©2010 TASC Incorporated
The Future of Global Oil & Gas Supply Chain Logistics
Sense and RespondInventory Management
Evolution of the Logistics Model
The dynamics surrounding the global petroleumsupply chain require adaptive, extendedenterprises that are very fleet-of-foot. This is anera of discontinuous change and all the old(often linear) rules no longer apply-rather, allthe old process assumptions should be reassessed.Historically, inventory was stocked with an "x"day supply mentality. The construct evolvedover time and has its roots in informationinventory management systems that werelaborious and slow. This concept was succeededby just-in-time (JIT) inventory managementwhich works well, except when it does not.The sense and respond (SR) supply chainprocess is a paradigm shift from JIT processesthat attempt to predict future demand. SRidentifies changing requirements and businesschallenges as they occur, quickly adapting andresponding before further change morphs thenewly created opportunity once again.Business failures, regional political and/or civilunrest requires fast and adaptive behavior toinsure there are no disruptions in production.In today's environment, JIT might not be assuccessful as it has been over the last two decades.
Sense and Respond
Logistics models are adapting to changingenvironments. This is the essence of the SR-aresponsive, robust systemic approach that isdistributed across global operations. Today,the current mature level of sophisticated andpowerful information and communicationstechnologies enable the implementation of theSR business model.The advent of SR logistics solutions continuesthe march towards the Lean Energy businessmodel, which is similar to the manufacturingprocesses used by successful automobile andaerospace manufacturers. The SR logisticssolution integrates three primary enablingtechnologies: material and equipment identification,fit-for-purpose global communications, anda single instance of the inventory data store.
Implementing the Solution
Items in the supply chain must be identified.Historically, retailers and others have usedbarcodes and lately, inexpensive radiofrequency identification (RFID) tags have beenattached to more expensive items such aselectronic goods. Secure, fit-for-purposecommunications is readily available throughout