In recent years, the extended down cycle of low oil prices has forced deep cuts in capital budgets. The US rig count is at the lowest level in over 70 years. While most industries are continually seeking ways to reduce expenses, the need in the Oil and Gas sector has been particularly acute. In this climate companies need to move aggressively to cut costs and reduce resources.
A Southwestern Oil and Natural Gas company with over 1200 mobile devices needed to bring significant savings and resource efficiencies to their mobility program costs. They were particularly challenged with process of maintaining an up-to-date knowledge of which individual or organization owns each billable mobile device including correct cost center coding to apply monthly cost allocations. Keeping track of mobile inventory can present tremendous challenges particularly with the transitory nature of today’s mobile devices coupled with remote drilling site locations. In addition, manual processes for ordering new devices and upgrades caused delays and proved to be error-prone.
Each month a finance resource would spend up to three days manually mapping accounting cost center codes to a spreadsheet containing each mobile device’s carrier charges. Once this painful process was completed, an input file was finalized and reconfirmed to submit to monthly account payable processing. For years, this was how the task had been accomplished and as the use of mobile devices expanded the time investment grew. When new devices were ordered through manual procurement mechanisms, there was no methodology for capturing the cost center information to lighten the burden of month-end reconciliation. Finally, without accurate information on which employee was assigned to which billing service number, it was difficult to make decisions regarding the termination of billing devices with no usage. With an accumulating number of zero use devices, there was a reluctance to disrupt service without knowing if the user of that device had been terminated.
MobilSense began the deployment by introducing two key levels of automation to address this company’s challenges. First, an online ordering portal that was configured to display only company approved devices, options and accessories. This ordering portal was set up to capture and store accurate information regarding the employee’s name, management hierarchy and applicable cost centers and accounting codes at the time an order is placed. Second, MobilSense engaged in a one-time cleanup to match billing service numbers with employees through the use of HR information. Each device was mapped to an Employee ID and in subsequent months, an HR interface with MobilSentry™ is now used to keep information up-to-date with any personnel changes.
The monthly AP allocation process in the first month of operation was reduced from three days to 30 minutes. The dramatic improvement in the accuracy of reporting each billing device’s owner and organization has not only streamlined the monthly financial process but has facilitated more reliable management reporting capabilities on monthly usage and cost by department. Armed with a Zero Use report from MobilSentry™ and knowing the employee information to be reliable, this company has been able to accumulate over $190,000 in savings from the timely suspension or termination of unused devices. Proactive plan and feature optimization while maintaining precise pool-level buffers, along with the advantages of automation have resulted in over $1M of savings for this Mid-Size company in just 21 months.