THE DRILLED-WELL SCORECARD - A STEP TO BUILDING A LEARNING ORGANIZATION

Performance measurement is useless if it does not lead to process impr ovement. Evaluation of individual functional areas alone will not nece ssarily lead to a better overall process. The effectiveness of process inputs, outputs, and actions must be measured against the organizatio n's underlying goals. Union Pacific Resources Co. (UPRC) is not in bus iness just to drill holes in the ground; it is in business to make mon ey. Ideally, all actions in the process should reflect this goal. To d escribe this system phenomena, UPRC and OGCI Management Inc. developed an adaptive control model of the drilling process, a drilled-well sco recard performance-measurement system to reflect the relationships in this model and to make performance evaluations that lead to real, cont inuous improvement. The scorecard facilitates communication across tea ms, documents project goals and assumptions, measures the effectivenes s of drilling plans in meeting these goals, and reconciles the differe nces between intended and actual results. If these scorecards are used for postproject analysis and then to help plan future projects, they can facilitate organizational learning, characterized by the following . 1. Defines specific goals linked with financial performance. 2. Ensu res actions are directed at meeting these goals. 3. ''Remembers'' how decisions were made. 4. Builds an accessible reservoir of the right ex pertise and technology. 5. Accurately monitors performance. 6. Uses ex perience to adapt practices to ''do better next time.'' When an organi zation uses the scorecard as feedback, it can capture the benefits of its experience. UPRC plans to use the experience stored on the drilled -well scorecard as part of an effort to improve both its planning proc ess and its project execution-as a step to building a learning organiz ation. Again, this should be the goal of any performance-measurement p rogram.