‘We share as much
data as possible with our clients!’
At Vopak, the company writes its own software and keeps all its important data in the cloud. Robots, drones and smart sensors are helping Vopak to improve its levels of safety, security and customer service.
Vopak may be 400 years old, but it has embraced digital technology with the enthusiasm of a new start-up. In 2014, CEO Eelco Hoekstra appointed a chief information officer, saying that ‘IT will be as important to Vopak as our storage tanks’. The man who got the job, Leo Brand, has attacked the digital transformation of the world’s biggest tank storage company with gusto. He was charged with making sure that the company made the most of digital technology, and has succeeded in doing just that.
What does digital transformation mean to Vopak?
‘We are global market leader in the storage and handling of chemicals, edible oils, gas and oil. We currently have 68 terminals worldwide, which are continuously fed and emptied by ships, barges, trucks and pipelines. Digitalisation offers enormous opportunities to boost efficiency in all these processes. Some of our terminals are 20 to 30 years old and our network includes 10,000 pumps and 250,000 valves. One way in which digital technology is helping us is in allowing these valves and pumps to talk back to us, so that we know what condition they are in. It used to be that someone would personally go and check them – a tremendous amount of time-consuming work. Now we are installing advanced sensors on our valves, so our engineers can monitor them at a distance.’
Leo Brand (53) joined Vopak as chief information officer in 2014, having previously served as CEO of Swisscom Hospitality Services. He began his career at KLM and later moved to AT Kearney before going on to found and manage companies Cell Technology, Adcore Technologies and Megabeam.
What are the advantages?
‘Collecting data about our terminals using smart sensors has allowed us to better predict when a valve needs maintenance or replacing, without sending someone to the site. If a valve breaks or a pump stops working, all our processes grind to a halt, and that has an impact on our clients. In addition, we have started using robots that we developed with the big oil companies, to inspect the bottom and sides of the tanks. Previously, we had to empty a tank completely to carry out an inspection, which meant it would be out of action for a couple of months. But we can now lower the robots into the liquid to carry out the checks, which saves both us and our clients a lot of money. Our activities are totally enmeshed in our clients’ own production processes. A chemicals company, for example, wants to be kept fully informed about stocks, capacity and maintenance. We are also using drones to inspect our tanks. They can fit in the narrow space between the inner and outer walls and check the equipment.’
Just get on
with the job and
Did you formulate a digital strategy before getting started?
‘Yes, because the first thing you have to do is convince everyone of the value of such a transformation. The costs are high, and you have to support them with a good business case. You have to convince the management board, the entire workforce, and, of course, the supervisory board. But don’t talk too much. Just get on with the job and show results. Four years ago we set up a special innovation team to map what had to be done with our terminals. So far, this team has gone through 200 proof of concepts. It is sensible to start out by digitalising a process which takes place smoothly, where changes have an immediate impact. Then you make a quick win and get more people behind you. If something fails, it means you made the wrong choice and you’ve learned an important lesson.’
Why are you developing your own software?
‘We did not need to do this for standard processes such as HR and finance, but we did write our own software for our core processes. We wanted to be independent of ERP suppliers who may not have the same priorities when it comes to product development – which is crucial for success in our business. I believe that every company is a software company and so we took on some 80 programmers and data architects. Data from our key processes is stored in the cloud and by developing our own software we have been able to organise these processes more efficiently. Our people no longer work with spread sheets but they have access to the cloud wherever they are, so they can easily find the relevant data. We’ve developed apps which download the necessary information about a given terminal directly onto a laptop, so people no longer have to move piles of paper. It is not only much more efficient, but our staff prefer it. The most important factor is that we are migrating our processes from a batch basis to real time. This is not only more efficient, but is more secure as well. And the transparency it generates helps our clients to plan better, which also leads to cost savings.’
‘If something fails,
it means you made the wrong choice and you’ve learned an important lesson
Has digitisation boosted client satisfaction?
‘They are certainly more satisfied and this is partly because we share as much information with them as we can. Clients notice that we are more alert in our reactions. If a ship is heading for one of our terminals, we can let them know when we will be ready to start pumping or will have the pipeline in place. We can also let them know if we don’t have any quayside capacity so we can consult with the client and perhaps advise the captain to sail more slowly. Then he will save fuel and won’t have to wait in the port area. Digitalisation has enabled us to guarantee our clients a faster turnaround time, which in turn helps them digitalise their own processes. We are going a long way when it comes to customer service. We are now testing super strong magnets in Singapore which will make mooring quicker than when using ropes. And ships will be able to get away more quickly as well.’
Robots, drones, smart sensors – are your staff not worried about losing their jobs?
‘Not if you explain why you are doing what you are doing, and move them to another part of the company. In our operation, planning is extremely complicated. At a big terminal, you might have eight planners optimising 1,500 parameters on a daily basis. We’ve worked together with them to create an app which can take over their jobs seamlessly. The planners recognise that the app can do their job better, faster and with fewer mistakes. And yes, they understand our decision to go for digital transformation all the more.’
Sector: Storage and handling | Product: Tank storage for chemicals,gas, edible oils and oil | Workforce: 5,733 | Active in: 25 countries | Turnover 2018: € 1.25 billion | Netto profit 2018: € 290 million
Read more inspirational examples in our
Digital Transformation special
Ground-breaking corporates such as Microsoft, Arcadis, Vopak, Ohra and Bunq give insights into their own, unique approach to digitalisation. Find out what top flight supervisory board member Petri Hofste thinks about the role of the non-executives in the process and discover how BDO's integrated approach makes the most of the opportunities which digital transformation can bring.