Industry Overview

Improving a supply chain performance for the capital intensive oil and gas industry requires a careful balance between opportunity and risk.  Global demand for energy continues to grow, especially in developing countries such as China and India, as the oil and gas industry continues to search for new sources of energy.  Oil & Gas companies and their value chains have faced difficult challenges as they continue to experience unprecedented levels of volatility.   One of the main sources of this is the extreme variability of demand.  It has become increasingly more difficult to forecast demand and as a result, supply chain organizations are under severe pressure.  Balancing the high cost of downtime versus the expense of holding excess or slow moving inventories can be the difference between profit and loss.

Factors that demand attention:

  • Reduced commercial leverage and priority with steel producers due to fragmented material spend.
  • Limited visibility to key cost drivers and associated risk factors such as commodity price & supply volatility.
  • Increased exposure to sub-tier supplier financial instability.
  • Excessive part and material proliferation and excess inventory held throughout the extended value chain.
  • New powertrain designs are re-shaping the value chain, material requirements, and supplier relationships.
  • Some materials & part transformation processes have limited capacities.
  • Lack of confidence in planning process. Sub-tier suppliers are forced to hold excess inventory.
  • Supply related Issues manifest themselves more than one tier away.
Supply Dynamics SDX™ 8.0 Platform Solution Capabilities

  • Extended Bill of Resource Management
  • Supplier Bill of Material Validation & Change Management
  • Consolidation of Material Demand
  • Consolidation of Special Process Demand
  • Multi-Tier Forecasting, Planning & Broadcast
  • Elemental Forecasting
  • Multi-Tier Sourcing & Procurement
  • Material and Material Size Rationalization
  • Supplier Rationalization
  • Price & Supply Risk Management
  • Extended Supply Chain Visualization
Engaging Supply Dynamics: 

We play an integral role from initial client contact through ongoing solution support.  Supply Dynamics works directly with clients or in partnership with leading global service providers.  Our phased value approach and supporting processes deliver benefits at each stage of interaction.

Stages include:

Pre-Sales Activity

  1. Identifying initial strategy & value areas
  2. Develop scope for SDX Opportunity Assessment designed to identify & highlight cost savings and efficiency opportunities.
  3. Plan and conduct SDX Opportunity Assessment (on site).

Solution Configuration

  1. Assembling initial ‘Extended Bill of Resource’ Model.
  2. Part Attribute Characterization.
  3. Load production materials (alloy, grade, specification, form, size, and volumes.)
  4. Load materials, parts and BOM hierarchies in SDX™ 8.0 Platform
  5. Link finished part forecast to production material requirements.
  6. Multi-Tier Sourcing Models (e.g. Directed Buy, Buy-Sell Resale, and others).

Solution Deployment

  1. Deploy ‘Cloud Based’ Instance of SDX™8.0
  2. Provide an interface for stakeholder interaction and validation of information

Ongoing Support & Services

  1. Provide help desk support.
  2. Provide ongoing platform support, maintenance, enhancements and new solution capabilities on product roadmap.
  3. Add new commodity categories and/or sourcing models to SDX 8.0 Platform
  4. Provide Supply Network analyses & reporting as a Service.
Value Drivers

  • Leverage aggregate volume to gain commercial benefit with producer.
  • Eliminate non-value add margin est. > 20 percent (over and above margin on value-added services).
  • Standardize production material forms, sizes and specifications.
  • Proactively expedite the timely purchase and supply of production materials across the extended supply network.
  • Provide forecast of elemental inputs to support financial risk management strategies.
  • Improved forecasting & planning.
  • Ensure continuous supply and capacity to avoid supply interruptions.
  • Recover scrap/revert value.
  • Reduce delivery variances through better coordination.