Across the country, teachers are injecting technology into their curriculum, accelerating their students’ growth and exposing them to real-time news and events across the globe. Digital cameras, iPads and more readily available computers deliver an interactive and three-dimensional learning experience, replacing classic teacher pontifications. But what about the petroleum industry? Who’s to say operators couldn’t benefit from this boom in technology and visual learning?
Such a situation is playing out in the Midwest, where Toledo, Ohio-based truenorth energy, a Shell marketer of more than 300 company-run and dealeroperated stores across Illinois, Ohio and Michigan, is partnering with Houstonbased fuel solutions provider FuelQuest.
Specifically, truenorth has embraced the ForeSite fuel management program, which, as FuelQuest describes on its website, “provides real-time, independent visibility into fuel management operations, allowing supervisors to monitor and ensure the accuracy and effectiveness of their replenishment plans.” In other words, ForeSite allows users to view a map of all their fuel sites, color-coding the sites based on fuel level. “We’ve taken the station employee out of the gasoline delivery business,” says truenorth president Mark Lyden of the ForeSite software. “They don’t worry at all about when the fuel’s coming.”
Finding a Solution
Launched in June 2011, ForeSite is already making waves. “In more than 20 years of working in the software business, this is the best launch I’ve seen in terms of adoption,” says David Zahn, FuelQuest’s vice president of marketing, citing that several major chains, including 7-Eleven, have adopted the program.
“However you’re managing your fuel, are you doing it the right way?” Zahn asks prospective users. “We cover the overlay. When you’ve got two, three, four sites, you can manage that fuel on your own. It’s when you start to get to 10, 100, 1,000 sites … at some point, you get to where you can’t manage it without some kind of service.”
Anyone in the petroleum industry knows the cost of mismanaging fuel. With the national average cost of gas at $3.80 per gallon (as of March 1), running out of fuel for any amount of time is an expensive mistake. A leak could be even worse. But it’s also costly to carry excess inventory.
ForeSite, Zahn explains, strives to address the issues of too little or too much fuel—making it last-mile fuel management.
“The whole idea of last-mile fuel management is easy for the large chains to understand,” Zahn says. “Not as much for the smaller companies. They need to see the importance of this; it’s an education that needs to happen. They can have the same technology as the big guys down the street.” After being impressed with the Fuel- Quest video demo, truenorth launched the ForeSite software last November. “We’d had another program we’d used for quite a few years,” says Mickey Conway, truenorth’s vice president of trucking. “ForeSite got us into the 21st century.”
However, Conway is quick to point out that truenorth also implemented FuelQuest’s Fuel Management System (FMS)—and would not be able to properly operate with just the ForeSite software alone.
“Basically, the FMS program is like a cake and ForeSite is like the icing,” he says. But it’s a pretty fulfilling icing for a company that admittedly spends quite a bit of time ensuring the right amount of fuel gets to the right station at the right time. “We micromanage inventory to help improve cash flow by delivering the product when it is needed and can be sold in a timely manner,” Conway says, citing how frustrating it is for dealers to pay for fuel so far in advance.
Both FMS and ForeSite have all but obliterated this problem, tracking not only when the fuel gets low, but also forecasting sales for individual locations, casting color-coded maps that simplify the fuel management process.
“When you look at your loads in a particular district, it will tell you by color-coding how urgent the situation is,” Conway explains. “Red means fuel must get there on this shift or they’re going to run out. Yellow is an early warning and you’d better take a look. Then you have green, which is the safe zone.”
These real-time updates mark a huge change from the program truenorth used previously. “ForeSite pulls the data every hour,” says Lyden. “It’s real live data, whereas our other system pulled the data once a day. That is a huge feature.”
And according to Conway, FuelQuest continually adds features to an already impressive program. “One of the things FuelQuest just recently gave us is when one of the stations’ status turns from yellow to red, they send us an email,” he says. “My assistant and I get those emails at home, in addition to the dispatcher on duty. It forces the dispatchers to respond immediately, letting us know they’re taking care of the situation.”
Because the ForeSite software can be used from anywhere—offices, home computers and even iPads and smartphones— it has drastically changed the way truenorth’s dispatchers operate.
“If there’s nobody in the dispatching office, with the email capabilities, they can dispatch off a PDA or at home off their laptops,” Lyden says. “It’s really convenient.”
Though only three months into the program, both Conway and Lyden find themselves impressed by ForeSite. “It’s cutting edge. It’s state of the art,” Conway raves. “It really is amazing.”
Finding ROI
When speaking about the savings ForeSite could yield, Zahn has a very specific focus.
“Once the fuel’s in the ground, it’s an expensive asset—you need to monitor it for variances,” Zahn says. “You can avoid run-outs by using this software. Why risk a chance to be without fuel for 24 to 48 hours?”
But saving sites from running out isn’t a huge selling point for Conway and Lyden. “Basically, we don’t have run-outs,” Conway explains. “We didn’t have them before we got ForeSite and we basically don’t have them now. Most of our run-outs are due to a supply issue, not a dispatcher not doing what he was supposed to.”
However, truenorth has seen plenty of other returns on this investment, with one of the biggest savings in how they train their dispatchers.
“They can see a whole district, like Columbus, and all the stations in that district,” Conway says. “When they’re trying to determine where a certain station is, they can zoom right in and see where it’s located. They can also see what the last polling was—and poll again if they want to. Say the last polling was two hours ago; they can click on it and generate an immediate polling.”
This may not seem like a huge area of savings, but it certainly has been for truenorth, which has cut training time of new dispatchers from six months to two. And the remote monitoring has saved the fuel marketer time, money and stress.
“We just moved offices, causing our servers to shut down for a weekend,” Conway says. “But we were able to dispatch fuel loads from my house, using Wi-Fi-enabled laptops. We didn’t miss a beat.” And it doesn’t take a server shutdown for truenorth to take advantage of the mobility feature. The company uses it all the time.
“We only have one dispatcher per shift, operating from 5 a.m. to 1:30 a.m., seven days a week,” Conway explains. “If our second-shift dispatcher were not to show tonight, we wouldn’t have to be glued to the office. We could go home and manage from there.”
In fact, the ForeSite program has made it so easy for truenorth to manage its fuel that the company has reduced the number of dispatchers from six to four. “That’s a significant savings,” Lyden says.
But ForeSite has perhaps improved truenorth’s revenue most by allowing it to haul more fuel per load. With only three months of data, it’s difficult to accurately estimate just how much extra revenue ForeSite has generated. However, when truenorth compared January year-over-year numbers, it’s averaging significantly more gallons of fuel per load.
With the savings from dispatcher training and salary and extra income from a better gallon-per-load ratio, Conway does not hesitate to rate ForeSite’s ROI.
“Business software is a necessary expense,” he says. “But I think we’re getting bang for our buck.”
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