From the September 2007 issue of Treasury & Risk magazine

Finding a Smart Mix

With operations in 80 countries, and an organizational structure that divides the world into four major geographical areas and more than 30 narrower geomarkets, there are few companies that can claim to be any more global than $19.2 billion Houston-based oilfield services giant Schlumberger Ltd.

For Simon Ayat, Schlumberger's executive vice president and CFO since March 2007, the concept of global does not mean totally centralized into "mega-shared service centers." Schlumberger's finance organization is a mix of centralized and decentralized activities. Says Ayat: "Being close to the place of operations has a lot of value for the purposes of compliance and internal controls."

Such an approach has its burdens--especially with revenues growing by 26.8% in 2005, 30.7% in 2006 and 29% in the first quarter of 2007. Nevertheless, the finance organization is highly efficient: Within five business days of the monthly close, Ayat has the monthly revenues, and the profit and loss statement and balance sheet a few days after that. Helping manage such growth are three major enterprise resource planning systems: SAP in North America; Lawson in the rest of the world; and MFG/PRO, a specialized ERP system for Schlumberger's manufacturing and products center.

"Systems are important, but you have to make sure that you have the right people," says Ayat. At the heart of that effort is a process of training and acculturation that immerses the individual in Schlumberger's business culture. Ayat adds: "The best training we have is moving people from one geographical area to another. They bring the practices from their previous assignments to their new assignments." A small business process improvement team ensures unified best practices and processes throughout the organization.

Oil exploration has been hot, but there's always the risk the sector will cool down. While Ayat makes no predictions, he points out: "The cheap oil is behind us"--which could be why he's optimistic strong earnings lie ahead for Schlumberger.


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