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Energy, Oil & Gas Upstream Industry Meeting SCOR for Energy, Oil & Gas: Project Update Forum for industry benchmarking and best practices. Gary Kilponen Treasurer, Director Supply Chain Council Carolyn Lawrence Special Programs Administrator Supply Chain Council. Agenda.

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Energy, Oil & Gas Upstream Industry MeetingSCOR for Energy, Oil & Gas: Project UpdateForum for industry benchmarking and best practices

Gary Kilponen

Treasurer, Director

Supply Chain Council

Carolyn Lawrence

Special Programs Administrator

Supply Chain Council


Agenda
Agenda

  • SCC Energy, Oil & Gas Industry Group Update

  • Seven Steps to Benchmarking

  • Upstream Supply Chain Brainstorming

    • Further Definition of Upstream Supply Chains

    • Prioritize Upstream Supply Chains

  • Next Steps/Action Plan

Oil & Gas Dec 2009


Scc energy oil gas industry group history
SCC Energy, Oil & Gas Industry Group History

Why we chose to create Industry Group?

  • Energy, Oil & Gas Resources are critical business and personal topics that are on the top of mind

  • E, O & G Supply Chains are:

    • Unique (Capital Projects (ETO), Operations (process), EAM)

    • Have limited benchmark data

    • Still very focused on Procurement (Source)

  • Create a Oil and Gas Supply Chain Process Model to enable industry chain benchmarking and best practice implementation

What has happened so far?

  • Energy, Oil and Gas Industry Group formed and kicked off December 2007

  • Teams were formed to address process models and benchmarking, but realized a common high level model was required to move forward

  • The team created a high level Oil & Gas Industry Segment Definition

  • Upstream and Downstream teams have been created and are developing strategies and metrics for top oil & gas supply chains

  • Work has been initiated on development of Upstream Supply Chain Definition

Oil & Gas Dec 2009


Defined the scope of energy oil gas
Defined The Scope of Energy Oil & Gas

  • Initial focus on Upstream, Midstream, and Downstream with articulation of some details of the material flow.

  • Identified Infrastructure Equipment & Maintenance as common area to all three.

Oil & Gas Dec 2009


Benchmarking

Benchmarking

Supply Chain Definition


What is a supply chain
What is a Supply-Chain

Supplier processes

Product Management

Customer processes

Product Design

DCOR™

Sales & SupportCCOR™

Supply Chain SCOR™


What is benchmarking
What is Benchmarking

  • Qualitative Benchmarking

    • Comparing best practices among organizations

    • Maturity Assessments

  • Quantitative Benchmarking

    • Comparing levels of measured performance

    • Assessment of Performance Gaps

  • Competitive Benchmarking

    • Quantitative Benchmarking between companies

    • Identifies superior relative performance


Framework for benchmarking program
Framework for Benchmarking Program

  • Supply Chain Definition

  • Supply Chain Prioritization

  • Supply Chain Strategy

  • Selecting Metrics

  • Sourcing Data

  • Creating a Balanced SCORcard™

  • Performing Benchmark


Supply chain definition
Supply Chain Definition

  • Supply Chains are the Totality of processes spanning operations from supplier to end-customer, focused on material, work and information flow

  • We use a tool called the Supply Chain Definition Matrix to define the Supply Chains within an enterprise

  • The Supply Chain Definition (i/o Matrix) Matrix helps determine the number and size of supply chains

  • Columns: Customers (Output)

  • Rows: Products (Input)

  • The intersection of each column and row – if the goods or services flow to the customer – is a supply chain

Oil & Gas Dec 2009


Column definition
Column Definition

  • The columns in the matrix are focused on demand e.g. channels or segments or customers – start with making a list of customer groups, level by level.

  • Ask your Sales or Marketing functions for customer segmentation information

  • Where you have one customer base with different fulfillment models create two customer segments one for each model

  • In general you can go to any level of detail you want but be sensible.

    Examples:


Row definition
Row Definition

  • The rows in the matrix are focused on supply e.g. business lines or products or locations or suppliers – start by making a list of products, level by level

  • Ask product divisions for product hierarchy data

  • If you have the same product that may be build two different create two different products.

  • In general you can go to any level of detail you want but be sensible.

    Examples:


The matrix
The Matrix

  • We now place the customer list as column headings repeating until finished

  • And then the products list as row headings repeating until finished

  • For each product that flows to a customer, we put an “X” in the cell

  • It’s that simple.

X

X

X

X

X

X

X



Supply chain prioritization
Supply Chain Prioritization

  • We use a tool called the Supply Chain Prioritization Matrix to order the supply-chains according to relevance

  • Each supply chain can be ranked by a number of features

  • We suggest:

    • size (revenue, volume, and margin),

    • complexity (# SKUs)

    • strategic importance

  • You can also look at them by

    • Cash Consumption

    • Risk

    • Volume variability

    • Etc.



Oils and gas industry group next steps
Oils and Gas Industry Group Next Steps

  • Finalize Supply Chain Definition

  • Complete Supply Chain Priority

  • Confirm Supply Chain Strategy

  • Develop Supply Chain Scorecards

Oil & Gas Dec 2009


Participation opportunities and questions
Participation Opportunities and Questions

  • Supply Chain Council Industry Working Group (IWG):

    • www.supply-chain.org/node/61 or

    • www.supply –chain.org/my groups and select the

      IWG: Energy, Oil & Gas Industry Group

  • Next Meeting: June 16, 2010 10:00 EST

Oil & Gas Dec 2009


Contacts
Contacts

Joe Francis

Executive Director

Supply Chain Council, Inc.

[email protected] (Project Sponsor)

Carolyn Lawrence

Strategic Programs Administrator

Supply Chain Council, In

[email protected] (Industry Group Program Manager)

Energy, Oil and Gas Industry Group Executive Team:

Gary Kilponen

Director, Treasurer

Supply Chain Council

Oil & Gas Dec 2009


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