Proceedings of the 2012 9th International Pipeline Conference IPC2012 September 24-28, 2012, Calgary, Alberta, Canada

IPC2012-90595

SOUTHERN PIPELINES STRATEGIC PLAN MANAGEMENT TOOLS

Eduardo Bomfim Boszczowski Petrobras Transporte SA - TRANSPETRO So Francisco do Sul, SC, Brazil Gabriel Jos de Castro Santos Silva Petrobras Transporte SA - TRANSPETRO So Francisco do Sul, SC, Brazil

Kleber Vinicius da Cruz Petrobras Transporte SA - TRANSPETRO So Francisco do Sul, SC, Brazil

ABSTRACT The Petrobras Transporte SA Strategic Plan (SP) is an instrument that contains the strategic positioning of the company and aims at guiding the management and action plan in the achievement of the corporate goals. Apart from that, the SP explains the portfolio of investment projects by segment and business area. Every year since 2009, the Terminals and Pipelines Board of Directors have allocated the strategic objectives under their responsibility in order to ensure the alignment of the strategic planning with the operational activities of the company. For this end the strategic objectives are distributed between the Pipeline Executive Management and the Marine Terminals Executive Management. This division allows for the assignment of responsibilities in a structured way throughout the organization, this way setting up the Tactical Plan of the Business Units. To achieve the goals, the evolution of the Tactical Plan of the Pipelines Executive Management is monitored through regular meetings with the Regional Managements as well as through diversions, potential difficulties and corrective and preventive actions. Besides regular meetings, several instruments have been implemented for effective monitoring of the Tactical Plan, e.g. a web based platform for sharing information, video conferences, performance indicators and other tools that enable the management of the actions. This paper aims to describe best practices applied to the purposes and goals of the Pipeline Tactical Plan under the management of the Southern Pipelines Management, describing their Benefits to the company in a long-term horizon under conditions of uncertainty of the international energy market.

DESCRIPTION The Business and Strategic Planning are composed by several instruments, which contain the strategic position of Petrobras and Transpetro. These Plans aim to guide not only the management and action plan but also to explain the portfolio of investment projects by segment and business area. Since 2001, the executive manager of strategy and development business, linked to the presidency of Petrobras, proposes international and national scenarios of macroenvironment and of the energy industry to subsidize the Strategic and Business Plan from all companies of the Petrobras System, including Transpetro. It evaluates the main tendencies of the energy area, by prospecting the fuel, natural gas and biofuel markets. It also analyses the behavior and positioning of competitors. Petrobras uses the Balanced Scorecard (BSC) as a methodology to assess the strategic performance. Its product, the Strategic Performance Panel, composed of the strategic map and its objectives, indicators with their strategic goals and initiatives. Petrobras evaluates systematically the strategy implementation performance over the Business Plans time horizon (5 years). This analysis is done by four perspectives (financial, market, internal processes and learning and growth). The formulation of Transpetro strategies occurs jointly with the Petrobras Supply Board of Directors, which, in turns, takes part in the Board of Directors of Transpetro. The Company's General Management of Planning and Business Management of Transpetro (GEPLAN) receives information from the holding company and together with the Board of Directors assesses the competitive environment,

Copyright 2012 by ASME

business, the planned investments, markets, customers, the logistics and supply chain. This information is reviewed annually to edition of Strategic Planning of Transpetro by segments business. These events are redirected actions to achieve the main goals of the company. In the Strategic Planning are analyzed political-economicsocial scenarios. This process is executed by revising the Company's Strategic Planning and checking political, economic and social scenarios, which are the most important aspects of planning. In the review, the critical points are analyzed and their impacts are reviewed. The opportunities in the transportation market, in various modes of transportation, are also analyzed by market research. After analyzing the external environment, the Committee for Planning and Strategies (CPS) assesses all necessary resources to reach its objectives. It identifies internal environment strengths and weaknesses through information provided by the committee members. With the Strategic Plan final approval by the Board of Directors, the CPS develops strategic initiatives aiming the achievement of the Strategic Objectives. One or more board of Directors are responsible for the implementation of these initiatives. Guardians are appointed for each strategic initiative, and, according to the portfolio of each Board, the financial resources are allocated, resulting in the Transpetro Investment Plan. The investment portfolio consists of the initiatives of all the Boards. In a more detailed way, the Strategic Plan (SP) is an instrument that contains the company's strategic positioning. It is represented by a set of great choices of businesses and markets, where the company will act, and directs the present management and build its future in a long time horizon under conditions of uncertainty. The Strategic Plan contains: Mission, Vision, Scenarios, Assumptions, Corporate Strategy; Business Strategies, Business Drivers; Strategic Objectives, Indicators and Goals, Strategic Projects. As dissemination and promotion of the company's strategic plan on all levels are prepared summary tables with the company's strategic goals associated with the DTOs Tactical Plan. Using the BSC methodology, the objectives are divided into four perspectives, as shown in the figure below.

