Understanding the Importance of Oil KPI Software

Oil companies today are operating more effectively than it ever had before. Had it not been for people who have revolutionized the way business managers allocate their funds efficiently, had it not been for learning experiences that taught businesses to think before taking action, and had it not been for a ground-breaking organizational metric system called KPI or key performance indicator, the world probably would run out of oil reserves in the next few years.    Key performance indicators are just like what its name suggests. These are keys or specific areas of business activities used as measuring tools to determine, assess, and re-evaluate the progress of a business organization based on its goals. Corporates are usually driven by profit-oriented goals. In reality though, it is these keys that drive businesses towards attaining their ultimate objectives.KPIs for oil companies are a big part of its day to day operation. Combining all of the world’s largest oil reserves, the world has about 900 years to consume. United States alone eats up 21 million barrels a day of oil. Imagine a world that’s consuming oil at a present rate and oil companies are inefficient in meeting this demand. Cars, ships, airplanes – the world will literally stop because gas stations have emptied up their tanks already.This is why oil companies today employ KPI, not just as a strategy, but as a practice in the form of using business software that calculate the development of a business activity. Normally, organizations use applications like risk management, inventory management, logistics planning and execution, and supply demand management. Unfortunately though, there are those who still haven’t grasped the whole concept of KPI.In order for one to understand the influence of KPI applications for the oil business, there are three practical advantages. First, KPI helps the company evaluate numbers or results. Here is a very good analogy. Business is just like climbing up an 800-tread stairway. The goal maybe is to reach the top of the stairway within eight hours. Let’s say, one climbs at a rate of 100 steps per hour. The number of treads one takes per hour is the KPI. That’s the key. If that person climbs up at the same rate on the next hours, he will achieve the goal right on.Second, KPI helps the company make practical decisions. Taking from the previous analogy, if that person climbs up the stairs at a lower rate, say 30 steps per hour, that person needs to make a strategy and re-think his plans. On the second hour, he must be able to increase his rate. That is just so true with oil companies.Third, KPI helps the company trace its progress. Imagine what would happen, if the climber will not keep track of his hourly climb rate. He will keep on climbing up the stairs without ever knowing if he is able to reach the top on time.Oil KPI software then is an indispensable tool. With this, the oil company is able to make accurate plans, improve asset utilization, and achieve sub-goals, like increasing new clients and decreasing lost clients. These are just some of the practical uses of KPI for an oil business. So, whether one owns an oil distribution firm or manages a small gas station across the street, KPI software, therefore, should be present in the operation.