Part Two: Electronic Delivery Tickets…Duh!

I’m a Consultant in the energy industry, This post is a continuation of the story I was telling about spending a day with a prospective customer out at a rig supply yard. The delivery ticket had just flown out the window. (READ ALL OF PART 1 HERE)Here’s what happened next…As we got back in the truck, we quickly scanned the delivery ticket in it’s now partial form and sure enough, the ticket was for the delivery just made. When we discussed the cost, factors involved and potential ramifications on the surface they seemed insignificant. This is how the conversation went:

Shawn Smith (VP Operations XYZ Oilfield Services): “I wonder how many times this might happen? David, in your experience do you see this often?”Eval_Guide_Tech_Upgrade_Background_01

David: “Shawn, I see this type of result far too frequently. I have been on discovery meetings with other oilfield services firms and pulled delivery tickets out from between the seats in pick-up trucks, I have seen a couple of examples of delivery tickets destroyed by Chick-fil-A sauce…it doesn’t surprise me. What will surprise you is the impact this has to the business.”

Shawn: “I don’t even know if we have discussed this before and no one has ever raised this as a regular occurrence. I need to check with Miss Lisa at the branch office to see what this situation looks like…in fact…let me call her now.”

“Hi Miss Lisa, this is Shawn…how are you?”

Lisa: “Why fine Shawn…you? What can I do for you?”

Shawn: “Lisa, I was just following Bubba on a delivery and while we left the clients rig site, his delivery ticket flew out his window. Thankfully we were able to recover it.”

Lisa: laughing…(really hard). “Well Shawn, I thought that was always only an excuse I would get. Glad you were there to retrieve it because that saved me a ton of work.”

Shawn: “Like what?”

Lisa: “How much time do you have?”

Shawn: “Okay, I will stop by the branch after lunch.” Hangs up

Shawn to David: “Well, this should be interesting.”

David: “Shawn, the big take away here is this was one incident where a manual process was broken. Multiple this by your fleet of 25 delivery vehicles, 35 Frac Trucks, 20 Wireline trucks, 25 Service Trucks plus all the crews you have and you quickly see how much this can impact a business. When your company is storming around at $100.00 + per barrel, this may not be as acute a problem. Now, at $45.00 a barrel of Oil, cash flow is king….and I guarantee you that mishap would have cost you at least 45 days of Days Sales Outstanding on top of your current terms with the operator. “

Shawn: “I think I just lost my appetite for lunch.”

Stay with us as we visit with Miss Lisa back at the branch office where we work to understand the “as is” business process that deals with the delivery ticket issue, the workflow behind the process, the manual nature of the revenue capture process and the strain it places on the organization.. previously unknown to Shawn. TO BE CONTINUED…

Author: David Huether, Vice President of Sales and Energy Solutions