Heartland Upgrader Offgas Project Management at Aux... · 2010-05-28 · Confidential Slide 14 Accounting System Replacement Business Drivers for Change Significant commercial contract

Confidential

Aux Sable Creating a Change Management Focus on ERP projects

May 27th, 2010

Confidential Slide 2

Contents Aux Sable Corporate Profile Change Management – History, Approach Change Management Planning Accounting System Replacement

Business Drivers for Change Software Selection Resourcing Structure Support Communications Control Education / Training

Challenges / Opportunities Deliverables / Results / Benefits Achieved Summary: Learnings / Success factors

CONFIDENTIAL

Alliance Pipeline System – BC to Illinois

3


Corporate Profile - Formation

Aux Sable was established as part of the development of the Alliance Pipeline system.

Alliance Pipeline transports Natural Gas Liquids (NGL rich) gas from BC, AB and North Dakota to Illinois

Two companies were established, one in the U.S. (Aux Sable Liquid Products or “ASLP”) and one in Canada (Aux Sable Canada or “ASC”) to manage the NGL business associated with the Alliance Pipeline.

Aux Sable has the exclusive right to extract NGL’s from Alliance Pipeline gas.


Corporate Profile

OWNERSo Enbridgeo Fort Chicago

Aux Sable Canada LP

OWNERSo Enbridgeo Fort Chicago o Williams Companies

Aux Sable Liquid Products LP

Canada USA


Corporate Profile ASLP Channahon Facilities

Aux Sable owns and operates one of the largest state-of-the-art extraction and fractionation plants in North America at the terminus of the Alliance Pipeline (Channahon, IL)

Capacity to process 2.1 billion cubic feet per day of naturalgas

Capable of extracting and fractionating approximately87,000 barrels per day of spec NGL products (ethane,propane, normal-butane, iso-butane and natural gasoline)

Commenced operations on December 1, 2000 concurrentwith the start up of the Alliance Pipeline System

Corporate Profile ASC

Located in Calgary, Alberta

Focused on enriching the gas stream

Business Development / Capital Project activities



ASLP – Channahon Facilities


Corporate Profile - Aux Sable Vision

Aux Sable’s vision is to be a market leader in themidstream gas processing and Natural Gas Liquids (NGL)industry within selected regions of North America whereAux Sable can secure and expand competitiveadvantages to achieve predictable earnings growth.

Recent Key Changes

Outsource IT support

CSOX Implementation

Accounting System Replacement

Materials Management System Replacement

IFRS Implementation

Corporate Financing Projects


Change Management Approach

Encourage a culture that supports change for the better

Prepare for change Confirm need for change Define scope of change Assess impact of change Develop a plan


Change Management Planning

Resourcing Obtain appropriate skill sets (internal, external)

Structure Develop a team focused structure

Support Involve key stakeholders

Communication Communicate change well in advance, effectively, efficiently and targeted Build a plan to focus on who, what, when, how and WHY


Change Management Planning con’t.

Control Approved Charter and Project Plan Oversight - project timeline, key deliverables, budget

Education & Training Provide appropriate education so that all affected staff are ready. Just In Time training. Plan for follow-up training post-project.



Accounting System ReplacementBusiness Drivers for Change

Significant commercial contract changed our business processes

Demands for enhanced system support for Canadian Sarbanes-Oxley (CSOX)

Potential new / different emerging business opportunities for the Canadian operation

New business demands for Asset management functionality (PP&E and Depreciation) Project Accounting / AFE capabilities Joint Interest Accounting / allocation capability Enhanced Financial, Management and Ad Hoc Reporting capabilities


Accounting System Replacement Software Selection Process

RFP sent to 12 vendors, short listed to 3 who formally presented solutions

Developed a list of comprehensive business requirements Multiple stakeholders engaged in the development Ensure the widest possible coverage of user base

A ‘scorecard’ approach was developed where key requirements were weighted and all members of the selection team graded each vendor’s ability to address each requirement. An overall weighted grade was then calculated for each product

Developed Total Cost of Ownership over five year period

Presented recommendation to Senior Management

ScorecardSummary Page


Vendor -

Requirement Overall Grade

Weight Weighted Score

Ease of Use

Comments

Total Score 100%

4.1 General System Requirements 10%

5.1 Master File Maintenance 10%

5.2 Budget and Forecasting 3%

5.3 Transaction Processing 3%

6.1 Product Accounting and Entero Integration 7%

6.2 Alliance NGL Business (ANB) Invoice 7%

6.3 Service Revenues 3%

7.1 Authorization For Expenditures (AFE) 7%

7.2 Procurement: Capital, G&A and Operating Expenses 3%

8.1 Joint Interest Accounting 7%

9.1 Fixed Assets and Sustaining Capital 3%

10.1 Cash, Credit and Treasury 3%

11.1 MS Office Integration 3%

11.2 Integration and Interfaces 10%

12.1 Close Process 7%

13.1 Management Reporting 7%

14.0 Systems Technology and Integration 7%


Accounting System Replacement Why Dynamics AX?

