Report Strategic Management 2022
Added on 2022-02-28
30 Pages5996 Words21 Views
MBA - Strategic management
1 | P a g e
Strategic Plan for Sapura
Energy Berhad
2019
1 | P a g e
Strategic Plan for Sapura
Energy Berhad
2019
MBA - Strategic management
2 | P a g e
Contents
1.0 Introduction ................................................................................................................................ 4
1.1 Main objectives of report ....................................................................................................... 4
1.2 Background information SEB .................................................................................................. 4
1.3 Current strategic challenge in SEB .......................................................................................... 5
1.4 The vision, mission and objectives statements of SEB ........................................................... 5
1.5 Effect of vision/mission statement on SEB’s objectives ......................................................... 6
1.6 Focus, Clear and motivating analysis ...................................................................................... 6
2.0 PESTEL analysis............................................................................................................................ 8
3.0 Porter’s 5 forces of Malaysia energy sector .............................................................................10
4.0 Capability analysis.....................................................................................................................13
4.1 Value chain – Primary activities of SEB .................................................................................13
4.2 Resource audit ......................................................................................................................16
4.3 VRIO and value chain analysis...............................................................................................17
4.4 Key performance indicators..................................................................................................17
5.0 Strategies ..................................................................................................................................18
5.1 SWOT.....................................................................................................................................18
5.2 TOWS.....................................................................................................................................20
5.3 Ideal strategies......................................................................................................................22
5.3.1 Market penetration.......................................................................................................22
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Contents
1.0 Introduction ................................................................................................................................ 4
1.1 Main objectives of report ....................................................................................................... 4
1.2 Background information SEB .................................................................................................. 4
1.3 Current strategic challenge in SEB .......................................................................................... 5
1.4 The vision, mission and objectives statements of SEB ........................................................... 5
1.5 Effect of vision/mission statement on SEB’s objectives ......................................................... 6
1.6 Focus, Clear and motivating analysis ...................................................................................... 6
2.0 PESTEL analysis............................................................................................................................ 8
3.0 Porter’s 5 forces of Malaysia energy sector .............................................................................10
4.0 Capability analysis.....................................................................................................................13
4.1 Value chain – Primary activities of SEB .................................................................................13
4.2 Resource audit ......................................................................................................................16
4.3 VRIO and value chain analysis...............................................................................................17
4.4 Key performance indicators..................................................................................................17
5.0 Strategies ..................................................................................................................................18
5.1 SWOT.....................................................................................................................................18
5.2 TOWS.....................................................................................................................................20
5.3 Ideal strategies......................................................................................................................22
5.3.1 Market penetration.......................................................................................................22
MBA - Strategic management
3 | P a g e
5.3.2 Market development ....................................................................................................24
6.0 Strategy evaluation – Conclusions ............................................................................................25
References ............................................................................................................................................28
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5.3.2 Market development ....................................................................................................24
6.0 Strategy evaluation – Conclusions ............................................................................................25
References ............................................................................................................................................28
MBA - Strategic management
4 | P a g e
1.0 Introduction
1.1 Main objectives of report
This report is a strategic plan for Sapura Energy Berhad (SEB). The mission, vision
and objectives statements of the organisation will be analysed using the three criteria
Focus, Clear and Motivation. Macro environmental analysis will be conducted using
the PESTEL model while micro industry analysis will be conducted using Porter’s 5
forces model. Internal capability of Sapura Energy Berhad will be analysed with aid
of Value Chain model. Solutions to current issues facing Sapura Energy Berhad will
be proposed using the TOWS and Ansoff matrix. Evaluation of the proposed
strategies will be analysed using the Suitability Acceptability and Feasibility model.
Industry Key Performance Indicators analysis will be examined by benchmarking
Sapura Energy Berhad versus Dialog Group Berhad – a close competitor.
