Abu Dhabi Oil Refining Company is an oil and gas manufacturing organization, which is located in UAE. The organization has brought about different changes in the operations to enhance the profitability and marketing perspectives of the business. On the other hand, the business holds strong bonds with the stakeholders, as it will be helping the same in maintaining the efficacy of the operations relating to vast value chain. However, in the recent years the organization has faced issues relating to the diminishing quality of the product offerings, which has affected the brand name of the same while operating in different global markets. The purpose of the report is to undertake a detailed analysis of the operations that are undertaken by the concerned organization and thereby suggest strategies in order to resolve the issues that are faced by the same.
Background to the organization and its operational issues
Abu Dhabi Oil Refining Company is an UAE based organization, which offers
crude oil, natural gas and Petrochemicals as per the demand faced by the same in the international markets. The organization is counted among seventh-largest reserves of oil in the world through its holdings of 97.8 billion barrels. The organization stands to be twelfth largest oil company by production accounting to 3.1 million barrels per day (Rui et al., 2017). The revenue of the organization is estimated to be US$60 billion as compounded by the end of the fiscal year 2017. The growth of the organization is specifically depending on the product diversification strategies that are undertaken by the same. It has helped the organization in achieving a unique selling proposition while operating in diverse market structures. The organization played a major role in managing hydrocarbons on behalf of the government. It has helped in the catalytic development of the nation (adnoc.ae 2018).
The different issues that are faced by the organization are based on the fluctuations in the global economies and the complex nature of international and national frameworks. Different technologies that are implemented by organizations have helped the same in upholding the efficacy of performance while working in diverse international markets. Yusuf et al., (2014) stated that the government regulations on the carbon emissions relating to the ever changing regulatory frameworks, which has restricted the operations of the business. On the other hand, the excessive competition in the industry has affected the position of the business while operating in diverse economies.
Abu Dhabi Oil Refining Company faced issues in monitoring over the different activities that are undertaken by the workforce due to the complex nature of the same. The complexity of the activities has resulted to different issues in monitoring over the functions and thereby controlling the same. The complexity of the functions affected the performance of workers while operating as per the objectives of the business. The diminishing rate of product price by 50% has affected the operations of the business. The operating costs have exceeded with the diminishing price of the oil and gas products, which has resulted to loss of the organization (adnoc.ae 2018). The organization operates in diverse economies prone to price and resource fluctuations which has affected the smooth functioning of the same. On the other hand, lack of proper collaboration with different oilfield services has affected the globalized operations of the same.
Strategies required to be applied
Abu Dhabi Oil Refining Company must undertake altered strategies in order to resolve the issues that are encountered by the business while operating in diverse economies. The organization might undertake different cost- cutting strategies in order to enhance the operations and product development stages while operating in economies that experience fluctuations. The operational costs that are undertaken by the organization is related to the cost of raw materials and the labour supplies. Automation of the different processes will be helping the organization in minimizing the different costs relating to the human workforce. On the other hand, the optimization of the operations will be facilitating the productivity pof the same while competing in diverse economies.
Moreover, the concerned organization must undertake suitable performance indicators and monitoring processes in order to enhance the business functioning as per the needs of the same. The concerned organization must take steps to develop certain assessment programs in order to identify the flaws in the complex operational frameworks. On the other hand, undertaking assessment of different business environments will be helping the management in facilitating the investment procedure. Rui et al., (2017) stated that collaborations with diverse foreign organizations help businesses in improving their situation in the global markets through expansion of the same. As per the case, the concerned organization must undertaker active collaboration with different oil and gas reserves, which will be helping the business in facilitating wide expansion and minimize risks of the same. Harhara, Singh and Hussain (2015) stated that the improvements in the business processes helped organizations in undertaking the different modifications in the situation of the same in diverse global economies. The concerned organization might take steps to bring forth changes in the business processes and the value chain networks. Moreover, the organization must also undertake steps to build on the communicability of the same while operating in diverse economies. Rui et al., (2017) stated that enhanced communication of businesses helps the same in undertaking the smooth operations of businesses. Therefore, the enhanced communication of businesses helps in upholding the efficacy of the functions as per the objective of the same.
In conclusion, it can be mentioned that global oil and gas sector is highly dynamic due to the changing trends of economies, political agenda and fluctuation in demands, thereby, it is worth stating that no long-term strategy might work effectively. It is also worth mentioning that increasing pressure which is being leveraged on oil and gas organization as the consequence of significant asset as well as environmental asset, decreasing the performance, increasing cost and more frequent drop’s in the pressure. Thus, businesses in the sector must have to take the actions that are ready and swift in nature. The existing economic climate has provided the essential focus on operational excellence along with the platform of technologies in the operation.
Harhara, A. S., Singh, S. K., &Hussain, M. (2015). Correlates of employee turnover intentions in oil and gas industry in the UAE. International journal of organizational analysis, 23(3), 493-504.
Rui, Z., Li, C., Peng, F., Ling, K., Chen, G., Zhou, X., & Chang, H. (2017). Development of Industry performance metrics for offshore oil and gas project. Journal of Natural Gas Science and Engineering, 39, 44-53.
Adnoc.ae. (2018). ADNOC - Abu Dhabi National Oil Company. Retrieved from https://www.adnoc.ae/
Yusuf, Y. Y., Gunasekaran, A., Musa, A., Dauda, M., El-Berishy, N. M., &Cang, S. (2014). A relational study of supply chain agility, competitiveness and business performance in the oil and gas industry. International Journal of Production Economics, 147, 531-543.