21 Jul Transforming Your Fuel Supply Business
Google ‘digital transformation COVID-19’ and you’ll be greeted by hundreds of results of how businesses have been forced to shift their product distribution and/or internal processes.
The COVID-19 crisis is both a great tragedy and a chance for rebirth; now isn’t the time to want to return ‘back to normal’, but instead want the future sooner.
While the slate is clean, now is the time to look to the future and come out of this stronger while others retract to a way of working most will have left behind.
Undeniably, many things will return to existing processes, but we also can’t ignore the time saved, for example, by conducting a video call rather than a 3-hour round-trip for a 1-hour meeting.
With businesses now exposed to the risk of not having a digital strategy, we present three top tips a fuel supplier should explore before starting their transformation. First, though…
What is a digital transformation?
We can start by addressing what it isn’t. It’s not becoming a tech company. Being a fuel supplier, there are many parts of your business that will never be digital and there is no benefit in attempting to make them so.
It’s, instead, about integrating digital technology into your processes to increase the efficiency of the offerings you already have. It can be making communication within the business easier, tools that automate and track finances or digital routes for your customers to access information and interact with you quicker and easier.
A common misconception of a digital transformation is that it will be used to replace employees. This couldn’t be further from the truth. Zoom and Slack, which have seen an incredible boost during the lockdown, are companies that facilitate digital communication and therefore make it easier for teams and businesses to function efficiently.
Why is it important for fuel suppliers?
As margins become tighter, you need to look at ways of reducing time spent on the tasks that keep the business running, but don’t necessarily stimulate growth.
For instance, here at OnlineFuels we’ve built a solution that increases the number of channels you can sell through by enabling online transactions. It makes it easier for you to communicate your prices with your customers and it gives them access to information such as credit limits, contract volumes and order history via a few simple clicks.
It’s not undervaluing core interaction; it’s making more time for it. The relationships and deals that are done through human interaction will always remain that way, but once agreed, the platform helps you manage and execute transactions in a more accurate and frictionless way for both parties.
Digital tools like our Marketplace or Branded Sales Platform can take care of the repetitive and time-consuming tasks to allow your team to focus on the bigger goals that move your business forward. With this, we move onto the three tips for beginning your transformation journey.
Three top tips to consider before you start your digital transformation.
Tip One: Determine where your biggest gains are to be had.
Almost everyone I’ve spoken to acknowledges that technology will play an increasingly prominent role in their business, yet many don’t have a clear idea of how.
This is because it varies between each business and requires a discussion on where the biggest gains can be made by integrating a digital process.
Is it giving your customers easy access to key bits of information? Expanding your sales channels? Making sure you’re seen as an innovative power player in the industry and not falling behind? Or something else?
Take the time to plan out what processes might need improving, what strengths could be built upon and what digital options you have available.
Then, when you’ve calculated the areas with the highest rewards, you can continue to step two…
Tip Two: Buy or build? Which is the best route?
There are three main options for you to consider: These are…
- Build in-house:
What is it?
To build in-house is to assign the build to your inhouse development team based on your requirements. If you do not have an inhouse team of developers, hiring a new team adds significant risk and time to the project. There are advantages and disadvantages to this approach…
- Your team build functionality that isn’t available from other solutions, thus giving you an advantage
- Timescales are exceptionally longer than other methods, as you have to factor planning and hiring into the build.
- The cost is much greater. There is always uncertainty associated with building solutions from scratch. Any delays are costly and to stay up to date, your solution will require regular updates and maintenance.
- There is also a risk that the solution’s performance will fall short of other available solutions in use by your competitors.
- You will have to host on your servers and ensure they are maintained and are functional.
- Get a bespoke product built:
What is it?
The bespoke option sits in between the subscription and the built in-house solutions. With the option, you buy and own the technology that has been built by a third-party provider.
- You own the product. However, this also means you have to maintain and upgrade it (or commit to a maintenance retainer).
- Timescales are shorter than building in-house as you don’t have to hire a team of developers
- A large upfront cost is required which, once added to any further development and upgrade costs in the future, can be a greater total than a subscription model.
- A high risk of the product falling behind other industry solutions making the investment unrewarding.
- Despite timescales being shorter than an in-house build, it is not as quick or seamless as a cloud-based subscription solution.
- Often, you are required to host this yourself meaning any downtime or crashes will have to be restored by a third-party or in-house developer.
- Use a Software as a Service (SaaS) Solution :
What is it?
Subscription models are cloud-based solutions that are ready to go with just an internet connection. They are built, maintained and constantly improved by a third-party provider for a recurring license fee. OnlineFuels are built as a SaaS solution for the following reasons…
- A flexible solution that immediately opens digital routes for your business. Being cloud-based, updates occur much more often and your feedback is acted on quicker.
- Functionality is guaranteed.
- Continuously updated by a large team with years of experience in the industry. Most pre-built subscription services have years of industry knowledge behind them.
- All you need is an internet connection. No servers or additional hardware or security are required.
- Integrates into your existing Energy Trade and Risk Management (ETRM) systems.
- You don’t own it. Although, the advantages of having a working solution from day one and the reduced timescales involved in setup far outweigh this.
Tip Three: Timescales and commitment.
Coordinating a digital transformation is a daunting task. In ‘normal times’ it’s often easier to do nothing at all, but in a crisis, not acting is risky. Some things have essentially changed overnight, but these are extraordinary circumstances. The only thing that does have to be made as quickly as possible is whether you are going ahead with a digital transformation or not.
Don’t innovate for the sake of innovating – tailor everything to user outcome. Don’t try and ‘be’ a tech company, just improve your offerings for customers and your employees. It’s about adding value but staying true to your brand’s core propositions. If you pride yourself on service, use technology to make it easier for your customers to get information.
Once you decide to start integrating a digital strategy, you and your company have to be fully committed. Making it easy to adopt the new strategy is critical, as you need a strong buy-in from your employees.
There are countless examples of fuel suppliers acknowledging that they should incorporate digital into their strategy, but then delaying the transition until it was too late. It’s a case of not seeing the new opportunities for the current way of working.
COVID-19 has exposed a lot of these and given fuel suppliers a chance to reset. Quickly decide to use digital and then carefully find the right solution for your needs.
Take this moment to welcome and embrace the future sooner rather than want ‘normal’ back.