CASE STUDY 5 – PROJECT MANAGEMENT – BP GRANGEMOUTH

THE PROJECT

We worked on site at BP, Grangemouth (now Ineos) on several Information System related projects based in the procurement department when the site was going through considerable change from 2002 onwards. Part of the change was the creation of two separate companies.

The creation of Innovene as a new company was a great success. However, the change in company structure which took place required a lot of hard work to ensure that transition went smoothly. This was especially evident in the procurement department where three significant projects had to be successfully completed to ensure the site could continue to operate without disruption.

Project Mangement

P2P TASKFORCE: PROJECT LEAD

The aims of the Grangemouth Purchase–to-Pay (P2P) taskforce were to review, and change, invoice processing in BP Chemicals to allow Invoice Processing to be undertaken centrally in the most cost effective and efficient manner. The main aim of the taskforce was to ensure that at least 90% of supplier invoices were processed first time without any BP intervention.

In addition, the Grangemouth Taskforce quickly identified a number of other assumptions and aims that were fundamental to the success of the project:

  • The taskforce should aim to compliment the site’s cost agenda. Any processes developed should ensure that site users were controlling their own costs.
  • Strive for 100% processing success (rather than the 90% target set by Project Target). The rate at the start of the project was 20%
  • There had been concern that supplier relationships had been affected because of the transition to SAP. The aim of the project was to quickly ensure that suppliers were paid in a timely manner to re-build the site’s reputation with its suppliers.

VENDOR CLEAN-UP PROJECT

BP were using two inter-linked systems, SAP and Maximo, to control their purchase to pay system. Both systems held separate databases of Vendor details. The databases had been synchronised from the SAP master data.

The situation at Grangemouth was that the vendor data was not synchronised across the two systems. Both databases contained a significant number of records that were inactive. It was estimated that there were 5,500 vendor records in SAP of which only 1,000-1,500 related to live vendors.

Some of the BP Chemicals Vendor records were shared between sites. Therefore, any changes to Vendor records made by Grangemouth had to be co-ordinated between the relevant sites.

The target of the project was to ensure that the Accounts Payable invoice process was an automatic selection. Once the Vendor databases were improved there should be no manual intervention in the “purchase to pay” process. The process for amending Vendor records had to maintain the integrity of both databases on an ongoing basis.

An important outcome for the project was the creation and utilisation of correct effective and efficient processes.

CONTRACT SEPERATION

For Innovene to continue trading with its suppliers the wording of each supplier contract had to be checked, and where necessary changed. This took place under extreme time pressure. Over many years’ contracts had been entered into by different parts of BP and had been owned by different parts of the business. Grangemouth was part of a global programme designed to ensure that this exercise was completed prior to legal separation.

As well as identifying all supplier contracts that Grangemouth complex had entered, the programme had to make the necessary changes to the wording of contracts to ensure that trading could legally continue. This involved discussions with individual suppliers and BP lawyers to agree revised contract wording. In addition, letters were sent to over 2,000 suppliers to ensure that they were aware of new trading arrangements.

THE OUTCOME

Not only did the site complete the programme ahead of a very tight schedule, it was the first site globally to successfully complete the programme.

All three projects were delivered successfully.

CLIENT FEEDBACK

“As a result of your work you are the best performing site globally” Programme manager, IBM

“Well done for a very good piece of work critical to legal separation.” European Procurement Director, Innovene

“This is a stupendous achievement, and a real testament to the professionalism and hard work of your team.” Chemicals Separation – Procurement Team Leader

“Achieving success in all three of these demanding projects required a huge effort from all of the procurement project team. The achievement was even more significant given that the procurement department was undergoing major organisational change at the same time to ensure that separate procurement functions were in place in BP FPS and Innovene at the time of separation.”

 Site – Procurement Team Leader

Project Management

Grangemouth oil refinery complex located on the Firth of Forth in Grangemouth, Scotland.
One of the largest of kind in Europe.

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