Chevron sets high bar for petroleum distribution quality
Oct 1, 2008 12:00 PM, By Charles E Wilson
The Global Marketing Logistics department oversees a very large fuels distribution system. The department coordinates worldwide distribution of approximately 12 billion gallons of fuel products each year. Roughly a third of the total volume is handled by Chevron's proprietary fleet of 500-plus petroleum transports, 115 of which are in the United States. Approximately 100 contract carriers transport the overwhelming majority of fuels shipments. They range in size from hundreds of trucks to as few as 10.
“We significantly reduced the total number of contract carriers over the past couple of years,” says Ken Smith, Chevron Global Logistics Center of Focus general manager. “We look for transportation partners who can meet our high standards or are willing to make the needed changes to do so. They absolutely must embrace our Road Transport Safety management policy. That is a tough step for some of them, but we make it worth the effort.
“We start with a three-year contract, but our objective is to build a long-term relationship. We are there to help them if they make the commitment, and most say it is worth the effort. We want them with us indefinitely. By reducing our total number of contract fleets, we're able to give our carrier partners more business. That means more revenue for them to help cover the vehicle technology improvements that help make their operations safer and more productive. It is a win-win arrangement.”
The 10-point policy provides a comprehensive approach to managing road transport safety. “We make it clear to our contractors that this program applies to our own fleet just as it does to theirs,” Smith says.
Element one of the program defines fleet management responsibilities and accountability. Responsibilities for managers, supervisors, and drivers are clearly defined. Key elements of the mandatory safety program are laid out, including vehicle inspections, crash investigations, and emergency response.
Each carrier partner must implement an audit procedure to verify compliance with the various facets of the program. Monitoring occurs at all levels of the Chevron Global Marketing Logistics system. Chevron managers meet with carrier partners as often as monthly and not less than quarterly to review a range of operational factors, including on-board computer data. Annual reviews also are conducted.
These reviews play a big role in Chevron's “Global Carrier of the Year” program. The award recognizes demonstrated excellence in the implementation of the Road Transport Safety Management system. The 2007 winner was Transportes Barahona, a carrier based in Comayagua, Honduras.
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