Presented similar look and feel of existing Microsoft office products in use at Aux Sable Reduced employee impact Eased training requirements

Met functional criteria of Aux Sable Business Users Generated highest score for key business processes Generated highest score in ease of use Provided flexible account coding structure to support future business direction Provided user friendly, ad hoc reporting capability

Provided opportunity for future integrated functionality Flexibility to adapt to future change

Resourcing Project Team (internal)

Accounting experts from both countries seconded to project full-time Backfilled for internal accounting experts

Steering Committee Responsible for overall project success Key decision makers from accounting, finance and IT management

Multiple vendors Different vendor teams / specializations

Ideaca: Lead AX implementation team, AX project management WellPoint: AFE and Joint Venture Billing Jefferson Wells: CSOX

Reviewed credentials of each vendor team member

Program Manager Responsible for integrating and executing change management plan

throughout overall program Represented Aux Sable’s interests & requirements to the various vendors. Responsible for delivering on scope, on budget and on time. Ensured accuracy, completeness and consistency in all management

project reportingConfidential Slide 18

StructureDevelop a Team Focused Structure

Steering Committee Established a formal steering committee reporting to the project sponsor Multi-country, multi-company, multi-department membership

Project Team Project organization based on need for extensive employee engagement Full time team of internal and vendor staff, all located on-site Relocated US project staff to Canada to ensure effective communications

Vendors Core vendor team (Ideaca) staff full time, on-site Physically integrated with internal project team


SupportInvolve key stakeholders

Identify and seek support from Key Stakeholders Senior mgmt team, audit committee, external auditors, owners, users

Senior accountant / team member transferred to primary support role (1st point of contact)

IT support organizations trained in product support

Implementation vendor (Ideaca) contracted for on-call support

Formal problem escalation procedures implemented


Communications Who

Identified all individuals directly or indirectly affected by change; categorized, built a communication plan for each group

Identified groups or individuals most likely to resist or struggle – worked closely with these people

What For each group, identified and communicated what will change in their job

When Communicated throughout the project, and communicated when the change

would occur. Update regularly How

Multiple approaches – lunch & learns, emails, newsletters, contests etc WHY

Reinforce why the change is necessary, the benefits of change, empathize with those most affected


Control Daily Project Team meetings

15 minute stand-up Daily progress and issue reviews

Weekly Steering Committee Meetings Formal steering committee (reporting to the project sponsor) Progress to plan reviews Major Issues, Decision Requests, Change Requests

Monthly Sponsor / Steering Committee meetings Issue resolution Cost, schedule and scope Progress and forecast to complete

Quarterly Senior Management updates (CEO and Owners) Summary of progress (cost and scheduling vs. budget and timeline)


Education / Training

Identified affected staff

Built educational programs specifically targeted to individual requirements

Just in Time training

Advanced Users – combined training with system testing Provided additional opportunity for employee engagement Encouraged staff to explore / break the system

Post start-up support



Key Challenges / Opportunities

Simultaneous implementation in multiple companies covering two countries (US and Canada)

Development of a common chart of accounts / coding block and common accounting processes for all companies / countries

Interfaces with existing logistics and marketing system

Customizations (accruals)


Key Deliverables Coding Block (Chart of Accounts/ Dimensions)

Supports multiple criteria for tracking and monitoring costs and revenues (dimensions)

Fixed Assets Additions, dispositions, transfers and depreciation calculations

AFE Management Generate / close AFE, track and monitor project progress and

expenditures


Key Deliverables - 2 Project Management

Cost Allocation Overhead Calculations Division of Interest (DOI) Budgets (project)

Increased Reporting flexibility Built-in and 3rd party reporting tools Dimensions: flexibility for a wide variety of mgmt reporting

requirements Dimensions: increased ability to summarize data Drilldown


Key Deliverables - 3 CSOX Controls

Improved CSOX controls through automation and AX security (achieved 10% reduction in manual CSOX controls)

CSOX processes tightly integrated into final solution

Support for Change / Growth Increased functionality supports future business development

initiatives

Integration with Marketing & Logistics System Product related transactions automatically transferred to AX


Results

Implementation project began April 1, 2008 and ran for 11 months.

AX implemented on schedule on January 1, 2009

Project completed under budget

Project completed on schedule on February 28, 2009


Benefits Achieved Process

Reduced coding errors – validation rules Automated processes – significant reduction in time spent vs. manual

process Achieved 10% reduction in manual CSOX controls Shortened month end closing time by 4 business days

Reporting Reduced number of manual spreadsheets for month end reporting – less

time creating reports/more time analyzing results

Platform for Future Growth Subsequently added materials management, purchase order modules Moving forward on Data Architecture and Business Intelligence (BI)


Summary: Key Learning's & Success Factors

Integration of our change management approach throughout the entire initiative (from concept to implementation) helped ensure success

Project approach engaged all levels of staff, was highly communicative with virtually no negative feedback throughout.

Utilized an extensive communication and change management approach to ensure buy-in

Dedicated project team (backfilled)

Co-location of key project team members ensured multi-company / country system requirements were met


Summary: Key Learning's & Success Factors

Managed as a formal program – sponsor, steering committee, external program manager, project manager (Ideaca), project team (Aux Sable & Ideaca)

Implemented auditor feedback from the outset to minimize outside auditor costs and future changes

Developed a monitoring / reporting framework to senior management to ensure alignment of expectations and progress

Project continued for 2 month-ends after go-live (support, bug fixes)

Stabilization project (after implementation) – implemented changes based on initial 4 months of user feedback.


Thank you for your time …….

Documents

Heartland Upgrader Offgas Project Management at Aux... · 2010-05-28 · Confidential Slide 14 Accounting System Replacement Business Drivers for Change Significant commercial contract