About 20 attended the Spring meeting of the API Petroleum Industry Data Exchange (PIDX) committee in Paris. PIDX Europe chairman John Boardman (Shell) welcomed SAP as the latest of PIDX Europe’s 25-strong membership. PIDX’ mission is to establish global business standards for the industry and its trading partners. The organization also works on business processes and documentation. PIDX has migrated its legacy EDI standards to an XML-based protocol, expanding its footprint to ‘complex products and services’ that support whole chunks of oil field activity like cement jobs or well completions.
Activity Report
Trade Ranger’s Randy Clark, PIDX chairman, reported that the classification task force’s revision to Segment 71 of the UNSPSC (Mining, Oil and Gas) has now been adopted as a UNSPSC code set. A new XML transaction standard includes schemas for custody ticket, petroleum products, order status request, receipt and advanced shipping notice. The Business Process workgroup has completed the credit memo standard and is working on standardizing the invoice-to-pay processes. In the downstream, EDI product codes have been updated and a downstream special interest group is working on a draft XML bill of lading specification.
Collaboration
PIDX has signed a memorandum of understanding with the chemical industry standards body, CIDX and RAPID, for a Joint Technology Plan (JTP) to collaborate on standards development. The JTP will evaluate OASIS, UPC, CEFACT, as well as web services, core component specifications, schema design best practices and cross industry standards. There is broad industry agreement that e-business is critical for Sarbanes-Oxley compliance. As XML standards mature, adoption is broadening, benefiting operations and ‘getting the attention of people in finance.’
Schlumberger
Mark Mack revealed that Schlumberger has been operating its own e-commerce system for internal purchasing and catalog publishing for several years. Schlumberger use industry standards ‘end to end’ from field ticket through purchase to pay to Request for Tender. The company dislikes reverse auctions and ‘non standard’ processes which might compromise Schlumberger IPR. For Schlumberger, PIDX is ‘the standard’. Today, 2/3 of its invoices are XML, the rest are legacy EDI. Clients want contract compliance, spend analysis and cost efficiency. Compliance involves a three-way match of purchase order, delivery ticket and invoice. This works for simple products but complex services generate a tiered price structure. The cost of a logging job cost may not be knowable beforehand—only between 0 and 20% of catalog items have a price!
Not too granular!
For Mack, spend analysis is not really a supplier issue. Clients should not to get ‘too granular,’ complaining, for instance, that ‘fuel charges are too high’. To understand your spend, you should look at how much is spent on logging, not at vehicle mileage. 95% of the e-business challenge is not invoice-related but centers on other documents and on pre-invoicing discussions. Clients need to ‘stay involved’ even if a PIDX capability is outsourced. Today, 9,000 users in 1,600 locations use the Schlumberger-developed eZView secure billing system and its online catalog of oilfield products and services.
SAP Industry Speak
According to Telma Gallo Sanchez, SAP’s ‘Industry Speak’ (IS) enterprise services architecture is a business-to-business facility, built atop SAP’s NetWeaver web services platform. Industry Speak promises connectivity with third party applications. PIDX is currently ‘outside of the SAP IS process.’ IS enables ‘closed loop’ processing from order to invoice. IS differs from traditional SAP development, allowing process automation across heterogeneous environments such as Siebel CRM and Microsoft Outlook.
Business messaging
Andy Ross (Business Web) introduced the AS2 routing protocol from the Internet Engineering Task Force (IETF). AS2, which is used by Wal-Mart to communicate with its suppliers, will become an alterative to RosettaNet for PIDX data. AS2 helps smaller companies avoid the high costs of middleware. PIDX business messages make extensive use of namespaces, ‘we chose to namespace everything’. This is compliant with W3C recommendations, but adds to bandwidth. Ross strongly recommends configuring middleware to support all W3C-compliant namespace standards.
Joint Technology Plan
Andy Ross outlined the CIDX, PIDX and RAPID Joint Technology Plan to ‘converge standards and bridge technologies’. This involves a joint study of the potential of web services. The focus is on standardizing schema naming and design. The carrot is CIDX/PIDX interoperability; after all, ‘an invoice is an invoice is an invoice…’ The plan is to define core components and vertical-specific standards. There are challenges regarding take up in an all-PIDX vertical. Notwithstanding a degree of flux, Ross stated that ‘standards are really taking off in North America.’
This article originally appeared in Oil IT Journal 2005 Issue # 6.
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