Adulterated fuel is a big business in India. It’s so big, it’s worth killing for.
In November 2005, S. Manjunath, a sales manager for the Indian Oil Corporation, was murdered by the fuel mafia because he had detected and shut down gas stations selling adulterated fuel in Lakhimpur Kheri in Uttar Pradesh.
Thinning down fuel is not good for anyone, certainly not for consumers or the oil companies. But this did not stop the fuel mafia.
In 2006, the situation got bad enough for the government to step in and lay down the law: it set deadlines for oil companies to piece together a mechanism to create fuel markers, have more surprise checks at petrol pumps, use global tracking to monitor petrol trucks, and increase sample testing.
Because of the number of times that gas changes hands on its way to the consumer, testing fuel samples is among the most obvious and direct methods of ensuring quality. India’s third largest oil company –Bharat Petroleum Corporation Ltd. (BPCL), has such a program, too.
The organization takes its sample testing seriously. It has a large operation dedicated to quality assurance – 3,000 employees big.
But like all large operations, BPCL’s quality control initiative was riddled with inefficiency.
Efficiency Breakdown
BPCL products, like fuel and lubes, make four pit stops as they travel through the distribution channel. From BPCL’s refineries, products move to manufacturing plants and are then transported to depots via pipelines or trucks. From the depots, products are moved to filling stations or distributors of lubes.
In order to ensure quality, samples of BPCL’s products have to be tested at each of the four stops by the Technical Service Department. With over 120 depots and 8,000 retail outlets, the department has a huge job on its hands.
“As per operating processes, practices and guidelines, product samples are collected from retail outlets, oil depots, tankers, and state and government agencies. Sample collections also originate from customer complaints. Apart from this, we do random sampling in cases of leaks, accidents, confiscation in transit,” says M.D. Agrawal, deputy GM (IS), BPCL.
To create a mechanism that could handle this load, BPCL did what most companies would do if they wanted to speed up the process of sampling: they created more test labs. At last count, BPCL had 23 testing centers and 22 mobile labs spread across the country.
But throwing more labs at the problem didn’t send it away. It still took about plenty of time to turnaround a sample.
“External customer samples — that normally came to us with a note from a local sales officer — would take 25-30 days [to test]. Sometimes we would have to resend the reports because of various inefficiencies,” says Subramanian R, deputy manager, QC, at BPCL’s Shivdi office in Mumbai.
The problem was the volume of data being generated at the QC headquarters was swamping the manual system that BPCL had set up.
Test results, customer complaints, and the tracking of samples were all handled by people — by people who took vacations, who left office at 6 p.m., and who were human enough to be prone to making mistakes.
Chasing down test results that were sent via email and fax (in the form of worksheets) made the process even more cumbersome. Added to this was the pressure of deadlines.
The organization had thought of a solution — but it had only been used at BPCL’s refineries. It came in the form of a software solution from US-based Thermo Fisher.
The refineries used a Laboratory Information Management System (LIMS) to test products at intermediate stages of production. “LIMS is very high-end and complex. It’s not suitable for enterprisewide application,” says Dr. Narasimham PVSL, senior manager, QC. “It would not solve our problem.”
Besides, the Thermo Fisher LIMS cost more than Rs. 2 crore (Can$500,000) for eight user licenses. To create the efficiencies they were looking for, BPCL required over 1,000 users to have access to the system. What they needed was a system similar to LIMS to automate various processes and integrate all their labs onto an online collaboration system.
It would also be required to manage information, test results and the quality at the labs. And it could not be expensive.”It was a challenge for the IT department to conceptualize and provide a system which would meet benchmarks for both functionality and value. We had to think of the economics,” says Agrawal.
Backseat Driving
Agrawal and his team started attacking the problem with some serious shovel work: they looked hard for similar deployments in India. Much market research helped them locate a few in Hyderabad, but their sizes were no match with the 150,000 samples that BPCL’s labs churned out every year.
They could not find a reference site that had integrated a multi-purpose laboratory information systems into a single solution. They would have to conceptualize their own system — a tall order. And it would have to be done while designing the system and planning for challenges that integration with existing facilities would pose.
The IT department evaluated various solutions for functionality, platform compliance, performance over WAN, scalability and robustness.
After thoroughly scrutinizing solutions from multiple vendors, Agrawal identified the best fit for their needs and Hyderabad-based Caliber Technologies was identified as the technology partner. BPCL’s IT team had crossed the first hurdle; but it was one they knew they had control over.
Because of the large business impact of the solution they were trying to create, the IT team knew that after this point the project would belong to many departments, a recipe for disaster.
