Rahul Tandon holds an MBA in Marketing and Inter- national Business from SPJIMR and has an engineering background with certifications from London Business School, Cornell University, and MIT. Rahul has been associated with Bharat Petroleum for over 27 years now and has played a significant role in its success story so far.

In conversation with Charulatha, Correspondent, Silicon- india Magazine. Rahul Tandon shared his views on the dynamic toggling feature for scenario analysis within the network planning tool and the data sources that the network planning tool relies on to make its predictions and recommendations.

What was the idea behind the network planning tool, and how is it being used today?
Over the last 10-12 years, India has witnessed massive network expansion in accordance with the growing demand for petrol and diesel. Despite the current energy transition and EVs coming-in, the dependence on liquid fuels will continue to prevail, but not grow as it used to in the past. As a result, you have to ensure that you expand your network based on some value driver for not only the partner or dealer who invests in the facility, but also for the organization to position the product in the most economical way and get the returns on the capital investment. This tool was conceived with the vision to satiate the requirement for an advertisement to be released on an industry basis for another set of expansion across the country. With the help of this tool, we aspire reaching fuel to every customer in the most profitable and convenient way. This tool is used throughout our entire organization, right from our Field Officer to our Territory Managers, State Heads and the headquarter to ensure that we setup our new outlets strictly in line with our corporate objectives.

Briefly explain the functioning of the dynamic toggling feature for scenario analysis within the network planning tool
We have designed this tool keeping in mind not only the network expansion as a response to an advertisement, but with an intention that whenever we are going to add fuel stations to our market going forward, we are mindful in investing our money in setting-up these fuel stations. Since we are operating in a constantly changing business landscape, these changes are being captured in this tool on a continuous basis in a dynamic way. For instance, our PM has laid the foundation for a Rs. 49,000 crore petrochemical complex at out Bina refinery. Once this complex starts to develop over the next 2-3 years, there will be a lot of economic activity, which will change the fuel consumption pattern in that region. When we revaluate a particular market after a few years and identify that there is a requirement for higher CAPEX due to the increased economic activity in the vicinity of that market, this tool will prompt me to put-up additional outlets in that geography. This has been the key advantage that dynamic toggling offers.

As an industry practice between the oil companies, there is a lot of data exchange that happens depending upon the class of the markets on a monthly basis

Tell us about the data sources that the network planning tool relies on to make its predictions and recommendations
As an industry practice between the oil companies, there is a lot of data exchange that happens depending upon the class of the markets on a monthly basis. The same is captured within our tool, through which we derive multiple reports for making informed decisions. For instance, in Chennai city which is a Class-A market, there are a certain number of outlets of all oil companies. However, when you go towards Red Hills or Karanodai, you’ll see that these outlets will have sales for the previous months based on the expansion. This sales data enables us to identify the throughput of Bharat Petroleum as compared to the OMCs in this market. If our representation is less than the OMC, I will then put-up a new outlet in this location on an immediate basis.

"Some of the key parameters that we consider while setting-up a new fuel station are the population density of that location, per capita income, areas with no fuel stations, traffic flow and many others"

In terms of scalability and adaptability, how has the tool been designed to accommodate changes in the business environment and evolving market conditions?
There are no restrictions for this tool and any & every change in the market condition can be adopted through this tool. However, we have created a set of rules to meet our corporate objectives. There are unlimited number of analysis and parameters that we can build in this tool. Also, the government has announced that it will be soon creating transport hubs for which there are already 5-6 locations formed and another 5-6 that are yet to be finalized. Once those locations are formed, we can put a layer of those locations in our tool and then change the priority on whether to put it on a state highway, rural corridor or the city exits.

How does the network planning tool incorporate geographical and demographic data to make informed expansion recommendations?
Some of the key parameters that we consider while setting-up a new fuel station are the population density of that location, per capita income, areas with no fuel stations, traffic flow and many others. We are incorporating all these data points into our tool to get insight-driven expansion recommendations. Most importantly, the tool offers a clear picture of the traffic flow and helps us decide on the kind of outlet to make and where to make it.