On the heels of its win at Equilon, SCT Corporation recently secured another
high-profile contract in the petroleum products sector with Valvoline,
the $1.1 billion lube oil division of Ashland Inc. Valvoline will use
Fygir Supply Chain Planning suite as part of a larger initiative to support
its e-business efforts. The contract has a total value of more than $4
million in license fees and services.
by SCT in 1998, Fygir supply chain suite provides the critical ingredient
for SCT's integrated enterprise planning and execution suite, iProcess.sct.
iProcess.sct binds together SCT's Adage Supply Chain Execution software,
advanced planning features from Fygir, and ecFoods' Internet Trading Exchange.
The combination neatly unites ERP, Supply Chain Management (SCM), and
Fygir suite itself consists of modules for advanced planning, advanced
scheduling, and demand planning. The Fygir products enable users to improve
their supply chain management performance and make their manufacturing
process more efficient by applying mathematical techniques to optimize
the supply chain.
Lube oil represents just one component of Valvoline's growing business
that now includes antifreeze, automotive chemicals, refrigerants, appearance
products, and lube services franchising. As companies like Valvoline/Ashland
expand their product mix, it becomes increasingly important to maintain
visibility across multiple business units to avoid overlap and ensure
best use of common resources.
Valvoline's case, Fygir can help address inefficiencies that erode margins
and pull down profits. For example, though Valvoline's operating income
increased 40% to $74 million in 1999, compared to $53 million in 1998,
increased expenses in Latin America and lower international revenues robbed
the company of an even stronger bottom line. In 1998, large inventories
of its R-12 automotive refrigerant product at the distributor and retail
levels reduced demand and resulted in lower gross profit.
problems are by no means unique to Valvoline but are common in the industry
and represent a golden opportunity for supply chain management tools like
Fygir. The petroleum sector is not among SCT's core industries but shares
similar processes and problems with chemicals manufacturing and food &
beverage, both of which are well-represented in SCT's client base. The
king of petroleum supply chain management is indisputably Aspen Technology,
which counts among its clients 17 of the top 20 refining and exploration
companies. We expect Fygir to continue to do well within petroleum as
it offers more "out-of-the-box" functionality than Aspen Technology.
Fygir has found wide success in the process manufacturing industries and
these users would do well to include this component of iProcess.sct in
selections with other best-of-breed supply chain management software from
Logility, and Aspen Technology.
users considering a migration to Oracle based servers, SCT could help
ease the transition. The company currently has an agreement with Oracle
Corporation allowing it to sublicense a limited-use Oracle system, which
enables a client to use Oracle with its software products at a significantly
lower cost than a full-use Oracle license. The agreement expires in July