Boston Strategies International (BSI) set the bar for excellence in supply chain management by authoring the definitive Guide to Supply Chain Management, which was published by The Economist. Is your operation world-class?
Each year our firm conducts an in-depth global oil and gas supply chain benchmark study in which diverse companies respond from countries as widespread as Australia, Germany, India, Italy, Nigeria, Norway, South Africa, and the United States. Winners are evaluated based on their demonstrated supply chain processes and performance on nine Dimensions: Supply Chain Strategy, Supply Chain Organization, Demand and Capacity Planning, Procurement, Production, Maintenance and Engineering, Logistics and Materials Management, Information Systems, Performance Feedback and Management. Previous years’ award winners include Qatar Fuel (Qatar), Bharat Petroleum Corporation Limited (India), and FMC Kongsberg Subsea (Norway).
We are pleased to announce that the winners of the 2010 awards are:
Shell. Shell won based on its high-performing standardization program, which allowed it to reduce purchase prices by 30% for valves, cut variety by 50%, through use of its extensive Materials and Equipment Standards and Code (MESC) catalog. The catalog, which is based on ISO and IEC standards to ensure interoperability, integrates 370 Design and Engineering Practices (DEPs) that standardize tools and facilities, reducing recurring engineering and design work and consolidating spend on standard items. In addition to reducing purchase cost, the practice also reduces delays due to supplier confusion and costs related to unnecessary rework. Continuous feedback from users and participation from external standards bodies keeps specifications up to date. Shell more than doubled the number of DEPS between 2000 and 2010, and is aiming for a DEP age of 3.5 years. Click here for the press release.
Chevron. Chevron Corporation (USA) won for its effective in extending its internal Lean Six Sigma techniques to its suppliers. The first pilot project in 1999 reduced operating costs at a California water treatment plant by 30%. Lean Sigma, which officially started as a grass roots initiative in year 2000, validated financial benefit of $250 million in 2008, $400 million in 2009 and is projected to exceed $500m in 2010. Hundreds of projects across the US, UK, Angola, and Indonesia contributed to the achievement. An internal consulting group led by Stephen Turnipseed helps facilitate the Chevron businesses in starting and maturing their programs. As the SBU programs mature, Chevron actively engages its suppliers and contractors in improvement projects and in development of similar continuous improvement programs. Click here for the press release.
Baker Hughes. Baker Hughes won the award based on its supply chain transformation strategy and year-one achievements: the group has publicly declared $100m in volume adjusted cost reduction per year for the next three years. The roots of the savings trace to supplier categorization and rationalization, strategic sourcing designed to shorten the chain and dramatic improvements in lean manufacturing in their “go-forward” manufacturing facilities. The company created a global supply chain and manufacturing organization in April, 2009, and appointed Arthur Soucy, formerly Pratt & Whitney’s VP of Global Supply Chain, to run it. Click here for the press release.
The awards were conferred at the annual retreat of the OFS Portal in Houston. Click here for a photo.
Congratulations to the winners!
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