So, they appointed TCS as project manager and responsibilities were handed out. IT would be the key driver for the LIMS project, which meant that project drafts and ‘activity initiation’ were the responsibility of Agrawal and his team.
They were also responsible for vetting other vendors, pinpointing necessary interfaces and fixing integration challenges. In addition, database administration and feasibility studies on customer complaint modules were given to the IT team.
BPCL’s QC department, however, were designated process owners. They would identify and isolate the applications that would run on LIMS. The refinery’s IS team, which already had experience with the Thermo Fisher LIMS, was made project co-coordinator. They would also play an important role in the procurement of the solution and providing interface support.
The deployment, it was figured out early, would need co-ordination between almost all the operations of sales. So a retail team also provided with data for budgeting the solution. The ERP and corporate IT teams were made available for support with interfacing with other existing systems like mail servers.
Work on the project began September of 2006. The project kicked off with the objective of synchronizing the labs of BPCL at enterprise level. A cross-functional team was formed with members from each of the stakeholder groups, users and IT. A pilot was commissioned by in December of 2006 and was completed in three months.
The system was built around three basic but key modules: the sample manager, the resource manager and the system manager. These three really support the workflow of the laboratories right from the time when samples are registered to when test reports are released.
They also help ease communication when the Technical Services department redresses complaints from customers.
To stay in line with the international ISO/IEC 17025 requirements, it was also important to use bar codes on samples.
These technical challenges, however, were only the beginning.
Planned Ride
As with any implementation of this size, the project team faced change management problems. “There will always be issues,” says Narasimham. “Fortunately, we already had experience with this while implementing SAP earlier.
I was the change management coach on that project, so we anticipated most problems and ensured that the preparatory ground was done in advance. Sometimes we needed to push — where we needed, we did. But once people started seeing the benefit of the system, the take-on was much faster.”
However, pushing was not a method BPCL could use with its clients. For the project to take off, it was vital to get external customers to register on the LIMS.
This is where both internal and external customers faced a similar challenge: an early version of the system required them to register information on both SAP and LIMS — especially for product batch tests of Lubes. The double work was creating pushback and BPCL’s IT team solved this by deploying a smooth seamless LIMS-SAP interface — gaining much standing.
Many parts of the system also faced connectivity problems, but precious little could be done about it. “The problem is some of the labs are connected on low speed VSAT and some via VPN. The network is also on high speed LAN.
We also use lease lines. We have to provide seamless performance even with so much variation on the network. The software needed testing to see if while operating in real time, it could meet our expectations,” says Agrawal.
Since this was an enterprise level deployment, based on ASP.NET, it was also a challenge to ensure it was well maintained and had minimum downtime in a worst-case scenario. It also needed to respond to centralized control. This challenge was met by running the system on an intranet-based platform.
The integration with diverse systems that already existed, like SAP, Active Directory, etcetera, could also raise a challenge. Other problems that could loom up were that of the humongous volumes of sample and testing data, a long list of testing procedures, and standardizing various processes.
In addition, there was the added task of tracking test history to assure prompt responses expected for customer queries. This was a huge deployment, and unless handled pragmatically, crosscurrents could create more trouble.
Fortunately, none of these challenges posed a threat to the deployment and Agrawal’s team with Narsimham’s department, assisted by TCS and Caliber’s project team implemented LIMS successfully.
Speed For Sure
The LIMS implementation met all the expectations that the QC and sales quality control could have thought of. In addition to providing the standard benefits that it was designed to provide, it improved communication between labs, between labs and the sales field staff, between labs, depots and retail staff, between labs and customers, and between labs and refineries.
It has also helped drastically reduce test cycle and customer responses, from 25 days to less than half of that. The system allowed for easily-accessible database archives of sample data, online customer redressal, and so on.
It built customer confidence not only externally but also internally, among the business units of BPCL that use the solution. And it only cost Rs 70 lakh (around $175,000)
“The status of a sample is visible to the user, he knows where it is, which means that one big block of communication costs came down drastically. It captures everything in the lab, everything is stored on it, there are no books and procedures required,” says Subramanian.
“With LIMS, customers send us samples and we give reports attached with comments. Customers are much more satisfied,” he says.
Even the data from mobile labs is captured in the system. “The mobile labs are now provided with laptops with VSAT cards. They can register a sample from wherever they are instead of waiting to
come back.”
Subramanian points out that the success of the project had led to business proposals from external agencies interested in outsourcing their lab operations to BPCL.
Meeting quality requirements, which is one of the basic policies of BPCL, was the first goal met. But, the LIMS deployment has definitely given the BPCL business an edge over competition. It has helped the company jump past its rivals by renewing customer confidence. Who said oil stains were impossible to remove?
