlines, monitor assignments and better communicate” observes Jessee. Better still, Alyeska has “raised the bar” for its own performance standards. “Performance metrics have been raised to 99% of all MAC actions and commitments in a timely manner, an order of magnitude improvement,” Jessee says. In addition, over 100 changes have been implemented to date as part of the ongoing continuous improvement program at Alyeska.

A Bright Future “We’re finding new ways to use the tool all the time to manage compliance activities,” Jessee says. For starters, he’s already adding more management processes including document change, reliability centered maintenance, change management and lessons learned. Alyeska officials are working with regulators to identify ongoing regulatory obligations that are due on a quarterly or yearly basis. “By doing this, MAC has been able to assign these recurring actions and assure ongoing compliance by documenting the history,” Jessee says. “Thanks to our new program, we’ll now have a complete history of how we’ve complied.” Like many new uses the team at Alyeska continues to discover, the ongoing regulatory obligations weren’t part of the original project. “The new system has grown with us to help in ways we hadn’t even imagined,” he says.

Alyeska Pipeline Service Company

customer case study

Compliance Management:

A Comprehensive Approach to Assuring Management Actions and Commitments