Key Success Factors: Driving Operational Efficiency in Fuel Management

In today's fast-paced and cost-sensitive industries, managing fuel efficiently is critical. A Fuel Management System (FMS) is a technology-based solution designed to monitor, control, and optimize fuel consumption within a fleet or facility. Whether reducing fuel theft, tracking usage trends, or improving operational efficiency, a robust FMS maximizes performance.

Four key factors are essential in determining your FMS's likely and long-term success. These include:

Accountability: Are your key stakeholders, from mine or rail equipment operators to operations supervisors to the mine or railyard general manager, aware of their role and committed to delivering successful outcomes?  Have you benchmarked the current state and established effective KPI’s?

Resourcing: Do you have sufficient resources, and have you correctly assigned and trained the right people?

Reconciliation: Do you have processes and systems to ensure that all inflows and outflows across your operation reconcile within a suitable error limit so you can be confident you are optimising fuel truck routing, PM, and fuel and lubricant use?

Data maintenance and integrity: Do you have checks and processes to ensure that only correct data continuously enters the system?

Accountability

A fuel management system spans many areas of your mining or rail organization, and departmental accountability is critical. Each stakeholder needs to be aware of their role in delivering successful outcomes. Mines and railways with poor fuel management often lack overall management of fuel and lubricants on-site. Typically, different departments within a mine or railyard will have very separate responsibilities.

For instance, this could include:

• The supply chain/warehouse department is responsible for managing inventory and re-ordering.

• Infrastructure maintenance department – responsible for maintaining FMS non-mobile equipment.

• The fleet/service truck maintenance department maintains FMS mobile equipment.

• Production/operations management – responsible for refuelling intervals and consumption, as well as managing fuel efficiency projects.C

• Corporate management (finance / environmental/corporate governance) – Responsible for high-level decisions on fuel and lubricants.

While multiple tiers of coordination and effort are required to implement a best-practice FMS, core requirements such as system maintenance, data integrity, and practical reconciliation are precursors to additional benefits. For these to occur, a consolidated and collaborative effort is essential. Once these precursors are satisfied and maintained, the focus should be on driving performance.

Allocating efficiency activities and KPIs to relevant teams can ensure optimal accountability in your operation. 

Resourcing

From a resourcing perspective, best practice FMS management across multi-site enterprises requires three key initiatives. Figure 1 shows the link between FMS components, efficiency activities, resultant benefits, and KPIs.

1. Appoint a dedicated corporate Fuel Management System manager who reports to a senior-level production/operations executive. This person would:

• Benchmark performance across sites to improve fuel management efficiency and reconciliation outcomes.

• Coordinate data and IT standards for the FMS.

• Centrally manage the enterprise software application usage across the company.

• Drive best practices and coordinate user groups and business feedback for continuous improvement.

• Drive integration with other relevant business systems such as ERP and fleet management.

2. Appointing a “fuel champion” on each site, who would be the primary contact for the FMS manager. This person would:

• Coordinate all intra-departmental hydrocarbon and alternative fuel activities.

• Ensure the database is up to date with all equipment items

• Review reports and analytics to drive performance

• Ensure FMS equipment is maintained correctly.

• Manage the site's FMS continuous improvement program.

• Onboard new staff and provide basic training and set-up for new employees.

• Ensure fuel management policies are maintained.

3. Classifying the FMS as a primary requirement for production is critical in ensuring the FMS obtains a high profile within the site, attracts suitable resources, and realizes the system's benefits.

Reconciliation

Completeness and accuracy of data are critical to the success of your FMS implementation. Maintaining the completeness and accuracy of your Fuel Management System data is important in delivering the system's benefits and maintaining the trust of users and stakeholders.

Without trust in the data, users are less likely to act on the insights gained from an FMS. A tank-by-tank inventory reconciliation of fuel and lubricants, down to the fuel consumption and uptime level of each fuel-consuming asset, is critical to the success of any fuel management system.

The required accuracy is determined by the goals identified for system implementation, yet maintaining the reconciliation within the target level is a critical KPI. The requirement to reconcile each tank, rather than the site as a whole, is driven by the improved ability provided to identify and resolve system anomalies or issues.

The achievable accuracy of reconciliation depends on several factors, including the accuracy and precision of any measurement transducers and hardware, the maintenance and calibration of the system, and environmental factors. It is essential that a threshold is set and key system users are accountable for its achievement.

Once a suitable reconciliation error is achieved, your business can focus on the many other benefits possible from your FMS implementation, knowing that you can trust the data and insights provided by the system.

Maintenance and Data Integrity

If a tank-by-tank reconciliation KPI can ensure the data is complete and reliable, system maintenance is the precursor to providing quality data input. Whether you have an SLA with your fuel vendor or maintain the system yourself, clear system availability metrics and understanding their impact are key.

Figure 2 outlines best-practice fuel management, in which maintenance enables data integrity, which in turn enables performance.

Once a maintenance and data integrity foundation is established, the FMS's value can be driven during the performance phase.

 An FMS implementation will enable the performance of efficiency activities that deliver benefits or value to your business. These activities should be measured using relevant KPIs.

 Without the support of teams in the field, small issues, such as new equipment items not being authorised for fuel, can lead to larger issues, such as bypassing the system and not returning to operation. This can have a detrimental impact on data integrity way beyond the magnitude of the initial problem.

Without the support of teams in the field, small issues, such as new equipment items not being authorised for fuel, can lead to larger issues, such as bypassing the system and not returning to operation. This can have a detrimental impact on data integrity way beyond the magnitude of the initial problem.

Figure 3, for instance, shows a simple example of how a small issue, such as a new equipment item arriving on site without an RFID tag, can have a significant impact. For more information, visit our site or contact us now.