Sharing Knowledge Through BP's Virtual Team Network
BP The CompanyAt a time when bureaucracy is a dirty word, it's easy to forget that a bureaucracy historically served two essential purposes: it connected the leaders of a corporation to their businesses, and it allowed the businesses to exchange critical knowledge. Have times really changed? Is it possible to have it all: a flat, decentralized, global corporation that excels at learning and has leaders who are deeply engaged in helping to shape the strategy and drive the performance of the businesses? "Yes," declares John Browne, chief executive of the British Petroleum Company. "Advances in information technology now make it possible." Or so BP hopes to prove.
BP today is amazingly flat and lean for a corporation with $70 billion in revenues, 53,000 employees, and some 90 business units that span the globe. There is nobody between the general managers of the business units and the group of nine operating executives who oversee the businesses with Browne. The way Browne sees it, the people in the business units -- those closest to BP's assets and customers -- should run their businesses. And in his view, the value that can be derived from sharing knowledge, not geographical location, should drive the interactions among the business units, which is why he deems BP's virtual team network to be so important.
The Virtual Team Network and IntranetThe aim of this computer network is to allow people to work cooperatively and share knowledge quickly and easily regardless of time, distance, and organizational boundaries. The network is a rapidly growing system of sophisticated personal computers equipped so that users can work together as if they were in the same room and can easily tap the company's rich database of information. The PCs boast videoconferencing capability, electronic blackboards, scanners, faxes, and groupware. But that's not all.
These PCs, as well as all the other 35,000-odd basic PCs in the company, are connected to an intranet that contains a rapidly growing number of home pages. Everyone at BP now has the capability and authority to create his or her own home page. The corporate philosophy: Let a thousand -- or a million -- home pages bloom. As of July, the intranet sites contained approximately 40,000 pages of information.
Home PagesThe home pages serve a number of purposes. There are sites where functional experts describe the experience they have to offer. There are sites for sharing technical data on the muds used as drilling lubricants and for sharing contacts and information about programs and processes available to reduce the amount of pipe that gets stuck in wells. There is a site where people concerned about how to get computers to handle the transition to the year 2000 can exchange ideas. Every technology discipline has its own site. The general managers of all the business units in BP Exploration and Production (BPX) have their own home pages, where they list their current projects and performance agendas.
"If it's easy for people to connect, communicate, and share knowledge, they will do it. If it isn't, they won't," says Kent A. Greenes, BP's virtual teamwork project director. To make it easier, BP is experimenting with a variety of approaches: making videos that can be seen on the network; creating electronic yellow pages that can be searched in a variety of ways; and encouraging people to list interests, expertise, and experiences that they are willing to share with anyone wishing to contact them.
During the recent development of the Andrew oil field in the North Sea, BP used the virtual team network to pass on lessons from the revolutionary project in real time. BP and its contractors and suppliers cooperated to an unprecedented degree to figure out radical ways to cut the cost and time of the project. Using the virtual team network, the project's participants briefed other BP units, partners, and contractors in places as far away as Alaska and Colombia on how they made critical decisions.
Dollars and SenseThe network began in 1995 as a $12 million pilot program in BPX. About a third of the money was spent on behavioral scientists, who helped the people in the pilot programs learn how to work effectively in a virtual environment. "We realized that virtual teamwork required a new set of behaviors," says John B.W. Cross, BP's head of information technology. "It required people to be cooperative and open about what they know, and not possessive about information."
Browne felt that BP should not force the network on people. Rather, he believed that if people saw its benefits, they would ask for it. He was right. "After about six months, we suddenly found out that a lot of people in other groups were asking, 'How do we get one?' Some people were bootlegging and buying the stuff on their own," he says.
In 1996, Browne made the virtual team network available to everyone at BP under one condition: they had to pay for it out of their own budgets. "They said, 'We don't mind. It's just fantastic.' It's an example of how an organization changes itself when it sees something worthwhile," Browne says. As of July, the virtual team network had grown to 1,000 PCs, and Cross expects it to soar to 10,000 by 1999. The network links teams working in the Gulf of Mexico with teams working in the eastern Atlantic near the Shetland Islands, and the PCs are installed in refineries and chemical plants from Indonesia to Scotland.
BP also is extending membership in the virtual team network to outside organizations. For example, the company is using the network to improve the way it works with partners such as Shell in the Gulf of Mexico, and with contractors such as Brown & Root in the North Sea.
Benefits of the NetworkSome of the benefits of the virtual team network are easy to measure:
BP estimates that the virtual team network produced at least $30 million in value in its first year alone. But this estimate does not take into account the harder-to-measure benefits -- such as the ability to see the whites of someone's eyes in a videoconference when he or she makes a commitment.
- A big drop in the person-hours needed to solve problems as a result of improved interactions between land-based drilling engineers and offshore rig crews.
- A decrease in the number of helicopter trips to offshore oil platforms.
- The avoidance of a refinery shutdown because technical experts at another location could examine a corrosion problem remotely.
- A reduction in rework during construction projects because designers, fabricators, construction workers, and operations people could collaborate more effectively.
Top ManagementEach member of BP's top management team and each general manager of the business units has at least one virtual team workstation. Browne has two: one in his office and one in his London home. They allow him to be in two places or more at the same time, he says, describing how he recently participated in separate management conferences in Johannesburg and Singapore from his office. "We had great discussions," he says. "We talked about BP, where it was going, the constraints, the issues that they had. Had I not had the network, what would I have done? Tried to bend my schedule to the point of absurdity? Sent a videotape?"
Browne believes that effective leadership requires personal relationships. It requires continual conversations about competitive dynamics, performance, and corporate values. "These technologies allow the center to stay engaged with the business," Cross says. "Without them, John's organizational model is not sustainable."
More Comments from John Browne, BP's CEO
(Adapted from Prokesch, Steven. 1997. Unleashing the Power of Learning: An Interview with British Petroleum's John Browne. Harvard Business Review 75, no. 5: 147-168.)