bp - July 2021 by Business Chief Europe

Optimising BP’s workflows with digital transformation IN ASSOCIATION WITH:

DIGITAL REPORT 2021

Optimising bp's workflows with digital transformation

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The energy company’s transformation leaders shed light on harnessing the power of digital for business performance and meeting their sustainability goal

p has set out a new strategy to transform from an International Oil Company to an Integrated Energy Company focused on delivering solutions for customers. This is a major, necessary step in support of the company’s purpose to reimagine energy for people and the planet, and its ambition to become a net zero company by 2050 or sooner and help the world get to net zero. After more than a century defined by oil and gas, bp set out a strategy to become a very different energy company in the next decade. So what does it take for an organisation with a rich heritage to remain ahead of the game today? One of the answers is digital transformation. Nick Wright, bp’s global director of digital and innovation sourcing is a strong advocate of transformation for efficiency. He says the focus for his area of the organisation is sourcing complex or innovative technology deals in support of bp’s strategy. Nick states: “Transformation isn’t just a change in process, for an organisation like bp that has years of legacy systems behind it, it becomes more of a mindset shift. There is a sense of reimagined purpose, given our ntentions to move from traditional oil and gas to clean energy, and to fulfill that purpose, it is important to transform and lead through innovation.”

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Vipin Radhakirshnan , bp’s vice president for digital solutions & transformation, adds: “[This is] a common theme for the entire industry, but bp in particular believes digital transformation efforts are underpinned by the organisation's need and want to reinvent itself.” He further adds that the organisation functions on a ‘transformation as usual’ principle which is essential to keep pace with the everevolving technology landscape and user demands. Vipin is responsible for the full scale of work from transformation strategy to execution. In his role, Vipin oversees the adaptation of digital solutions for finance, customer and procurement processes, which includes key areas like data, insights and analytics, business process management, intelligent automation and enabling solutions. 6

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“ A common theme for the entire industry, but bp in particular is that the efforts put in towards digital transformation are underpinned by the organisation's need and want to reinvent itself” VIPIN RADHAKRISHNAN

VICE PRESIDENT GLOBAL TRANSFORMATION & DIGITAL SOLUTIONS AT bp

VIPIN RADHAKRISHNAN TITLE: VICE PRESIDENT GLOBAL TRANSFORMATION & DIGITAL SOLUTIONS INDUSTRY: OIL & ENERGY LOCATION: UNITED KINGDOM

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This holistic approach to transformation helps different areas of the business in understanding the full scope of the problem and building an infrastructure to solve it. Vipin adds “It is really a combination of enablers that are unique because you have everything from data, process automation and technology solutions enabling transformation strategy and delivery.” The other key factor when it comes to transformation at bp is the approach. According to Vipin, it is a good blend of a top-down and bottom-up approach. “A bottom-up approach simply means tapping into the pain points of the business to get an idea of the problems faced and how they can be transformed,” explains Vipin. “On the other hand, a topdown approach would mean setting

Over the last two decades Vipin Radhakrishnan has lead global roles across the Oil & Energy, CPG and Telecom industries with companies like bp, Diageo and Vodafone focusing on Business Strategy, Digital Transformation, Data Analytics & Enterprise Operations. In his current position as Vice President of Global Transformation and Digital Solutions at bp, he is responsible for business transformation covering transformation strategy, global process ownership and agile delivery of the transformation roadmaps. His business and technology background gives him an edge to align the right digital solutions with the business needs, maximising value to his stakeholders and customers.

bp "pushes boundaries" of procurement with Fairmarkit bp wanted to free up procurement resources to concentrate on value-added procurement activity as well as ensure they were managing their spend and budgets efficiently. To do this, the company wanted to both automate as much of their process as possible and monitor procurement data in real time to identify efficiencies.

The Challenge Procurement at bp is an incredibly large operation. The company’s supply chain spans the globe, incorporating functions as varied as drilling for oil, to constructing wind turbines, to operating retail storefronts. In this environment, the procurement team needs to manage spend ranging from billion-dollar specialist equipment to the receipt rolls in cash registers.

Competitively source every purchase. Automation makes it simpler. Data makes it smarter. Fairmarkit is the intelligent sourcing platform that makes it possible.

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“Sourcing and contract negotiations can be quite a manual process,” says Nicholas Wright, Director, Digital and Innovation at bp who is responsible for the way in which bp approaches the market in the digital and innovation space. “It requires careful attention at every step of the process—from capturing and sending the requirements out to suppliers to have them bid on particular requirements or scope, to the selection of a final vendor and the activities required to on-board them. It's an incredibly time- and resource-intensive process.”

bp not only wanted to free up resources to concentrate on value-added procurement activity, they also wanted to ensure they were making the best use of the digital tools avalaible within the marketplace. To do this, bp wanted to be able to both automate as much of the process as possible, as well as monitor and analyze their procurement data at a granular level.

