IT-Enterprise digitalizes business processes at UKRNAFTA’s chain of gas stations
PJSC Ukrnafta continues systemic digitalization, which has already covered 6,000 users, 4,500 simultaneous working sessions, and 18,000,000 processed operational documents. The process is developing in accordance with the digital map, so the company is moving towards a full transition to electronic document management for more than 20,000 employees, scaling up ERP functionality and transforming the company into a true “digital tiger”.
Currently, digitalization is being expanded to businesses within the company's structure, while the processes of the Ukrnafta retail chain of gas stations are being built based on the corporate ERP core. This is one of the large-scale joint projects between Ukrnafta's IT team and IT-Enterprise team, with a whole range of non-standard processes and integrations with third-party IT systems for all 545 stations of the network.
"The first step in Ukrnafta’s digitalization was to implement standard HR and payroll processes. At the second stage, we started working on more complex tasks: managing the logistics of petroleum products and business processes of the gas station chain. However, one of the most ambitious tasks was the implementation of excise accounting and end-to-end flow of fuels and lubricants, which significantly improved management efficiency," says Olga Chukhmanenko, Head of Business Applications at Ukrnafta's IT Department.
The project followed a phased implementation plan. The first phase included creating the “to be” model, which took a year to develop and required an additional audit of processes, refinement of functionality, in particular, due to the complex issue of fuel and lubricants pricing.
The second phase was the actual digitalization project, joined by each of the five regional chain offices (branches) in a phased manner. The Kyiv branch launched a pilot for the updated business processes in ERP. This area of work was critically important as this regional office became a ‘test subject’ for checking all hypotheses, mechanics and approaches that would later be reproduced in other locations. After Kyiv’s success and a three-month pause, the Dnipro branch was the next to join the project, scaling up the processes and experience. Within eight months, all Ukrnafta’s branches adopted the ERP system and the new standards.
"The pace and attention to detail that Ukrnafta demonstrates throughout the process of change and optimization of business processes is an example for many companies seeking effective transformation. This is also an example of balanced work of the customer's and developer's IT teams, which have developed so many complex business processes in less than a year. These include accounting and excise accounting, integration with the front-end system (payment processing software used at checkouts), payroll, and calculation of the cost of fuel and lubricants," says Oleg Shcherbatenko, founder and CEO of IT-Enterprise.
According to Ukrnafta, business process digitalization has made its retail chain more efficient and transparent. The processes have become more understandable and manageable since information about the movement and expected supply of fuel and lubricants is now automatically sent to the gas station checkout operators.
Automation has ensured the correctness and relevance of fuel and lubricants posting data by minimizing manual data entry for cash desk operators, accountants, logisticians, etc. Now all operations go through the end-to-end processes in the ERP system in both directions: each fuel receipt is registered automatically, and the confirmation of the operations performed is returned. As a result, work has become faster and more reliable with minimal errors.
"In addition, the ERP system allows us to manage the movement of fuels and lubricants more efficiently at every stage. Now Ukrnafta tracks every liter of fuel: from the moment it arrives at the warehouse to the customer's vehicle. We can plan delivery routes more efficiently, control tank balances and predict the fuel demand of our gas stations. Not only has the movement of fuels and lubricants become faster, but also more cost-effective," says Andriy Bobrov, Ukrnafta's CIO.
Another benefit at this digitalization stage is fast report generation. Within just one day following the cash shift at the gas station, data on all transactions is transferred to the accounting module for processing the documentation and closing shift reports for the gas station.
As a universal standard, Ukrnafta has introduced a unified methodological framework for accounting at the gas stations in its chain, as well as the rest of the company. The main operations are unified to eliminate data duplication and ensure control at all stages. Indeed, data is entered into the ERP system once at the “entry point” and is used throughout the entire business process chain.
Ukrnafta notes that these changes have greatly added to transparency and control at every stage of work. At the moment, the solution’s functionality continues being developed and enhanced.
The implementation of a single ERP for all the company’s businesses has significantly optimized processes and synchronization between them, transforming the approach to organizing business processes into a systematic and end-to-end one.
PJSC Ukrnafta is the largest oil company in Ukraine, producing oil and gas at 1,832 oil and 154 gas wells (as of January 2024). The company's structure consists of two business units Ukrnafta East and Ukrnafta West, including six oil and gas production divisions and three gas processing plants. Other units are the Oilfield Services Division, with a full range of services for the oil and gas industry, and the Ukrnafta Drilling Division, responsible for exploration and production drilling. UKRNAFTA's mono-branded gas station network includes 545 gas stations in almost all regions of Ukraine.
IT-Enterprise, a Ukrainian product IT company, has been operating for more than 35 years, driving the digital transformation of the country's largest real sector companies: Interpipe, Ferrexpo, Nibulon, Ukrposhta, Ukrnafta, Ukrzaliznytsia, and others. Since the first days of the full-scale war, the IT-Enterprise team has been working with the government and local authorities to implement key strategic projects for Ukraine: accounting for humanitarian aid, restarting procurement, and relocating businesses. The company's founder and CEO Oleg Shcherbatenko is a staunch advocate of the Industry 4.0 and 5.0 approach and technologies.