JUST over a year ago Messer established a company specifically to manage the cylinder assets within the group and improve the efficiency of the cylinder procurement and internal supply processes to its subsidiaries. Today the new company is enjoying its success and serving its subsidiaries better than ever.
According to Messer GasPack\\$quot;s managing director, Alexander Kriese, cylinder pooling or asset management is part of a more comprehensive plan to optimize the supply chain in order to reduce the total cost, and so far the effort has exceeded all expectations.
He said: \\$quot;There are more than 4000 different cylinder items within the group and that is one of the reasons why the new system will lead to reasonable cost savings by reducing this wide portfolio.
\\$quot;Transactions are challenging,\\$quot; he continued, \\$quot;but the system is working and the subsidiaries have become gradually confident on the benefits of cylinder pooling such as provision of the appropriate amount, size, quality of cylinders through the operational and back up cylinder pooling system and related cylinder services.
\\$quot;End customer demands can be efficiently fulfilled, which can be seen by reduced lead times of new signed contracts,\\$quot; Kriese added.
The objective: to decrease capital assets and reduce costs by 20 per cent.
The backbone of the project dates back to 2001 when the first Messer workshops started to identify new business opportunities. Soon Kriese and his team developed the idea of cylinder pooling and Messer GasPack became a solid business case approved by the company\\$quot;s board of directors in 2004.
Kriese says that there were several drivers that contributed to the project. He continued: \\$quot;Just to give you some examples, rotation figures of same sized cylinders varied from 10 to 100 per cent, which constituted a considerable cost saving potential. Messer subsidiaries across Europe had different needs and tax laws concerning depreciation, especially within the first year, and this didn\\$quot;t motivate subsidiaries to make efficient use of their cylinder pool.
\\$quot;Also cylinder purchasing was conducted by the subsidiaries and not centrally.\\$quot;
The company is responsible for the centralised purchasing of cylinders, valves, regulators and other cylinder items for all of the Messer Group\\$quot;s subsidiaries. Messer GasPack selects preferred suppliers and is responsible for all supplier contacts.
Messer GasPack owns all the cylinder assets within the group and is responsible for the management of the cylinder pool \\$quot;“ which includes the type of cylinder, size, coding and also the reserve pool required to support businesses at short notice. The company also undertakes additional functions, such as cylinder testing, labelling and tracking (bar coding and the IT management of it).
Requirements for additional cylinders or new cylinders are made to Messer GasPack, which then services that request or order.
Kriese continued: \\$quot;Based on those drivers the business case objectives were to be profitable from year one and to handle around two million cylinders across Europe. By 2010, both the cylinder pool and operating cost should be reduced by 20 per cent.\\$quot;
\\$quot;The benefit to Messer\\$quot;s customers will be very visible, in which orders can be efficiently fulfilled with reduced lead time for new contracts. A critical success factor is sound management and good communication within the team at Messer GasPack and with the subsidiary companies,\\$quot; Kriese continued.
Does this stop there with an efficient cylinder supply chain. No \\$quot;“ according to Kriese, the cylinder asset management is part of a more comprehensive plan to optimise the supply chain throughout the company and that CRYO pooling will follow (management of the cryogenic tank and tanker assets).