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Kinaxis, ExxonMobil teaming up to develop supply-chain software for energy sector

October 15, 2024

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Kinaxis is teaming up with oil and gas giant ExxonMobil to develop supply chain management software designed specifically for energy customers, the companies announced Tuesday. Kinaxis will work with ExxonMobil to “identify supply chain challenges unique to the energy sector and create a potential industry solution to mitigate them,” the Kanata-based tech firm said in a news release. Kinaxis said the fuel commodities market currently “relies heavily on spreadsheets and other manual methods” for gauging supply and demand. The new software solutions created by Kinaxis and ExxonMobil will help energy companies improve their inventory management and save on sourcing, storage, shipping and other costs, the release added. “ExxonMobil is uniquely placed to understand the biggest opportunities in improving energy supply chains, from more accurate sales and operations planning, increased agility in field operations, effective management of enormous transportation networks and adapting quickly to complex regulatory environments,” Kinaxis chief executive John Sicard said in a statement. “There is an urgent need to increase efficiency in every step, from extraction to end-user consumption, and we’re looking forward to making a big impact across the sector.” Staale Gjervik, supply chain president, ExxonMobil Global Services Company, said the agreement will be “instrumental” in helping large oil and gas producers become more efficient. Founded in 1984, Kinaxis is a global leader in software that helps manufacturers keep track of their supply chain systems in real time. Its customers include Procter & Gamble, IBM, Lockheed Martin and Volvo. Since Sicard took over as chief executive in 2016, Kinaxis’s annual revenues have quadrupled to more than US$400 million, while the company’s headcount has grown more than 400 per cent and its market valuation has tripled as demand for its platform has skyrocketed. But the agreement with ExxonMobil comes amid turbulent times for Kinaxis. The firm’s share price has stagnated over the past year amid economic headwinds that have slowed sales cycles. In August, Kinaxis said its revenues for fiscal 2024 would likely come in at the lower end of its projected range of US$483 million to $495 million. Meanwhile, the company’s C-suite is in a state of flux. In a surprise announcement in late August, Kinaxis said Sicard would retire at the end of the year and chief sales officer Claire Rychlewski would be leaving the company in November after less than a year in her current role. In addition, a number of other key executives, including former president Paul Carreiro, chief strategy officer Anne Robinson, chief marketing officer Margaret Franco and vice-president of key accounts David Anderson, have also left the company since the start of 2024. Two major investors have since called for Kinaxis’s board of directors to pursue new ownership for the company, which announced last month it had hired Goldman Sachs to advise it on maximizing its value to shareholders. Kinaxis shares were down $1.03 to $157.04 in late-afternoon trading Tuesday on the Toronto Stock Exchange.