At Shell’s fast-growing TechWorks lab, it’s ‘all about deploying’

By Patricia Riedman Yeager

Shawn Murphy faces a curious situation for an innovation lab director: he has to prod his team to play it safe.

shell-murphyAs Center Director of Shell TechWorks, Royal Dutch Shell’s lab based in Cambridge, Mass., Murphy oversees a staff drawn across a spectrum of industries ranging from aerospace and defense to robotics, underwater exploration and data storage. Shell TechWorks’ mission: to accelerate new tech solutions within Shell’s business. Put simply: finding cheaper, faster and safer ways to drill for oil and gas, and future energy sources as they evolve. 

But first, Murphy has to get them to embrace Shell’s Goal Zero policy. In a nutshell: no harm to self; no harm to other people; no harm to the environment. The rules are reinforced in “12 Life-Saving Rules,” posted around the company, which include everything from “Work with a valid work permit when required to” to “Do not walk under a suspended load.”

 “Those are the sacred rules,” Murphy explains. “It’s the most important thing in all of the company. We have it on our goal performance. Everybody has it from the CEO to janitors.”

This was a new concept for even Murphy, a serial entrepreneur and astrophysicist, who joined Shell in 2013 from nonprofit national security and space lab Draper Laboratory, “All the rest of the industries that I’ve ever worked in, especially when you bring in a bunch of entrepreneurs that have only worked in startups, that is absolutely not existent.”

TechWorks’ origins

It has been a busy few years for Murphy, who was working on satellites and an unmanned lunar space mission when Shell came calling. Shell, with more than 94,000 employees, asked Murphy to come up with ideas for a Boston-area lab.

Murphy was excited to create his dream lab under the Shell umbrella. “Shell is really trying to solve the energy problems of the world,” he says. And the pressure is on, with lower oil prices spurring layoffs, lower profits, and decreased capital investment at Shell.

Murphy says his inspirations for the new lab included Xerox PARC, Draper, and the original Lockheed Martin Skunk Works, known for developing famous aircraft such as the U-2 and SR-71 Blackbird. And while not all of his original ideas came to be, in the end the lab came out most closely mimicking Skunk Works in name and mission. “We wanted to emulate something that was remarkably successful,” Murphy says. Skunk Works’ projects “all came in under budget and under time and basically changed the whole industry overnight, with a handful of people.”

“How do you transform something from academic or proven in the lab into a commercial product? It’s very hard to do,” Murphy adds. “99 percent of all products die there. To do that correctly and effectively without blowing budget is one of those of those Holy Grails. It takes a lot of different pieces. That’s the greatest mandate for the company.”

Since it opened its doors with a handful of staffers, the lab has grown to 75 with Murphy at the helm. Murphy intentionally set the lab out to be a multidisciplinary center, recruiting from companies the ilk of E Ink, NASA, Draper, Bluefin Robotics, Raytheon and EMC.

Early projects

shell-aps“We’ve rolled out seven programs in those first two and half years, which is crazy fast for most industries,” he says. “This happens when you have this intersection of various disciplines in one place with a specific goal and specific mission and you empower them with mission command, that bias toward action. It’s hard to hold everything together — it’s a high stress job — but it’s amazingly rewarding.”

The theory is that drawing employees mostly from outside the oil and gas industry enables Shell to import new technologies, methodologies and entrepreneurship and apply them to the larger group in novel ways. For instance, one solution currently being tested at the Cambridge lab is a pipe sensing system that detects pipe location and helps “thread” them together to be laid in place using technology inspired by the camera inside the Xbox 360 video game console. It’s not just gameplay; it’s about removing humans from the harm’s way on an oil rig platform near big equipment. In addition to reducing risk of injuries, Murphy says, using robotics increases efficiencies because there’s no worker fatigue. (At left, Shell TechWorks engineer Leland Smith sets up the pipe sensing system on a test rig.)

“You can go fast because you don’t have humans running the machines,” he says. “You can run the machine constantly at peak performance, and you can increase precision. So, you have intrinsic benefits all over the system with a very inexpensive technology, which is just adapted to this application.”

Murphy says the technology, which is being tested at a Shell facility in the Dutch town of Rijswijk, is currently being bid out between manufacturers, but he expects it to be deployed, once all the signing and technology transfer occurs, sometime this year.

shell-leak-detectionFor a project called SeaScan, Shell TechWorks collaborated with the Shell’s exploration and deep-water operations unit and a number of outside companies to use mass spectrometry equipment to detect new reservoirs of hydrocarbons (oil) for exploration, and also to detect leaks at existing operations. Shell’s technology enables real-time detection of identification of hydrocarbons that seep naturally from the ocean floor. Or as Murphy says, “Basically sniffing hydrocarbons under the water and fingerprinting them in real-time. That was a revolution because that would usually take three weeks through the normal process.”

