BUSINESS PROCESS RE-ENGINEERING  AT  HINDUSTAN PETROLEUM Presented by Mr Arun Balahrisgnan HR Round Table organized by ISPe
BUSINESS PROCESS RE-ENGINEERING  AT HPCL <ul><li>OIL INDUSTRY IN 1990's </li></ul><ul><li>STRUCTURE AT HPCL </li></ul><ul>...
OIL INDUSTRY IN 1990's <ul><li>All major products regulated by OCC / Govt. </li></ul><ul><li>Profitability determined by p...
STRUCTURE AT HPCL <ul><li>Organization structure in line with market requirements </li></ul><ul><li>Focus on meeting Govt....
LIBERALISATION - A NEW AWAKENING <ul><li>Severe Foreign Exchange crises in 1990's leads to Liberalisation of the Indian Ec...
CHANGES IN HPCL <ul><li>Govt. sponsored industry reports indicate impending changes in Indian Oil Industry  </li></ul><ul>...
BPR OBJECTIVES <ul><li>Visualise the structure of Indian Oil Industry in the next decade </li></ul><ul><li>Study the possi...
MAJOR CHANGES INITIATED <ul><li>In search of the elusive customer : </li></ul><ul><ul><li>defining the customer </li></ul>...
MAJOR CHANGES INITIATED <ul><li>Re-vitalising processes for faster,  better  decision making : </li></ul><ul><ul><li>Enhan...
MAJOR CHANGES INITIATED <ul><li>Focus on Profitability : </li></ul><ul><ul><li>SBU's become profit centres </li></ul></ul>...
SCENARIO - 2003 <ul><li>Refining sector de-regulated in 1998 </li></ul><ul><li>Marketing de-regulated in 2002 </li></ul><u...
HPCL - 2003 <ul><li>SBU structure in place </li></ul><ul><li>ERP under implementation </li></ul><ul><li>Better focussed to...
Shri M.B. Lal, Chairman, HPCL, receiving the  “ BEST MANAGED COMPANY AWARD ”  (instituted by  “ BUSINESS TODAY ”  &  “ A T...
THANK YOU
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Business Process Re-Engineering at Hindustan Petroleum

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Business Process Re-Engineering at Hindustan Petroleum

