http://www.microsoft.com/TechNet/analpln/cs/amoco.htm (PC Press Internet CD, 03/1996)
| Updated: March 14,1996 |  Go To TechNet Home Page |
Industry
Petroleum exploration and production
Business Solution
Decision-support system for cost estimation and project evaluation
Architecture
Enterprise-wide client-server solution based on Microsoft BackOffice products running on Novell NetWare local area networks and accessing microcomputer- and minicomputer-based databases and expert systems
Figure 1
Products and Services Used
Microsoft Developer Network
Microsoft Excel
Microsoft Excel Software Development Kit
Microsoft FORTRAN PowerStation 32
Microsoft Office Professional Edition
Microsoft Project
Microsoft SQL Server
Microsoft Test
Microsoft Visual Basic
Microsoft Visual C++
Microsoft Win32 Software Development Kit
Microsoft Windows NT Server
Microsoft Windows NT Workstation
Microsoft Word
Increased accuracy, efficiency, and consistency in project estimates and evaluations; new capabilities in decision support
Even a hundred years of practice can't make some jobs easy. One of them is predicting the total life-cycle cost of developing oil and gas. But now at Amoco Corporation-which has found, produced, and marketed plenty of oil and gas since its beginnings in 1889-managers and engineers have a better opportunity than ever for quickly and effectively gauging the life-cycle cost of major exploration and production projects.
Providing this opportunity is a powerful new decision-support system that helps evaluate the business potential of upstream onshore and offshore developments. Known as PETS (Project Evaluation Tool Set), this client-server system imposes new standards and consistency on the increasingly complicated cost-development process. At the same time, it supports Amoco's contemporary information-systems vision and strategy.
A Prime Candidate for Reengineering
The motivation behind the PETS system originated from the increased competitiveness and extreme cost-cutting measures in the petroleum industry in the early 1990s. At Amoco's Houston-based E&P (Exploration & Production) Sector, those measures led to a reorganization of work processes and downsizing of information systems. The downsizing effort included moving from a mainframe environment to one based on a networked client-server model.
Even as Amoco E&P was streamlining and simplifying its work processes and operations, however, project cost estimators faced a task that was more complex and demanding than ever. Estimators were deriving
data from diverse sources, massaging it, and then processing it using 15-year-old mainframe legacy applications and rote number-crunching. From engineer to engineer, conceptual cost estimates could vary by up to 40 percent. For projects costing hundreds of millions of dollars, even small cost variances could carry enormous business implications, and sizable ones could be catastrophic.
As the organization implemented downsizing plans in 1992, Amoco E&P Construction Leadership Team members Glen Blackburn, Frank Cremer, and Terry Wood realized that the problem of predicting life-cycle costs was a prime candidate for a reengineering solution. To help them outline and build the solution, they enlisted Mike Brulé, president of Technomation®, a Houston-area Microsoft Solution Provider.
As Brulé and the leadership-team members saw it, such a solution would need to help Amoco E&P combine and streamline preliminary engineering design, cost estimation, economic evaluation, project scheduling, and risk analysis for both new business development and ongoing operations alike. The solution would also need to support a new cultural and management approach, one that would emphasize imagination and creativity, to project evaluation and business development.
In sum, the business challenges were daunting. But the leadership-team members decided the results would be worth the risk. In early 1993 they laid the groundwork for the solution by assigning the responsibility of specifying functional requirements and managing the project to the Amoco E&P Cost Development Team, led by Mike Ruggiero.
Meeting the Technical Requirements
As members of Ruggiero's team soon found out, the technical requirements were as challenging as the business requirements. Because members of the team bore responsibility for cost estimation to the entire Amoco E&P operation, they specified a solution that would be general, quick to learn, and easy to use, and would be based on an extensible and reusable architecture. It would be able to communicate with applications and databases running on UNIX® workstations. It also would be able to salvage components of existing data sources and software while aligning with the company's computing standards and expanding client-server systems.
In response, Brulé and Ron Sanvido, another team member from Technomation, began evaluating the Microsoft® Windows NTTM operating system. In addition to its performance, extensibility, compatibility, and power, Brulé and Sanvido saw a key practical advantage of using Windows NT. "We knew that Windows NTTM Workstation would be capable of running business and engineering applications on a single box," Brulé says. "That could mean a major advantage for users and the whole organization in terms of convenience and cost."
Ruggiero also saw the strong potential of a Windows NT-based solution. "The Windows® operating
system and the Office suite of desktop tools had become standard here," he points out. "We determined that any new software incorporating the Windows user interface would likely gain wide and easy acceptance."
Once the operating environment was selected, the developers chose the Microsoft Visual C++TM development system and the Microsoft Visual Basic® programming system for their development tools. "Because the Windows NT SDK already supported Visual C++, it seemed like a natural choice," Brulé points out. "We selected Visual Basic and Visual Basic for Applications because we knew they would provide the fastest way to build interfaces and customize popular applications such as Microsoft Excel, Microsoft Project, and Shapeware Visio."
