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Vopak is a world player in the field of tank storage and distribution. The competitive market of Vopak calls for better insight in results. Partly for this reason the division chemics EMEA started defining performance indicators. After a “live”- test of software applications Bizzscore was chosen. The pilot was concluded successfully in May 2004. The system is now implemented for division management, staff and local MT’s. Forecasting, benchmarking and improved insight in the business model are mentioned as important benefits. End users experience Bizzscore as very intuitive and user friendly.
The Organization
With a history going back almost four centuries, Vopak is the world’s largest provider of conditioned storage facilities for bulk liquids. Whether it’s liquid or gaseous chemicals, oil products, petrochemicals, biofuels, vegetable oils or Liquefied Natural Gas (LNG), Vopak offers complete storage and transshipment solutions at 80 terminals in 32 countries, covering and connecting the world’s major shipping lanes.
Vopak offers more storage capacity than any other independent tank terminal operator in the world. The division Chemics EMEA consists of 21 terminals with a joint capacity of 3.8 million m3, 18 are located in Europe, two in the Middle East and one in South Africa. The main terminal for the storage and handling of vegetable oils oleachemicals is situated in Rotterdam and has a capacity of 425,000 m3. In Vlissingen Vopak exploits the largest terminal for LPG and chemical gasses in North-West Europe, with a capacity of 130,000 m3.
The Challenge
During the last decennia, the market for tank storage has become more competitive. So a timely and accurate insight into the results is paramount in this market. Therefore, Vopak wanted to implement an Activity Based Costing (ABC) project. The main objective was to analyze why and how clients or products were profitable. In order to make such an analysis possible, insight in Key Performance Indicators was necessary.
And when end of year results over 2003 proved to be disappointing, the need for information about Key Performance indicators came even more to the fore. It was made clear that defining and predicting the factors that influence the results had become of the utmost importance. Monitoring the Key Performance Indicators had to support this and prevent any further surprises.
The Pilot
By the end of 2003 the management of the division chemical EMEA decided to start this KPI-project. On the basis of interviews that were taken and workshops held with managers, a set of KPI’s was developed. The first two months of 2004 a software selection project took place. Two packages, including Bizzscore of EFM Software, were eventually tested “live” by running existing reports. Bizzscore came out best. In February 2004 Vopak decided to purchase Bizzscore.
The main aim of the pilot was to get experience on management level with Bizzscore and also to see if the chosen set of KPI’s could satisfy the targets of the project. After a training had taken place at the Botlek location of Vopak, a “go” decision was made. On the basis of the first KPI-set the history of 2003 was imported. Next, the first trimester of 2004 was monitored “live”. Bizzscore calculated monthly outcomes. The main condition was that all data should be imported.
The official presentation of the results took place in May 2004. It was then decided to further implement Bizzscore.
The Implementation
The KPI-system has been implemented by division management and staff, in the Benelux and abroad per MT. Within this user group the software is accessible for everyone. The system contains 18 basis scorecards and 8 consolidated scorecards. Per scorecard 44 KPI’s are measured, subdivided in 12 financial KPI’s, 5 indicators with regards to the clients, 20 net numbers about the operational processes and 7 performance figures referring to learning and growth.
At the head office, once a month 2 large files are imported in one go which contain all information for all locations. One contains data which are downloaded from Hyperion as dump; the other is an MS Excel file with operational data. The Bizzscore functionality “Name recognition” is used, by which Bizzscore automatically recognizes Hyperion codes. This monthly process takes 10 to 15 minutes. The checks on the figures take 15 minutes every month.
Based on the monthly outcomes presentations in the MT take place, where striking items are explicitly discussed. In consultation with head office, the KPI’s are elaborated with local MT’s.
The Business benefits
An important benefit that has been realized is the possibility to benchmark, especially between the terminals, because 15 of the 18 scorecards are comparable. In this way, a clear insight is gained in the factors which determine why one division is more profitable than the other. Furthermore, the business model of Vopak Chemics is better understood by the management.
The most important added value of Bizzscore is the forecasting. For instance, in Finland important seasonal patterns were discovered which had been unnoticed before because Bizzscore’s trend analyses give more insight than analyses on source data.
“The predictable element has increased considerably”, says Frank van Vliet, controller at Vopak. He also speaks of the greater understanding of the business rules and the better understanding of mutual relations between KPI’s. “Bizzscore offers the possibility to use the KPI’s as a true steering instrument. The software is experienced as very accessible and intuitive by its end users. The drill-down functionality of Bizzscore is thought to be very distinct”.
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