Land seismic surveys were hard bids to price. Each job could run two to six months, cover hundreds of square miles, use many equipment types, and depend on weather and terrain that made averages dangerous.

Schlumberger's clever move was to make the bid model operational. The simulation varied people, equipment, survey area, region, and weather, so the same model could support both bidding and execution.

The published Interfaces paper reports about $2 million of client cost savings on four surveys and estimates that Schlumberger should save about $1.5 million to $3 million each year across its survey work.

The advantage was not a fancier forecast alone. It turned uncertain field logistics into a rehearsed production plan before Schlumberger had to commit a price.

Bid the survey after simulating the field crew

The model attacked the cost driver directly: field productivity under terrain and weather constraints.

It made crew size and equipment mix testable before the bid was submitted.

It helped the company win more work without hiding risk inside a crude contingency.

The same simulation language could be reused when the survey moved from bid to execution.

When a bid is really a temporary factory, quote the factory, not the average job. A simulation can expose the hidden cost of terrain, weather, and crew sizing.

The paper says Schlumberger used the tool to obtain and profit from a larger share of the global seismic survey market. It also reports demonstrated savings on four surveys and expected recurring annual savings from broader use.

FOLLOW THE EVIDENCE

The sources

  1. Schlumberger Uses Simulation in Bidding and Executing Land Seismic Surveys ideas.repec.org