The solution Wright says Fairmarkit is delivering “a great outcome.” He says the platform automates what used to be a manual process to help bp do things faster, with less people. But for Wright, Fairmarkit’s proposition has served another benefit. “It has pushed the boundaries,” he says. “At bp, it was one of our first significant digital platforms, and it is disrupting the way that we work within procurement; it’s actually made people stand up and realize that we can do things differently. As a team and a company, we’re inspired to go out and look for the next Fairmarkit, whatever that may be, and be more aware and open to disrupting other manual processes.”

The result By working with Fairmarkit to automate processes, bp’s procurement team was able to deliver the same scope automatically that was previously done manually. “We can now do more with less,” says Wright. “Automation and the capture of data makes our platform infinitely smarter than any one person. We are now using real time data to make accurate decisions—more than one single brain can comprehend.” bp procurement team members are also using data collected from previous transactions to make smarter decisions. “For instance, if we’re paying for a certain products and services, we can now see how much other organizations pay for those products and services and evaluate whether we’re getting a competitive price,” says Wright. “To be able to do that in real time—on every single transaction—is a level of transparency that is extremely value-additive. We’re using price history to inform the future.”

NICK WRIGHT TITLE: DIRECTOR, DIGITAL & INNOVATION SOURCING INDUSTRY: OIL & ENERGY LOCATION: UNITED KINGDOM I am an expert in commercialisation, super energised by finding new ways to do things, recognising that tried and tested methods are not always right as our business evolves to its low carbon future. As a leader, I seek to build real depth and breadth of knowledge within my team to support the increasingly complex commercial requirements of our stakeholders. I also strive to create a safe environment which encourages experimentation and innovation within my team and across my relationships. I bring 15 years’ experience and am recognised as an expert both internally and within the marketplace.

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broader business transformation goals and outcomes and looking at processes end-toend so that teams don’t just get stuck at the problem-solving level, but instead get a head start on innovating the business of the future.” Speaking of some of the drivers that led to transformation at bp, a need-based purpose is prevalent. The organisation strives to meet customer needs - both B2B and B2C, attune to the needs of the emerging market while serving bp’s internal ambition of reinventing themselves and finally, adapt to the needs of the customer landscape that is progressively changing. As procurement is a large and collaborationoriented business enabler at bp, their strategy has understandably been driven by transformation.

“ We used to be supplyled, meaning we had a commodity and we would release that to the market and that's our bread and butter. But as we reinvented ourselves and created a more digital organisation, we became demand-led” NICK WRIGHT

DIRECTOR, DIGITAL & INNOVATION SOURCING AT bp

Procurement workflows can be quite cumbersome and require a colossal amount of historical and comparative data that is traditionally manually studied to govern processes. This explains why digital transformation has been crucial to decision-making, where both real-time analytics and historical data is available at hand, thereby reducing the need for manual synthesising of information. bp is in the process of evaluating all our existing procurement vendor engagements as part of a wider procurement transformation initiative. A good example of an improved workflow is the contract negotiation process. Traditionally, procurement officers would spend weeks if not months reviewing documents, negotiating contracts and running tenders, however with the collaboration from digitally native vendors, bp has essentially taken work out of the system and negotiated better deals over time. “The value of working with new suppliers is that it takes work out of the system by delivering a scope that was previously resource intensive, using realtime data to make accurate decisions. Essentially, we’re using our history to determine our future,” adds Nick. To support bp’s customer-centric approach, bp’s procurement and sourcing teams are pivoting to reflect the company’s strategy. This can mean partnering with suppliers to co-develop products to meet new business challenges. With sustainability as a long-term goal, within 10 years, bp aims to have increased its annual low carbon investment 10-fold to around $5 billion a year, building out an integrated portfolio of low carbon technologies, whilst over the same period, bp’s oil and gas production is expected to bp.com

“ It is really a combination of enablers that are quite unique because you have everything from data, process automation and technology solutions enabling transformation strategy and delivery” VIPIN RADHAKRISHNAN

VICE PRESIDENT GLOBAL TRANSFORMATION & DIGITAL SOLUTIONS AT bp

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reduce by at least one million barrels of oil equivalent a day, or 40%, from 2019 levels. Its remaining hydrocarbon portfolio is expected to be more cost and carbon resilient. These are ambitious goals, and to be able to achieve them while keeping everybody’s best interests at heart, the organisation needs to adopt an agile mindset. Long-term goals aside, bp employees are working at constantly reinventing processes and focusing on incremental gains. Coupled with this agile mindset is the need to have a digital outlook – listening to the voice of the customer and improving along the way. And lastly, having a growth mindset both internally and externally, allowing the organisation as well as its partners to grow beyond factors such as cost and time. To this, Nick adds “We used to be supplyled, meaning we had a commodity and we would release that to the market and that's our bread and butter. But as we reinvented ourselves and created a more digital organisation, we became demand-led, listening to the needs of our customers, regions, cities and the wider society.” Nick’s leadership style is also a testament of his commitment to growth, and he nurtures a culture of incremental learning within his department. Nick’s teams are encouraged to learn from experimentation and celebrate their failures, rather than slowly applying tried and tested measures. He believes in providing continuous cycles of feedback and that a minimal viable product that's imperfect is the way to achieve growth and foster innovation.

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