Date: Monday 24 February 2020 (1 day)
Instructor: Steve Begg, DecisionsDecisions, Australia
Overview:
There is strong evidence that many Oil and Gas projects are plagued by large cost and schedule overruns, or significant under-performance in productivity and other metrics used to justify decisions.
Business outcomes are largely determined by two factors: the decisions we make and uncertainties over which we have no control. The best we can do to get good outcomes is to make good decisions. But have you ever been taught how to make a good decision? Would you know a good decision if you saw one?
This workshop will introduce key concepts in Decision Analysis (DA) and the Decision Dialogue Process (DDP) – a non-proprietary, rigorous (scientifically underpinned) approach to decision-making, used for over 40 years in a variety of sectors such as oil & gas, pharmaceuticals, IT, military, aviation, environment ….. Together, they provide a prescriptive, pragmatic, auditable methodology (process and tools) to help people create and evaluate choices, leading to high quality, compelling decisions. The methodology is entirely scalable in that its principles can be implemented within a few minutes or over weeks or months, depending on the nature and importance of the decision. Thus it is applicable from relatively small investments (hiring an employee; choosing a supplier of services or software) through to major decisions (acquiring leases; drilling; project developments; or organizational strategy). It is equally applicable to personal decisions.
The workshop will cover the key conceptual ideas that are required to make good decisions and introduce a model that is applicable to most decisions that require a modicum of thought. Attendees will be expected to respond to questions about decision-making and engage in small group discussions and exercises.
Who Should Attend
All people who make, or provide input to, decisions - from relatively minor decisions (e.g. to collect data or do “studies”, analysis, interpretation) up to major investment or strategic decisions. Suitable for all geoscientists, engineers and people involved in commercial, economics, business development, strategy.
Course Content
Questionnaire
Decisions & Uncertainty
Poor business performance and it’s major causes: uncertainty and “flawed thinking”
Decision-making (ranking) vs prediction/forecasting
Clarification of concepts: Uncertainty vs ambiguity vs variability vs risk
Risk attitudes – what they really are/mean and their impact on aggregate decision-outcomes
Fundamentals of Decision-Making
Decision Analysis
Decision Elements & Model
Easy/Hard decisions, Good/Bad Decisions and Incentives
How to make Good decisions
Advocacy vs structured decision-dialogue
Assessing decision quality (DQ) both during and after decision-making process
Simplified version of DA
Centrality of valid reasoning in making good decisions in complex and uncertain situations
Common Biases and Trap in Decision-making: Identification, Explanation and Mitigation
Positive Illusions
Overconfidence
Optimism
Anchoring
Planning Fallacy
Availability, Vividness and Recency
Learning from visual judgments
Summary of Key Points
Instructor’s Profile
Steve Begg is an oil and gas industry expert on decision-making under uncertainty, including asset and portfolio economic assessments and the psychology of decision-making, particularly bias assessment and mitigation. He is co-author of the book, “Making Good Decisions”, commissioned by the Society of Petroleum Engineers. He is an Emeritus Professor of Petroleum Engineering and Management at the Australian School of Petroleum at the University of Adelaide, where he has worked since 2002. For six years, he was Head of the School. Before joining The University of Adelaide, Steve was Director for Decision Science and Strategic Planning with Landmark Graphics Corporation (a Halliburton company) where he was responsible for leading improved economic evaluation and decision-making for both Landmark and its customers. Earlier, he worked with BP for 13 years, the last 6 of which were spent in a variety of senior geo-science and engineering operational assignments in Alaska, which spanned production forecasting, economic evaluation, petroleum engineering, and reservoir characterization roles. He also spent seven years as a researcher and Project Manager with BP Research, where his focus was on risk and uncertainty assessment related to reservoir modeling. His decision-making expertise is grounded in his understanding of the industry, surface and subsurface.
Steve has published numerous papers on topics such as: decision-making under uncertainty; asset and portfolio investment evaluation/economics; psychological factors in judgement & decision-making (bias assessment and mitigation when eliciting subject-matter-expert opinions’ and uncertainty assessments); and reservoir characterization (heterogeneity/uncertainty modelling and up-scaling). He was instrumental in starting the SPE Economics and Management journal. His contributions to decision-making and economic evaluation have been recognized by receiving the SPE Asia-Pacific regional award, and in 2016 the SPE’s top International Award, for the Management and Information discipline.
Steve holds a PhD degree in Geophysics and a BSc degree in Geological Geophysics from Reading University and has attended executive education short courses at MIT and the University of Texas.