Perspectives Financial

Objectives Increase revenue through new business Grow in a sustainable way, ensuring the profitability and value Ensure levels of excellence in productivity
Develop new customers aligned to the Petrobras System interests Consolidate itself as a carrier of the Petrobras

Market

Internal Process

Be recognized as a social and environmental responsible company Offer to the client benefits excellence operation of transport and operational flexibility Meeting the needs of Petrobras in developing transport solutions. Expand existing business aligned to the interests of Petrobras System Act as an integrated transport solution Ensuring excellence in management, operation and QHSE Optimize the use of financial resources

learning and growth

Increase employee satisfaction and commitment of the company Promote a culture of innovation in technology, management and processes Attract, develop and retain the workforce for current and future challenges Strengthen knowledge management

Consolidate the culture of QHSE

Fig. 1: Perspectives and Objectives The Business Plan is derived from the Strategic Plan and it is an instrument of managerial character that represents an action plan for the next five years focusing on business and markets prioritized by the companys corporate and business strategies. The Business Plan contains goals, in line with the companys indicator panel of corporate performance, as well as with the investment portfolio of ventures by segment and business area for a period of 5 years. This portfolio of projects will support the achievement of goals in many ways, like as, the correct allocation of the necessary resource investments, the required and quantified financial conditions by return indicators, solvency and create value. All conditions will be based on macroeconomic premise, market and price established for the planning horizon. In Transpetro, The Company's General Management of Planning and Business Management of Transpetro (GEPLAN), coordinates several Working Groups (WG) composed of members of the four sectors of the company, Tranpetros Administration of Terminals and Pipelines (DTO), Tranpetros Administration of Natural Gas (DGN), Tranpetros Administration of Finance and Administration (DFA) and Tranpetros Administration of Maritime Terminals (DTM), and also the support areas of Engineering, Information Technology and SMES, to study the generated worksheets SWOT.. These groups are responsible for reviewing the Business Plan of Transpetro sectors every year.

Copyright 2012 by ASME

The WG proposals are reviewed and voted in the BoD meeting, with the presence of the CEO. If approved, this proposal will be evaluated by the Petrobras Board of Directors, composed of the President of Petrobras, representatives of the Boards of Supply, Exploration &Production, Gas & Energy and a representative of the Ministry of Planning. As approved, the proposal is formalized as the Transpetros Business Plan. To ensure the alignment of strategic planning with the operational actions of the company, annually since 2009, the DTO - Tranpetros Administration of Terminals and Pipelines deploys strategic objectives under his responsibility in strategic initiatives between the Executive Managers (GE) of Pipeline (OIL), and the Executive Manager of Marine Terminals (TA). In a meeting with the DTO and the GE's, are established the deployed macro-actions of the initiatives. This process refined the previously practiced by the Executive Manager, because the previously strategic objectives were defined by the Executive Manager. At annual meetings between GE's and Regional Managers, the macro-actions are deployed into the actions of the Tactical Plan of the Marine Terminal and Oil. The goals of realization of actions are defined for each Executive area in conjunction with their Regional Managers. The action priorities are defined in three levels. This prioritization meets the criteria established in the Strategic Plan and is based on deadline for compliance. These actions incorporate the accomplishment of investment projects portfolio by segment, business area and management projects that lead the company to achieve its goals. With the Focus to support the operational units are created the Tactical Plan of the support sectors, for example, the "Services and Engineering", "Human Resources", Information Technology and others. s. All those Tactical Plan are derived from Tactical Plan of the operational areas (DTO, DTM and DGN). Meetings are held regularly to monitor the Tactical Plan for Executive Managers (GE) with the analysis of the problems and potential difficulties impeding the completion of the strategies goals. The SIGER Sistema de Gesto por Resultados (Management System by Results) it is our main corporative tool to monitoring and control the realization of the Tactical Plan. Monthly are fed percentages of realization of the tactical plan, which allows a quickly visualization of the physical advance and also the alerts signal, which are classified as:

Fig. 2: SIGER Petrobras Managing Tool

Fig. 3: SIGER Petrobras Managing Tool

to - 5% 5% to - 10%

above - 10% As an example follows the SIGER tool and a graph of physical realization of the action Develop and implement an implementation plan of the RCM (Reliability Centered Maintenance) on critical systems.

Copyright 2012 by ASME

Fig. 4: Example follow-up of physical action in SIGER Another important tool in the process of action planning tactics is the use of sheets to describe and control a detailed stage of completion, a clear visualization of the physical progress and monthly rates of achievement goals and cumulative actions. CONCLUSIONS The follow-up of the deployed marks is done trough alerts flags deviations, which allow the implementation of prevent and corrective actions for deviation of correlation. So the Tactical Plan becomes the main vector for identification of opportunities of investments. However, the need for improving identification of the operating company base is very present. As described above, operational areas, the experience and expertise of professionals in the company lead to identification of potential projects that contribute to the company to achieve strategic objectives. NOMENCLATURE SP: Strategic Plan. GEPLAN: General Management of Planning and Business Management BSC: Balanced Scorecard CPS: Committee on Planning and Strategies. GEPLAN: Company's Planning and Business Management of Transpetro. DTO: Tranpetros Administration of Terminals and Pipelines. DGN: Tranpetros Administration of Natural Gas DFA: Tranpetros Administration of Finacial and Administration. DTM: Tranpetros Administration of Maritime Terminals. EM: Executive Manager. TRANSPETRO: The largest shipbuilder of Latin America and the main Brazilian logistics and fuel transportation company . Petrobras Transporte S.A. Transpetro works with transportation and storage activities of oil and byproducts, ethanol, biofuels and natural gas. REFERENCES SIGER Tool of Petrobras Strategic Plan of Petrobras

Copyright 2012 by ASME