Why an Operations Excellence Management System (OEMS) Is Critical in High-Hazard Industries
High-hazard industries – like oil and gas, chemical manufacturing, nuclear power, and mining – deal with processes and materials that can cause catastrophic harm if mismanaged. A strong operations excellence management system (OEMS) is a necessity to keep things running safely, efficiently, and profitably.
Large multinational corporations have had operations excellence management systems in place for years. As a result of mergers, acquisitions, and divestitures, segments of these operations now have new owners faced with the need to establish an OEMS to ensure continuity amid complex transitions. An OEMS helps mitigate the risks that come with splitting operations, reallocating resources, and redefining processes, all of which can disrupt production, supply chains, and quality control.
In this first of a three-part series, we’ll look at exactly what comprises an OEMS and why it’s fundamental to business success. Part Two will highlight the key activities of an OEMS particular to operating a business in a high-hazard industry. Finally, Part Three will discuss where to start your OEMS journey and how to integrate it into existing company practices.
So, to begin…what exactly is an OEMS? An operations excellence management system is a documented set of policies, standards, processes, procedures, and associated tools used to manage and streamline the day-to-day operation of a business. In a nutshell, an OEMS helps a business:
- Plan resources (labor, materials, and machines)
- Coordinate (suppliers, deliveries, and logistics)
- Schedule (when and how work gets done)
- Monitor (efficiency, costs, and performance in real time)
- Control (manage risk and ensure products/services meet standards)
Envision the OEMS document structure like a pyramid:
At the top of the pyramid are company-wide policies that communicate leadership’s expectations to all stakeholders. The next layer down identifies and establishes standards of operation across all functions (engineering, safety, environmental, cybersecurity, quality, etc.). This is followed by documented processes describing who does what and establishes authorities, accountabilities, and responsibilities. Procedures provide the step-by-step instructions necessary for consistent execution of key activities. Finally, data and records are generated to report, analyze, and improve the business.
Organizing your business documentation within the framework of an OEMS provides a foundation for effective control and continuous improvement. An OEMS is fundamental to your business success for several reasons.
- Safety: High-hazard industries handle volatile substances and complex processes where a single misstep – a valve left open or a faulty instrument ignored – can lead to explosions, fires, and toxic releases. An operations excellence management system (OEMS) enforces rigorous standards, training, and safeguards to minimize human error and equipment breakdowns.
- Reliability: Downtime in these sectors is extremely expensive. A refinery offline for a day can lose millions. To effectively manage risk, an OEMS locks in preventive maintenance, process optimization, and real-time monitoring. Avoiding disasters is critical, but so is ensuring that the plant runs reliably.
- Compliance: Governments and regulators watch high-hazard industries closely – think U.S. OSHA-PSM (Process Safety Management) and SEVESO (European Union directive). A strong OEMS ensures you’re staying far ahead of bare-minimum rules by avoiding fines, shutdowns, and legal trouble. It also supports building a culture of proactive safety
- Cost control: High hazard doesn’t mean high waste. With an OEMS, you can cut energy use, reduce raw material loss, and streamline resources. An effective OEMS ensures senior leaders are aligned on the company’s risk profile, validating investments and supporting budget justifications.
- Reputation: One major incident doesn’t just hit the balance sheet – it undermines public trust. An OEMS shows stakeholders, insurers, and communities that you don’t cut corners. It highlights your willingness to communicate transparently and underscores that you’re serious, even with new assets or acquisitions.
It’s simple: in these industries, the margin for error is razor-thin. A strong OEMS is the platform that keeps the whole operation from collapsing under its own risks. Becht has experience developing, implementing, and executing operations excellence management systems in high-hazard industries. We can assist any company who desires to establish or improve an OEMS and can help “right-size” it to align with your company’s business purpose and scope. Let us know how we can support you.
Like what you just read? Join our email list for more expert insights and industry updates.