  1. 1. BUSINESS PROCESS RE-ENGINEERING AT HINDUSTAN PETROLEUM Presented by Mr Arun Balahrisgnan HR Round Table organized by ISPe
  2. 2. BUSINESS PROCESS RE-ENGINEERING AT HPCL <ul><li>OIL INDUSTRY IN 1990's </li></ul><ul><li>STRUCTURE AT HPCL </li></ul><ul><li>LIBERALISATION - A NEW AWAKENING </li></ul><ul><li>CHANGES IN HPCL </li></ul><ul><li>BPR OBJECTIVES </li></ul><ul><li>MAJOR CHANGES INITIATED </li></ul><ul><li>SCENARIO - 2003 </li></ul><ul><li>HPCL - 2003 </li></ul>2 of 13
  3. 3. OIL INDUSTRY IN 1990's <ul><li>All major products regulated by OCC / Govt. </li></ul><ul><li>Profitability determined by permitted returns (12% Post Tax) </li></ul><ul><li>Market Share determined by Govt. / OCC </li></ul><ul><li>Imports of Crude & Products determined by Oil Economy Budget (OEB) </li></ul><ul><li>Planning (Corporate, Investment in Mktg & Ref. facilities etc) prerogative of OCC </li></ul><ul><li>Product shortages in Market </li></ul>3 of 13
  4. 4. STRUCTURE AT HPCL <ul><li>Organization structure in line with market requirements </li></ul><ul><li>Focus on meeting Govt. Guidelines </li></ul><ul><li>Customer at a distant horizon </li></ul><ul><li>Strong focus on Project implementation to ensure continued profitability </li></ul><ul><li>Distribution key function of marketing </li></ul><ul><li>Command & Control Structure </li></ul>4 of 13
  5. 5. LIBERALISATION - A NEW AWAKENING <ul><li>Severe Foreign Exchange crises in 1990's leads to Liberalisation of the Indian Economy </li></ul><ul><li>Oil Industry becomes focus area for change in view of large investments required to meet energy demand </li></ul><ul><li>Marketing of Lubricants and other products de-regulated in early 1990s </li></ul><ul><li>JVC's in the Refinery Sector and Licensing of Private Sector Refineries </li></ul>5 of 13
  6. 6. CHANGES IN HPCL <ul><li>Govt. sponsored industry reports indicate impending changes in Indian Oil Industry </li></ul><ul><li>HPCL (in 1995) introspects on preparedness to meet external challenges </li></ul><ul><li>Resorts to periodic structural changes to enhance speed of decision making </li></ul><ul><li>Identifies need for external help </li></ul><ul><li>Appoints Anderson Consulting (now Accenture) to carry out Business Process Re-Engineering </li></ul>6 of 13
  7. 7. BPR OBJECTIVES <ul><li>Visualise the structure of Indian Oil Industry in the next decade </li></ul><ul><li>Study the possible effects of private and MNC competition </li></ul><ul><li>Identify Focus Areas in Refining & Marketing </li></ul><ul><li>Re-Design Organization structure to meet the new, emerging requirements </li></ul><ul><li>Learnings from other countries to be used </li></ul>7 of 13
  8. 8. MAJOR CHANGES INITIATED <ul><li>In search of the elusive customer : </li></ul><ul><ul><li>defining the customer </li></ul></ul><ul><ul><li>understanding customer requirements </li></ul></ul><ul><ul><li>providing economically viable options </li></ul></ul><ul><li>Re-designing the organization structure to focus on customer requirements : </li></ul><ul><ul><li>Formation of SBU's </li></ul></ul><ul><ul><li>Redefining jobs </li></ul></ul><ul><ul><li>Reduction in hierarchical layers </li></ul></ul>8 of 13
  9. 9. MAJOR CHANGES INITIATED <ul><li>Re-vitalising processes for faster, better decision making : </li></ul><ul><ul><li>Enhanced financial limits at all levels </li></ul></ul><ul><ul><li>Delegation of authority & responsibility </li></ul></ul><ul><ul><li>Tools for better decision making </li></ul></ul><ul><li>Implementation of ERP system for : </li></ul><ul><ul><li>Better Customer Service </li></ul></ul><ul><ul><li>Accurate & timely transactions </li></ul></ul><ul><ul><li>Updated data for decision making </li></ul></ul>9 of 13
  10. 10. MAJOR CHANGES INITIATED <ul><li>Focus on Profitability : </li></ul><ul><ul><li>SBU's become profit centres </li></ul></ul><ul><ul><li>are self contained units </li></ul></ul><ul><ul><li>extend across the value chain </li></ul></ul><ul><ul><li>Specialization for better customer service </li></ul></ul>10 of 13
  11. 11. SCENARIO - 2003 <ul><li>Refining sector de-regulated in 1998 </li></ul><ul><li>Marketing de-regulated in 2002 </li></ul><ul><li>Private sector Refining a force to reckon with </li></ul><ul><li>Retailing rights available with a number of companies </li></ul><ul><li>Traders & end consumers free to import their requirements </li></ul>11 of 13
  12. 12. HPCL - 2003 <ul><li>SBU structure in place </li></ul><ul><li>ERP under implementation </li></ul><ul><li>Better focussed to meet customer requirement & Competition </li></ul><ul><li>Remarkable upgradation in employee competencies </li></ul><ul><li>Many successes, some failures </li></ul><ul><li>A very profitable, best managed company </li></ul>12 of 13
  13. 13. Shri M.B. Lal, Chairman, HPCL, receiving the “ BEST MANAGED COMPANY AWARD ” (instituted by “ BUSINESS TODAY ” & “ A T KEARNEY ” ) from Shri Jaswant Singh, Hon ’ ble Minister for Finance.
  14. 14. THANK YOU

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