Winning IT Strategies for Asset Lifecycle Planning and Portfolio Management

Transcription

1 Winning IT Strategies for Asset Lifecycle Planning and Portfolio Management SAP s Perspective and Customer Case Study Ken Evans Sr. Director, Oil & Gas Industry February 9, 2010

2 Agenda 1. SAP Solution Context Planning, Building, & Commissioning Assets 2. Engen Petroleum Case Study Excerpts from Presentation given by Mario Danieli in April What s at Stake? Meeting the Sustainable Energy Challenge SAP AG All rights reserved. / Page 2

3 Agenda 1. SAP Solution Context Planning, Building, & Commissioning Assets 2. Engen Petroleum Case Study Excerpts from Presentation given by Mario Danieli in April What s atstake? Meeting the Sustainable Energy Challenge SAP AG All rights reserved. / Page 3

4 SAP Enables Safe, Effective, Efficient, and Responsive Operational Performance PLAN & DESIGN PROCURE & BUILD Planning, Building, and Commissioning Assets COMMISSION OPERATE MAINTAIN RETIRE Centralized Sourcing and Contract Management Asset Visibility and Performance Optimized Asset Operations and Maintenance Operational Risk Management Customers maximize asset availability, utilization, uptime, compliance, quality and efficiency with natively integrated end-to-end business processes Improve planning, accelerate operational readiness, and reduce maintenance costs with collaborative staging and access to enhanced asset-related information. Gain transparency into demand and ensure global contract compliance, enabling procurement to sustain savings and reduce operational costs and supply risk. Improve asset performance, and increase productivity and efficiency by increasing visibility into manufacturing processes and sharing best practices. Improve run-time production and reduce costs with an integrated maintenance program that enables higher equipment reliability and improved resource allocation. Drive towards a zero incident rate and decrease total costs across multiple plants by reducing risks and improving operational visibility. SAP AG All rights reserved. / Page 4

5 Planning, Building, and Commissioning Assets End to End Process The SAP solution connects business planning, portfolio assessment, capital project management, and asset information management to ensure operational readiness. COO Steering Committee PMO VP of Engineering COO Manage Asset Portfolio Manage Capital Projects Manage Asset Information COO, CFO Controlling Long-term Planning Capital Budgeting Program Governance Engineering Plant / Maintenance Engineering Development Collaboration Electronic Import of Eng. Data Transformation and OEM collaboration Capital Projects Project Manager Initiate Project Project Planning / Estimation Project Execution Project and Investment Controlling Maintenance Maintenance Manager Plan Asset Replacements / Addtions Collaborative Construction Document Management Technical Assets Management Supply Chain VP, Supply Chain General Contracts MRO and Services Procurement Technical Parts Management SAP AG All rights reserved. / Page 5

6 SAP Portfolio and Project Management example process for Capital Projects Portfolio Management Define Strategy Identify Investment Opportunities Analyze Risk and Rank Opportunities Create and Approve Budgets Initiate Project Monitor Portfolio and Project Execution Project Management Structure Project Plan Resource Requirements / Costs Procure Materials and Services Collect Actuals Monitor Project Resource Management Strategic Planning Demand Management Talent Management SAP AG All rights reserved. / Page 6

7 Oil & Gas, Mining customers using SAP to manage their Capital Projects Integrated Long-Term Planning, Budget Process and Projects execution at the world s largest platinum producer SAP RPM 4.0, SAP PS, MS-Project Align strategy & capital spend Understand resource & budget constraints. Integrated and auditable capital planning & monitoring Prioritizing and Monitoring the Portfolio of 2000 Modifications to comply with Health, Safety & Environment requirements SAP RPM 2.0, SAP PS, SAP PM 4.6 C Integration and creation of Portfolio Item from PM-Notifications Collaboration Link to Teamsite R/3 Transactions available in the Portal Actively managing the Portfolio of Capital Projects and Investments at the Engen Refinery SAP RPM 4.5 implementation at Refinery in Durban for capital projects in 6 month; Phased Rollout of Initiatives, Programs, Projects PS-Integration across the business 350+ Oil&Gas and Mining companies rely on SAP:... to manage daily project operations and maximize the value of their capital projects SAP AG All rights reserved. / Page 7

8 Agenda 1. SAP Solution Context Planning, Building, & Commissioning Assets 2. Engen Petroleum Case Study Excerpts from Presentation given by Mario Danieli in April What s atstake? Meeting the Sustainable Energy Challenge SAP AG All rights reserved. / Page 8

9 Project Portfolio Management drivers Maximise Value Strategy alignment Prioritisation Track project progress Capacity Planning Track benefits

10 Project Portfolio Management Model

11 Implementation: Capability assessment Assess capability to determine adoption / scope PPM Capabilities Maturity

12 Process: Two-phased Model Authorising the right projects, aligned with strategy and maximising value against a balanced risk Standard stage-gate process, to ensure that projects follow a standard project lifecycle for efficient project execution ( doing projects right )

