PDM SAP is all fired up about e-commerce, and is announcing a new internet portal mySAP.com. What will this mean for the oil industry?
Narasimha - mySAP.com was announced at this month's SAPPHIRE’99 (SAP's big US trade show – with over 14,000 delegates). The new e-commerce portal has specific components for the oil and gas industry. There is an oil and gas community home page with up-to-date information and E&P-specific content such as the latest analysts reviews and articles on industry trends. We are actively seeking business partners to collaborate on the content of mySAP.com. The community will consist of a business directory with over 2000 company entries - an aggregate of our existing SAP clients – using SAP’s existing products and collaborating on the development of new products. We plan to offer buyers direct links to sellers through an auction or tender process and will provide tools for validating purchase orders and shipment. Different oil companies will be able to trade or swap raw materials – say 40 thousand gallons of gasoline to be delivered to the Asia-Pacific market – and to have automated account reconciliation. Similar functions will be offered such as web-based ordering in the service station business.
PDM – e-commerce is understandable in this downstream context, but as you move back up the supply chain, such functionality may begin to look rather esoteric. Is there really an e-commerce market in the upstream?
Rafalsky – The Oil & Gas sector already has a very high profile in e-commerce. External procurement, and the sheer size of transactions mean the scope for improved business processes through e-commerce is enormous. Annual spend in the upstream on materials and capital expenditure has been estimated as around $100 billion. No, E&P is a focal point for SAP today, and believe me, we are very well positioned to develop solutions here with the help of our large customer base. As an example of enthusiastic client take-up, Statoil has acquired 18,000 procurement licenses for its employees. The whole organization has been affected and is now using on-line catalogues and preferred processes for procurement.
PDM – and what is the role of the new SAP Portal, mySAP.com in all this?
Narasimha – with mySAP.com, the workplace has become an electronic space and we no longer are concerned as to where the data actually is. A manager can access key financial indicators, pricing, can read newspapers and analyst reports – in short has all business critical information on screen and in real time.
PDM – It sound as though SAP is going head-on with Microsoft’s Digital Dashboard concept.
Rafalsky – Actually SAP has developed a very symbiotic relationship with Microsoft over the years. We operate in the specific Business to Business sector – our target is not the consumer. We also have an eclectic attitude to best of breed software. We replaced our own, integrated mail system with Microsoft Outlook – we are not competing with Microsoft, neither on office applications or over the start screen. The use of a web browser offers generic technology for presentation, while using all the functionality of R/3 for access transactions.
PDM – We’re still some way from E&P
Rafalsky – We currently supply our software to 29 of the top 30 oil and gas companies. We are working with them and our business partners, to expand the footprint of R/3 to optimize business process throughout the industry. Specifically we are working with our partner Landmark Graphics and with the COM for Energy Foundation – who are presenting a demonstrator of this technology at the current SAPPHIRE’99 conference.
PDM – how does the direct Landmark to SAP link relate to COM for Energy?
Rafalsky – the partnership with Landmark has a focus on graphical configuration and is an attempt to standardize the interface between R/3 and Landmark’s Oilfield Workstation. COM for Energy has a broader scope and will offer non-GUI based data transfer through XML.
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