The Right Tool for the Job
For the next 15 months, analysts, planners, testers, and developers worked on migrating some 15 years' worth of mainframe applications into the PETS system. The developers extended the functionality of various off-the-shelf 16-bit Windows-based and Win32®-based applications by using OLE, Visual Basic, and the Microsoft Foundation Class (MFC) libraries available through Visual C++.
Essential to the initial release of PETS and its further funding was the migration of the mainframe applications into Microsoft Excel spreadsheets. "Microsoft Excel proved to be indispensable," Brulé says. "For us it was a fantastic development environment because of its SDK and Visual Basic for Applications. Using Visual C++, Visual Basic, Professional Edition, and FORTRAN PowerStation 32 together, we were virtually unlimited in developing sophisticated engineering and calculation tools."
Figure 2
Also critical to the development of PETS was having tools that fit the problem at hand. "Having a number of tools, and having them all work smoothly together, really helped propel development," Brulé explains. "The IPC [interprocess communication] mechanism demanded high-speed DLLs, and Visual C++ was the obvious selection there. For building quick interfaces and customizing applications through OLE Automation, Visual Basic worked best."
The built-in integration of the Windows-based tools, systems, and applications also played a significant role. "The integration of these products helped us impose vital standards on PETS and the cost-estimation process itself," Ruggiero explains.
The developers also took advantage of Microsoft Test. According to Brulé's estimates, Test helped them automate 60 percent of their testing and trim over 10 percent off normal development time. For support, developers used the Microsoft Developer Network (MSDN) extensively.
Enterprise-wide Functionality
Now in its second release and being used by a core group of engineers and analysts, PETS contains more than 40 components, including sophisticated spreadsheet programs, databases, a knowledge base, and third-party Windows-based, Win32-based, and specialty applications. PETS resides on a server platform running Windows NTTM Server and is linked through enterprise-wide Novell® NetWare® networks with client computers running Windows NT Workstation.
"Because of the power and resources required to run the many components of PETS, having Windows NT running on the client platform was imperative," Brulé explains. "We determined that only Windows NT Workstation could provide the robustness we needed for running many 16- and 32-bit applications on the desktop."
For cross-networking and communications with both UNIX- and Windows-based workstations, PETS depends on an object-oriented, asynchronous IPC architecture built with TCP/IP and the Windows Sockets API in Windows NT. For its primary databases, PETS uses Microsoft SQL ServerTM. These databases are accessed by up to a dozen users and developers simultaneously and typically provide comprehensive project information in two to three seconds.
Huge Data Warehouse
For Amoco E&P, PETS synthesizes the knowledge stored in Amoco's legacy applications with enormously enhanced functionality. It also presents a large repository of information in formats familiar to users, including customized Microsoft Excel spreadsheets, Shapeware Visio drawings, MapInfo geo-coded maps, and soon-to-be-released Microsoft Project schedules and Word compound documents-all in the Microsoft Windows user interface.
"Now, project estimators are using the same platform, applications, and data so that we can efficiently develop standardized, comprehensive, and consistent project estimates and evaluations," Ruggiero explains. "With PETS we have a cost-development tool set unlike anything we've used before, including a variety of powerful analytical applications for costs and scheduling. Moreover, PETS provides an example of a comprehensive and low-cost system leveraging off third-party applications, including those in Microsoft Office. PETS is a model of what corporate Amoco can do in a client-server environment-given the vision, resources, and support of management, and the talented team members who latched onto the vision and made it a reality."
So far, the numbers bear him out. Preliminary findings suggest that PETS already is helping estimators work better and faster, with cost estimate variances approaching 25-30 percent in contrast to the previous 40 percent for offshore platforms. Users also are cutting the time required to access and generate vital project information by nearly 60 percent.
Future Deployment Throughout
the Corporation
Today, the PETS development team is working on a release scheduled for December 1995 that will include system-wide refinement and new functionality. Leveraging off the extensibility of PETS, the release also will support additional business areas, including downstream petroleum products and chemical processing operations.
In addition, the December release will include a hypertext-based, "lessons learned," fuzzy-logic expert system. Among a range of other enhancements, the release will feature user-specified database-query capabilities, project scheduling, additional graphics, and a compound-document reporting capability based on Word and customized with WordBasic.
In the short term, PETS users will continue to consist of the core development group, project estimators, and ad hoc project teams. For the long term, Ruggiero and his team plan deployment to pertinent business units throughout Amoco Corporation. It's a move that team members anticipate with a great degree of pride. "What used to be only a vision will become a reality," Ruggiero says. "With PETS, we'll be taking decision-making capabilities that were centralized for decades and putting them into the hands of project-development teams throughout the company."
For More Information
For more information about Microsoft products, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Customer Support Centre at (800) 563-9048. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary.
© 1995 Microsoft Corporation. All rights reserved.
This document is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.
Microsoft, Visual Basic, Win32, and Windows are registered trademarks and Visual C++ and Windows NT are trademarks of Microsoft Corporation. NetWare and Novell are registered trademarks of Novell, Inc. UNIX is a registered trademark of Novell, Inc., in the United States and other countries, licensed exclusively through X/Open Company, Ltd. Technomation is a registered trademark of Technomation Systems Inc.
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0395 Part No. 098-58434 (printed document)
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