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Piloting valero with real-time management case study

Valero owns 16 refineries in the United States, Canada, and Aruba that produce gasoline, distillates, jet fuel, asphalt, petrochemicals, and other refined products. The company also owns 10 ethanol plants located in the Midwest with a combined ethanol production capacity of about 1.

The COO and his team review the performance of each refinery in terms of how each plant is performing compared to the production plan of the firm. For any deviation from plan, up or down, the plant manager is expected to provide the group an explanation, and a description of corrective actions. The headquarters group can drill down from executive level to refinery level and individual system-operator level displays of performance.

MIS (Three Case Studies)

The data are refreshed every five minutes. Using the shared data, managers will be able to share best practices with one another, and make changes in equipment to reduce energy piloting valero with real-time management case study while maintaining production targets.

The dashboard system has the unintended consequence of helping managers learn more about how their company actually operates, and how to improve it. One of the dangers of real time management is not measuring the right things. How helpful were they? This reduced demand, combined with increased inventory levels, caused a significant decline in diesel and jet fuel profit margins. The price of crude and aggregate petroleum demand are largely beyond the control of Valero management.

The cost of refining crude varies within a very narrow range over time, and there are no technological breakthroughs expected in refining technology. Another limitation of real-time management is that it is most appropriate for process industries such as oil refining where the process is relatively unchanging, well known and understood, and central to the revenues of a firm. Dashboard systems say nothing about innovation in products, marketing, sales, or any other area of the firm where innovation is important.

Apple Corporation did not invent the Apple iPhone using a performance dashboard, although it might have such a dashboard today to monitor iPhone manufacturing and sales. What measures of performance do the dashboards display? What kinds of information systems are required by Valero to maintain and operate its refining dashboard? Should Valero develop a dashboard to measure the many factors in its environment that it does not control?

Why or why not? Read its corporate vision statement of strategic objectives especially vision statement 2. Devise a method for measuring these profitability factors, and then using electronic presentation software create a corporate profitability dashboard for senior managers.