Commodity price fluctuations affect petroleum companies so strongly that Canadian oil and gas firm Gibson Petroleum is using a web-based budget application to help determine the impact the volatile marketplace has on its bottomline.
Through BudgetPLUS, offered in South Africa by Dimension Data group company SPL, Gibson Petroleum is empowering decision makers to become proactive information users.
For instance, Gibson's managers can use BudgetPLUS to see the impact changes in commodity pricing will have on their budgets. Tammi Price, supervisor, corporate planning and development at Gibson, explains: "Because Gibson's business is implicated by commodity price movements, the marketplace in which the company operates has been quite volatile.
"Commodity prices have been fluctuating rapidly," she says. "In particular, the crude oil index has been very unpredictable in the last 12 months because of the crisis in Asia, and the crude oil oversupply. Such fluctuations can have a significant impact on our bottom line.
"And BudgetPLUS's built-in 'what-if?' capabilities will prove useful when managers want to determine the impact of adding another business unit or product line," says Price.
BudgetPLUS helps Gibson, with six business units and more than 300 employees, collect and manage its budgeting process over a range of diversified operations.
"With BudgetPLUS, we have gained an integrated budget and analysis package that will allow us to have a central repository," says Price. "BudgetPLUS allows us to share data, facilitate changes, and ensure data integrity."
Gibson's executives will also benefit from BudgetPLUS's analytic capabilities. Price says: "I see our executives having an Intranet page that has alarms and alerts tied to key business unit indicators for each vice president. The BudgetPLUS software allows us to build in monitors that notify our executives of any occurrence outside the range of tolerance.
"Our managers will be able to drill down into the information for a more in-depth look at what's causing problems. One of our executive sponsors, the vice president of finance and administration, quite likes BudgetPLUS's data visualisation capabilities because they allow him to visually analyse so much information on one screen," says Price.
Expanding on the benefits of BudgetPLUS, Gavin Steinberg, business manager at SPL, says: "Unlike primitive file-based budgeting products and some spreadsheet solutions, BudgetPLUS has a centralised database, so plans, budgets, forecasts, and actuals are readily available for reporting and analysis."
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Dimension Data & SPL
Dimension Data Holdings Limited is a global Information Technology Integration corporation based in Sandton, South Africa. The company, which is listed on the Johannesburg Stock Exchange, has a turnover of approximately US$1.5 billion. The Group has representation on five continents and operates out of 36 countries. The Group has achieved a compound annual growth rate of 98% in turnover and 57% in headline earnings per share over the past 5 years. The Group is focussed on communications/ networking infrastructure and electronic commerce software applications, two of the highest growth sectors of the information economy.
SPL, part of the Dimension Data Group, has long been recognised as a high value IT partner to South African corporations and government. The company focuses on customer management, information management and enterprise systems.