161 Start With Goals Valero rolled out its dashboard in early 2008 at the behest of COO Marcogliese. He had launched a Commitment to Excellence program aimed at improving performance, and he wanted to see real-time data related to plant and equipment reliability, inventory management, safety, and energy consumption. Whether driven by Total Quality Management (TQM) programs, Balanced Scorecards, or another methodology (more on those later), information-driven companies tend to succeed by establishing clear goals and expectations that are aligned from the top of the organization down to departments and individual employees. When results start coming up short, executives can manage the exceptions along the way rather than hoping for the best and reacting to surprises at the end of a quarter. Valero's goals and measures were inspired by Solomon benchmark performance studies well known in the oil and gas industry. Real-time performance data is compared against daily and monthly targets, and there are executive-level, refinery-level, and even individual system-operator-level dashboard views. It's rare among business intelligence deployments to get fresh data every five minutes, but Valero has tapped directly into "process historian" systems at each plant in a six-month deployment of SAP's Manufacturing Integration and Intelligence application. The data is aggregated and displayed using SAP BusinessObjects Xcelsius software. A major focus of Valero's Commitment to Excellence program is reducing energy consumption, so the company is rolling out separate dashboards that show detailed statistics on power consumption by unit and plant. "Based on the data, managers can share best practices and make changes in operations to reduce energy consumption while maintaining production levels," CIO Zesch explains. Estimated savings to date: $140 million per year for the seven plants where the dashboards are in use, with expected total savings of $230 million per year once the dashboards are rolled out at all 16 refineries. The successes have created dashboard-envy within Valero, so IT is working on similar dashboard programs for sales and marketing as well as the strategic sourcing unit. Focus On The Right Measures The terms "scorecard" and "dashboard" are often used interchangeably, but there's an important distinction. Scorecards are all about tracking against defined metrics, and most scorecards are attached to a methodology, such as the Balanced Scorecard or TQM, says Mychelle Mollot, VP of worldwide marketing, analytics, and performance management at IBM. "Top executives have actually laid out a map for where they want to drive the business, and they've created metrics that will drive the behavior that will get them there," Mollot says.
Villanova School of Business 2009 Media Report