1.2 Background information SEB
Sapura Energy Berhad (SEB) is a leading global integrated oil and gas services and
solutions provider operating across the entire upstream value chain
(https://sapuraenergy.com/, 2019). The company’s spectrum of capabilities covers
the exploration, development, production, rejuvenation, as well as decommissioning
and abandonment stages of the value chain. With a highly skilled and technically
capable multinational workforce, strategic world-class assets, and strong project
management capabilities, the company today has a global presence in over 20
countries (https://sapuraenergy.com/, 2019). SEB made the prestigious Forbes
Asia’s Fabulous 50 listing for the second successive year, demonstrating its
commitment to excellence in all aspects of its business. The company was also
voted Asia’s Overall best managed company in Natural Resources for 2014 in a poll
conducted by the international financial publication, Finance Asia
(https://sapuraenergy.com/, 2019).
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1.0 Introduction
1.1 Main objectives of report
This report is a strategic plan for Sapura Energy Berhad (SEB). The mission, vision
and objectives statements of the organisation will be analysed using the three criteria
Focus, Clear and Motivation. Macro environmental analysis will be conducted using
the PESTEL model while micro industry analysis will be conducted using Porter’s 5
forces model. Internal capability of Sapura Energy Berhad will be analysed with aid
of Value Chain model. Solutions to current issues facing Sapura Energy Berhad will
be proposed using the TOWS and Ansoff matrix. Evaluation of the proposed
strategies will be analysed using the Suitability Acceptability and Feasibility model.
Industry Key Performance Indicators analysis will be examined by benchmarking
Sapura Energy Berhad versus Dialog Group Berhad – a close competitor.
1.2 Background information SEB
Sapura Energy Berhad (SEB) is a leading global integrated oil and gas services and
solutions provider operating across the entire upstream value chain
(https://sapuraenergy.com/, 2019). The company’s spectrum of capabilities covers
the exploration, development, production, rejuvenation, as well as decommissioning
and abandonment stages of the value chain. With a highly skilled and technically
capable multinational workforce, strategic world-class assets, and strong project
management capabilities, the company today has a global presence in over 20
countries (https://sapuraenergy.com/, 2019). SEB made the prestigious Forbes
Asia’s Fabulous 50 listing for the second successive year, demonstrating its
commitment to excellence in all aspects of its business. The company was also
voted Asia’s Overall best managed company in Natural Resources for 2014 in a poll
conducted by the international financial publication, Finance Asia
(https://sapuraenergy.com/, 2019).
MBA - Strategic management
5 | P a g e
1.3 Current strategic challenge in SEB
As shown on figure 1.0 below, SEB witnessed a significant decline in revenue in the
last 3 years from 2016 to 2018. Between FYE 2016 and 2017 revenue declined by
25% while it was 23% decline between FYE 2017 and 2018. This has led to loss
before tax and impairments of RM191 million in the FYE 2018 as well as Rm2.5
billion loss after tax (https://sapuraenergy.com/ , 2019).
Figure 1.0 Current strategic challenge of SEB: Source: (https://sapuraenergy.com/ , 2019).
1.4 The vision, mission and objectives statements of SEB
Vision, mission statement of SEB is “to be the best entrepreneurially led
technically competent and most trusted global Oil and Gas Company in the eyes of
our customers, shareholders and most importantly, our empowered people.”
(https://sapuraenergy.com/, 2019).
Core Values statement of SEB – “We will be guided by our honesty, trust and
respect for all. We will achieve our business objectives by being safe, agile and
professional to continuously strive to meet all of our stakeholders’ expectations.”
(https://sapuraenergy.com/, 2019).
5 | P a g e
1.3 Current strategic challenge in SEB
As shown on figure 1.0 below, SEB witnessed a significant decline in revenue in the
last 3 years from 2016 to 2018. Between FYE 2016 and 2017 revenue declined by
25% while it was 23% decline between FYE 2017 and 2018. This has led to loss
before tax and impairments of RM191 million in the FYE 2018 as well as Rm2.5
billion loss after tax (https://sapuraenergy.com/ , 2019).
Figure 1.0 Current strategic challenge of SEB: Source: (https://sapuraenergy.com/ , 2019).
1.4 The vision, mission and objectives statements of SEB
Vision, mission statement of SEB is “to be the best entrepreneurially led
technically competent and most trusted global Oil and Gas Company in the eyes of
our customers, shareholders and most importantly, our empowered people.”
