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TCS proprietary and confidential
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 Creating world class
downstream assets
Challenges and Strategies

Joseph Martin

Beyond the ObviousTM

TCS proprietary and confidential

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Agenda
™ India a petroleum export hub : Perspectives

™ Downstream challenges in enabling the hub

™ Best in class business ecosystems

™ Strategies to create a globally competitive ecosystem

™ Leveraging ecosystem by individual firms

™ Discussions

TCS proprietary and confidential

3
 Indian petroleum hub : Perspectives

Attaining global standards in

Drives ROCE up by
Capability to Capability to Capability to
Minimizing operating
Add capacity Operate capacity Maintain capacity Costs and Optimizing
Refining Vs Consumption
India and Singapore
Capital investment

3000

2500
Collective capability of
This “business ecosystem”
2000
To add, operate and
Thousand barrels

maintain
1500

1000
EPC Suppliers

500

O&M
0 OEMs
firms
65

67

69

71

73

75

77

79

81

83

85

87

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01

03
19

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20

Year

TCS proprietary and confidential

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 Indian Petroleum hub : Perspectives

Meeting global

Quality
Quality
Maximize requirements
Performance
With
Minimum
resources
Continuously improving
Optimization Globally competitive Cost
Business ecosystem

Globally
competitive cost
Agility structure
Ability to
Respond to
Change quickly

TCS proprietary and confidential

5
Agenda
™ India a petroleum export hub : Perspectives

™ Downstream challenges in enabling the hub

™ Best in class business ecosystems

™ Strategies to create a globally competitive ecosystem

™ Leveraging ecosystem by individual firms

™ Discussions

TCS proprietary and confidential

6
 Downstream challenges in enabling the hub

Multiple Disconnected
agencies processes Toyota business
Ecosystem is one of
Diverse The best in the world
Lack of
Information
standardization
systems

Service
EPC Suppliers OEMs
providers

Planning Design Procurement Construction Operation Maintenance

Technology Service O&M

OEMs
providers providers firms

US$ 15.8 billion is the annual cost

Of Interoperability in US Capital industry
NIST, US Department of Commerce
October 2004

TCS proprietary and confidential

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Agenda
™ India a petroleum export hub : Perspectives

™ Downstream challenges in enabling the hub

™ Best in class business ecosystems

™ Strategies to create a globally competitive ecosystem

™ Leveraging ecosystem by individual firms

™ Discussions

TCS proprietary and confidential

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 Best in class business ecosystems

Collective Withstand Collective Pervasive

Advantage Market
Microsoft

Intellectual Use of simple

For its partners discontinuity property technology

Linux
Platform
Disproportionate Visibility of Voluntary
Leveraged by its
influence work initiation
partners

Significant cost Influence on

Value sharing Common work
Advantage for Partner
Among partners
Walmart

retailers discipline
processes
Toyota

Procurement Lean methods

Ensures High commitment
System leveraged To minimize waste
Collective growth
By its suppliers

TCS proprietary and confidential

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 What makes the difference

• The big three US automakers has made the annual cost reduction targets for the products
they purchase. To realize those targets they will do anything. They have unleashed a reign
of terror, and it gets worsen every year You cant trust anyone in those companies.
Director, interior systems supplier to Ford, GM and Chrysler, October 1999

• Honda is a demanding customer. But it is loyal to us. American automakers have us work on
drawings, ask other suppliers to bid on them, and give the job to the lowest bidder. Honda
never does that.
CEO, Industrial fasteners supplier to Ford, GM, Chrysler and Honda, April 2002

• In my opinion, Ford seems to send their people to ‘hate school’ so that they will learn how to
hate suppliers. The company is extremely confrontational. After dealing with Ford, I decided
not to buy its cars.
Senior executive, Supplier to Ford, October 2002

• Toyota helped us dramatically improve our production system. We started making one
component and as we improved, Toyota rewarded us with orders for more components.
Toyota is our best customer
Senior executive, Supplier to Ford, GM, Chrysler and Toyota, July 2001

Excerpts from Harvard Business Review article “Building deep supplier relationships”, December 2004

TCS proprietary and confidential

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Agenda
™ India a petroleum export hub : Perspectives

™ Downstream challenges in enabling the hub

™ Best in class business ecosystems

™ Strategies for a globally competitive ecosystem

™ Leveraging ecosystem by individual firms

™ Discussions

TCS proprietary and confidential

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 Strategies for a globally competitive ecosystem

Stages
Downstream hub growth
Collaboration Standardization Commitment

Oil firms
Promotion OEMs
Service
providers Process
Enablement Knowledge
management
management

Technology EPC firms

management

Involvement Logistics
players
Technology
firms
Sustaining
Suppliers

Improving
Critical success factors
Leveraging Common Voluntary
Continuous
Current Intellectual Value driven
communication
knowledge property involvement

TCS proprietary and confidential

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 Global standardization efforts
Materials Engineering Procurement Construction Operation Maintenance

ISA 95

MIMOSA
Equipment

PIDX

API 690
Personnel

ISO 15926
Plans

API 610

OPC
Actual

API 689

Adopted from MIMOSA

TCS proprietary and confidential

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Agenda
™ India a petroleum export hub : Perspectives

™ Downstream challenges in enabling the hub

™ Best in class business ecosystems

™ Strategies to create a globally competitive ecosystem

™ Leveraging ecosystem by individual firms

™ Discussions

TCS proprietary and confidential

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 Leveraging ecosystem by individual firms

Leadership to inspire and lead the learning workforce

Progressive
Robust human performance management systems Fuel quality
Supplier collaboration strategies

Continuous improvement leveraging process and technology

Customer facing strategy

New business
models

Performance matrices to control and monitor processes Stress on

sustainability
Business process platform for flexibility and reliability

Collaborative processes driving transparent decisions Increasing

convenience

Assuring
Tools to provide intelligent analytics
Q/Q
Rigorous models to leverage additional information
Changing demand
Smart sensors providing more information pattern

TCS proprietary and confidential

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 Thank You

TCS proprietary and confidential

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