How data analytics can strengthen supply chain performance | EY

The supply chain function is a critical component of any large manufacturing or industrial company.That’s especially true in oil and gas, where operations may be spread out geographically with the need to rapidly deploy high-dollar services, materials and equipment — often specialty and high-spec in nature — to support well development and production activities, and also provide adequate materials to support ongoing maintenance and reliability for production.

To start this project with a strong foundation, the client and EY team first had to identify the appropriate data availability from multiple systems, extract the data based on EY extract templates — built from the team’s deep technical and industry knowledge — and validate the data completeness and understanding.

Then, using the EY Supply Chain Intelligence Platform and proprietary SmartMaps™ technology, the team ingested this high-volume information to include all third-party spend and all consumption transactions. Ultimately, SmartMaps™ analyzed nearly 17,000 unique line-item descriptions, around 600 unique suppliers, more than 400 different categories of spend, 20 different buying channels and over 12,000 material movements in a short time frame.

The EY team then created a baseline of both spend and materials management activity that highlighted opportunities to close master data gaps, improve cost efficiency and organizational performance in process execution, and identify automation through digitalization options.

As part of the project, multiple complex data files were consolidated into a master dashboard for analysis and modeling to include overall spend analysis, supplier insights, category and material segmentation, and transactional value analysis. This accompanying dashboard enabled the company’s authorized supply chain, operations and accounting employees to clarify the “big picture” of what opportunities are available and why they are so important to their business.   

“This project demonstrated how managing supply chain spend appropriately — based on accurate data — can save significant dollars, reduce expensive downtime in the field and limit the amount of capital tied up in unused inventory,” said Robbie Thompson, Executive Director, Energy Supply & Operations. “We found substantial savings where they’d not historically looked — allowing for strategic deployment of capital elsewhere in the organization. It also showed how the company could improve lead times on key purchases and enhance spending and purchasing forecasts.”