(https://sapuraenergy.com/, 2019).
Core Values statement of SEB – “We will be guided by our honesty, trust and
respect for all. We will achieve our business objectives by being safe, agile and
professional to continuously strive to meet all of our stakeholders’ expectations.”
(https://sapuraenergy.com/, 2019).
MBA - Strategic management
6 | P a g e
1.5 Effect of vision/mission statement on SEB’s objectives
An organization’s “credo”, “philosophy”, “core values”, “reason for being”, “image
creator”, or “a distinctive factor” are frequently used concepts that describe the
importance and the value of a mission statement for an organisation (Dermol and
Breznik, 2012). The vision/mission statement of SEB is reflected in its objective of
maintaining high standards in Health, Safety and Environment (“HSE”) in its
operations including that of subsidiaries. The company stated that it is committed to
its Group’s vision of being safe, agile and professional, which includes responsibly
managing risks within all operations. The company execute its work with integrity,
honesty and in partnership with all stakeholders; focusing on the health and safety of
its employees and the protection of the environment in which it operates from
(https://sapuraenergy.com/, 2019).
1.6 Focus, Clear and motivating analysis
Three principles are helpful in creating meaningful vision, mission and values
statements (Johnson et al., 2016). Focus – statements should focus attention and
help guide real decisions. What is included and excluded in the company’s strategy
should be defined (Johnson et al., 2016). The mission, mission statement of SEB
is relatively focused as it stresses its global market; industry as well as all important
stakeholders - customers, shareholders and most importantly, employees. Mission
statement represents a communicational tool through which management beliefs,
perspectives, and approaches are passed to employees and other stakeholders
(Hirota et al., 2010). The mission’s role is to answer two questions: what is the
company’s business and what it should be (Dermol and Breznik, 2012).
Motivational – statements should motivate employees to do their best. The
statement should be distinctive and authentic. To motivate vision, mission and
values statements should stretch organisational performance to higher levels and set
credible targets (Johnson et al., 2016). The mission, mission statement of SEB
can be said to be motivational as it emphasises the “to be the best entrepreneurially
led technically competent and most trusted global Oil and Gas Company”. It also
emphasise the importance of its workforce in delivering its goals. Studies have
6 | P a g e
1.5 Effect of vision/mission statement on SEB’s objectives
An organization’s “credo”, “philosophy”, “core values”, “reason for being”, “image
creator”, or “a distinctive factor” are frequently used concepts that describe the
importance and the value of a mission statement for an organisation (Dermol and
Breznik, 2012). The vision/mission statement of SEB is reflected in its objective of
maintaining high standards in Health, Safety and Environment (“HSE”) in its
operations including that of subsidiaries. The company stated that it is committed to
its Group’s vision of being safe, agile and professional, which includes responsibly
managing risks within all operations. The company execute its work with integrity,
honesty and in partnership with all stakeholders; focusing on the health and safety of
its employees and the protection of the environment in which it operates from
(https://sapuraenergy.com/, 2019).
1.6 Focus, Clear and motivating analysis
Three principles are helpful in creating meaningful vision, mission and values
statements (Johnson et al., 2016). Focus – statements should focus attention and
help guide real decisions. What is included and excluded in the company’s strategy
should be defined (Johnson et al., 2016). The mission, mission statement of SEB
is relatively focused as it stresses its global market; industry as well as all important
stakeholders - customers, shareholders and most importantly, employees. Mission
statement represents a communicational tool through which management beliefs,
perspectives, and approaches are passed to employees and other stakeholders
(Hirota et al., 2010). The mission’s role is to answer two questions: what is the
company’s business and what it should be (Dermol and Breznik, 2012).
Motivational – statements should motivate employees to do their best. The
statement should be distinctive and authentic. To motivate vision, mission and
values statements should stretch organisational performance to higher levels and set
credible targets (Johnson et al., 2016). The mission, mission statement of SEB
can be said to be motivational as it emphasises the “to be the best entrepreneurially
led technically competent and most trusted global Oil and Gas Company”. It also
emphasise the importance of its workforce in delivering its goals. Studies have
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