Shell Material Groups

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Shell PSGC Product & Service Group Codes

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Product & Service Groups Overview of the presentation • • • • • •

Purpose of PGSC Long term policy Spend collation Vendors linked to PSGC’s Guide lines for use Procedures for Maintenance

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Product & Service Groups Purpose To ensure consistency in business Categorisation of spend analyses throughout the Group MATERIAL REQUEST

Spend Collation • In the Company • In the Group

Material Groups

Vendor List Data base • For Vendor registration and management

ENQUIRY

PURCHASE ORDER

• For Vendor selection in the Company and by Contractors

Definition A Material Group is defined as a generic description for a group of similar services or goods, with the least possible variation, whilst covering the maximal range

The MESC system contains the list of 2400 Material Groups Shell Global Solutions

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Product & Service Groups Long term policy In a few (2-5) years time the Shell PSGC list will be replaced by the UNSPSC codes. At this moment these UNSPSC codes are not yet “fit for purpose”. Until the change to the UNSPSC codes the Shell list will be maintained with as little changes as possible. Accepted changes will be included in the latest list, however only one revision per year is foreseen. Changes will be reported to focal points from EP, OP, Chemicals and JD Edwards (where known). A mapping between the two systems can be made available by SGSI.

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Product & Service Groups Spend Collation Within the Operating Unit

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Analyze the spend for procurement strategies (e.g. Procurement Targeting)

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Standardisation & Variety control exercises

Throughout the Group

• •

To review procurement activities The Service and Product Classes enable spend collation for a range of Service or Product Groups Remark: As the SAP no has taken (partly) over some of the old MESC no functionalities, Standardisation & Variety control will increasingly depend on PSGC reviews Shell Global Solutions

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Product & Service Groups Vendors lists linked to the PSGC To control accepted Vendor listings - e.g. for valves, electrical & instrumentation equipment

To control the Vendor base of the Company per Product or Service Group (Registration) To control sub-contracted spend - Contract procedures should state that PSGC Vendors are to be used within and outside the OU to control the spend and purchases by sub-contactors

To control commodities (e.g. for inspection) such as: -

Technically Critical Chemicals Drilling Equipment Quality Assurance

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Product & Service Groups Guide lines for use Management, engineering, construction services For combined design engineering & main engineering services the Contractor should provide a detailed split up of his activities for Management, Engineering & Construction.

Maintenance services Maintenance services are normally combined with the same group for construction, in order to prevent that many Service Groups are set up twice.

Spare parts Spare parts can be purchased against the relevant main equipment Product Group or alternatively be grouped in a general spare parts Product Group (e.g. 31XXXX).

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Product & Service Groups Maintenance on the PSCS’s New PSGC • The PSGC list is centrally maintained by SGSI. • Local PSGC’s are not encurraged • If a spend > US$ 500,000 is expected, new Groups may be requested. • Requester should explain why an existing group cannot be used. • OU’s create there own PSGC’s within the structure of the first 4 digits. Existing PSGC • Text improvements • PSG code changes

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yes

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no

Issues • It is difficult to distributed changes properly • Changes are not so easy to handle by SAP and JDE systems

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