13 Bucket structure ENGEN PORTFOLIO DIVISIONAL REFINERY PORTFOLIO DIVISIONAL E&G BUCKETS SIB ENGEN INTERNATIONAL SALES & SUPPLY, TRADE & CORPORATE BUSINESS MARKETING OPTIMISATION E&G SIB E&G SIB E&G SIB E&G SIB Stay in Business By Stream By Strategic Objectives (customised for Division) Reliability Retail Infrastructure Commercial Brand Building Health & Safety Distribution Downstream Supply Chain Environmental Aviation Human Capital Capability LPG Statutory Stakeholder Engagement Chemicals Brand & Image Strategic Partnering Lubes Superior Operational Bitumen Performance Business Improvement Convenience Refinery Corporate Expansion & Growth STO SIB BUCKET INITIATIVE A ITEM 1 ITEM 2 Phase Plan Amt Feasibility Study 1000 Conceptual Engineering 2000 Basic Engineering 3000 Execution 4000 YR1 YR2 YR10.. Apr May Jun 50 Jul 200 Au g 150 Sep 100 Oct 50 Nov 50 Dec Jan 100 Feb 100 Mar REF-SIB REF-E&G IBD-SIB MANAGEMENT INITIATIVE NON NEG IN PROCESS SCORE OVERRIDE Initiative A YES NO NO 10 Initiative B NO IN NO 15 Initiative C NO IN NO 20 Initiative D NO NO YES 25 Initiative E NO NO NO 80 Initiative F NO NO NO 70 Initiative G NO NO NO 60 Initiative H NO OUT YES 55 DIVISIONAL RECOMMENDATION 700, , , , , , ,000 0 CAPEX Ask for FY2010 by Stream CAPEX Ask for "New" work E&G versus SIB RETAIL 4,000,000 26% 3,000,000 2,000,000 E&G 1,000,000 REFINERY SIB 62% 0 Apr May Jun CAPEX Ask - planned monthly spend - FY2010 Jul Aug 1 Sep Oct Nov Planned Spen d De c Jan Feb Planned Spe nd Mar BAPP IBD -SIB Leveraging RPM Portfolio Planning Capture initiative and item information Select, balance and recommend Approve Create Initiative & Items Further classify initiatives into strategic categories Initial classification into SIB or E&G Capture details for scoring Update Financial and Capacity Planning Evaluate Scoring Select based on the evaluation results - Review Recommend initiatives Use rank ordered list to establish priorities Ranking Scoreboard Review portfolio BI Analytics Standard Capital planning approval Ranking Scoreboard Categorisations Item Financial Planning Reviews Ranking Scoreboard Sample Analytics Ranking Scoreboard FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY

14 Project Cost Report Phase Checklist & Decision Point Approval Leveraging RPM / PS Project Execution Complete each project stage requirements prior to stage gate approval & progression to next stage Create SAP PS object (auto) Identify possible Options Conceptual Design Develop project execution plan Execute work Final project settlement t (PS) Business benefits review 50% cost estimate, schedule 30% cost estimate, schedule 10% cost estimate, schedule Close project (PS) Close Initiative, Close Item (RPM) SAP IM/PS Distribute budget from IM to WBS, Update cost plans & RPM version, Create Commitments, Confirm/incur actual costs SAP RPM Update Item / Initiative values, Complete phase checklist, Approve Decision Point (gate), Complete snap shot 1 SAP BI Project Execution analytics 1 14

15 Benefits Measurement Qualitative A consistent base for making decisions and excluding projects or programmes according to defined criteria, applied fairly Increase alignment between planned spend and strategy More rigorous assessment of the financial worth of the project portfolio Frequent management of the portfolio of projects Increased business leadership accountability for project results Processes to track project benefits Quantitative Significant shift in planned spend patterns aligned with strategy Shift in project start dates resulting in a more achievable portfolio Specific savings due to increased visibility

16 Lessons learned 1. The PPM process does not automatically select the right projects to implement, it is a decision support tool. 2. The entire process is dependent on a clearly defined corporate strategy and the PPM process by itself does not guarantee the vision will be achieved. 3. PPM is a cross-functional process integrating strategy, accounting, project execution and operational management. 4. The portfolio structure i.e. where the selection committees sit within the organisation, centrally or decentralised, is a key issue. 5. Business Intelligence plays a significant role in enabling evaluation, g p y g g, selection, balancing and tracking via multi-dimensional views of the Capex Portfolio

17 Agenda 1. SAP Solution Context Planning, Building, & Commissioning Assets 2. Engen Petroleum Case Study Excerpts from Presentation given by Mario Danieli in April What s at Stake? Meeting the Sustainable Energy Challenge SAP AG All rights reserved. / Page 21

18 What s at Stake? Meeting the Sustainable Energy Challenge Per the International Energy Agency s Latest World Energy Outlook, November 2009 The capital required to meet the project energy demand through 2030 in the Reference Scenario is huge, amounting in cumulative terms to $26 trillion (in year dollars) equal to $1.1 1 trillion (or 1.4% of global l GDP) per year on average. Additionally, there is an additional $10.5 trillion more investment needed to put the world onto a 450-ppm path in this same time frame. $36.5T of fcapital linvestments t into New and Existing Assets that has to be Efficiently and Effectively Managed SAP AG All rights reserved. / Page 22