In addition, this technology doesn’t touch the ground, so doesn’t disturb underwater marine life, and is thus better for the environment. It is also more cost-effective as it produces faster more accurate data vs. the traditional 2D scans of seismic data. (At right, the Shell TechWorks team brings an autonomous underwater vehicle back on board after a successful test run in Boston Harbor.)

Challenges to building a cohesive team

While bringing people from different industries into one lab has many benefits, it also presents challenges.  Whether they come from the Department of Defense or the semiconductor industry, “they bring their own processes and biases to the plate,” Murphy says. “Once you recognize the cultures, you have to reconcile the different personalities, which are high-functioning, into a cohesive strategy to adapt scale and basically do a force multiplier on the thing that you’re doing.”

Uniting the team behind the Goal Zero policy was one of the major steps toward doing this, he says. Strong leadership is also essential, Murphy says. A fumbling, unpolished management style and “They’d eat you alive. They’d ask, ‘who’s this joker? Did I leave the pinnacle of my career to come over here to get lectured on MBA 101?’”

Personality tests even come into play. Staffers at Shell TechWorks take the MBTI Personality Test from Myers-Briggs to help better understand their personal strengths and weaknesses and how they can incorporate themselves into the fabric of the team. Murphy also cites a few management authors he’s used to structure TechWorks, including Stephen Bungay, who writes about how to empower staff working at lower levels by dispersing decision-making into layers and allowing them to be entrepreneurs. At the same time, he adds, “You have to be very clear about your mission is. If you don’t have a clear mission than things break apart.”

Blowing up preconceived biases is something that Murphy believes Skunk Works excelled at, and Shell TechWorks tries to emulate. But it’s not easy, he admits. “People have been rewarded and they’re alive with those biases, and all of a sudden we’re asking them now to break those and use an amalgam of different cultures in order to create something new.”

Other innovation initiatives at
Royal Dutch Shell

ShellGameChanger: Celebrating its 20th anniversary this year, GameChanger funds and provides technical assistance to future energy development, such as the world’s first floating liquefied natural gas project. All of its spend goes to foster innovation outside of Shell and bring back opportunities.

Shell Technology Ventures: STV invests in companies in oil and gas as well as in the alternative energy sector, especially companies which have technology that may complement Shell’s.

Academic Research: Shell does external technology collaboration with ten primary universities around the world and also does minor funding with several hundred others. It’s also a founding member of the MIT Energy Initiative.

FET (Future Energy Technology) Their mission is to understand, sponsor, and develop new technologies so Shell can prepare itself for the transition of the world when it’s not dependent on oil and gas.

Funding from the business units

Another thing that sets Shell TechWorks apart from other labs is how it’s funded. TechWorks has only used 10 percent of Shell’s initial seed funding, and Murphy says it is now completely self-sufficient. “Our growth depends on our performance,” he says, noting that it’s been doubling revenue every year. “We do not take a single dollar for our line management. We needed to go within the business and understand the business, and the business funds all the projects for us. What that does—because Shell is such a large ecosystem you can do that—is foster entrepreneurship and innovation because you are not relying on funding crutches that come from above. You need to write proposals and execute the projects like you’re in a free market.”

Reporting and motivation

Murphy reports to Chris Laurens, Vice President Innovation and New Energy Technologies. “We have quarterly meetings,” he says. “We meet for two days. We talk about the general strategy, what’s happening in the world. How is our innovation portfolio going? How we can interact? How do we accelerate the funnel? What are other energy companies doing?”

Murphy describes his job as “one of the more fascinating jobs that anyone could ever have,” in part because the stakes are so significant. “We know by 2050 the world population will double—it will go to about 9 billion. The energy demand on energy will quadruple. And we want to reduce the C02 footprint by 80 percent.” Doing that requires finding major operational efficiencies in the present business, and generating cash to invest in longer-term projects. “It’s a very complicated technology strategy as well as a business strategy,” he says.

As for what motivates him and his team, Murphy says that “it’s all about deploying. Entrepreneurs…are not satisfied if they don’t see their products deployed,” not just writing an academic paper or delivering a PowerPoint deck. “That’s one of the main genetic traits of entrepreneurs,” he says.

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