Strategic Business Development in Malaysia's Oil and Gas Industry

This research paper undertakes a comprehensive review of strategic business development within Malaysia's oil and gas industry, specifically examining the context of Palfinger Asia Pacific Pte Ltd. The study delves into the company's business model, conducting a market analysis to assess strengths, weaknesses, and opportunities within the sector. The research employs both qualitative and quantitative methods, including financial ratio analysis and interviews, to evaluate the company's financial health and market position. The objectives include analyzing Palfinger's business portfolio, assessing the competitive landscape, and evaluating distribution models. The findings highlight the need for strategic business development to enhance growth, providing detailed recommendations for the company's expansion in Malaysia. The paper also provides a literature review, research design, and methodology, including data collection and analysis processes. The study offers valuable insights into the dynamics of the Malaysian oil and gas sector, providing a framework for strategic decision-making and future business planning. The report concludes with recommendations for future business strategies, including structured work procedures and long-term growth initiatives.

Running head: RESEARCH PAPER
Topic: To Review and Propose Strategic Business Development in Malaysia for the Oil &
Gas Sector
Name of the Student:
Name of the University:
Author note:

1RESEARCH PAPER
Acknowledgement
I would like to express my gratitude towards all the people, who have helped me in conducting
my research study on the importance of strategic business development in the oil and gas
industry of Malaysia, in the context of the multinational company, Palfinger Asia Pacific Pte Ltd.
They have helped me in every possible manner to explore my potential and strength and utilize it
in the best manner for conducting the research paper. I also thank my supervisor, who has guided
me through the entire time of the research by providing excellent guidance and monitoring. I also
express my gratitude towards my friends and family who have supported and encouraged me
throughout the research work so that I could complete the study in proper time.

2RESEARCH PAPER
Abstract
This research paper explores the importance of strategic business development in the oil and gas
industry of Malaysia, in the context of Palfinger Asia Pacific Pte Ltd. Oil and gas industry is one
of the most important sectors in Malaysia. It contributes a significant amount of revenue in the
country’s economy. Palfinger Asia Pacific Pte Ltd is a heavy lifting crane and other equipment
supply company that has global business. It is one of the most trusted companies in terms of the
supply of crane and other hydraulic solutions to various industries in the country. In this study,
the researcher collected primary data through structured and unstructured interviews and
secondary data from the annual report of the company. Qualitative and quantitative methods for
financial ratio analysis were applied on the data and it was found that the company is in good
financial health and strategic business development is necessary for expanding its business in the
oil and gas sector of Malaysia.

3RESEARCH PAPER
Table of Contents
CHAPTER 1: INTRODUCTION....................................................................................................6
1.1 Introduction............................................................................................................................6
1.2 Company overview................................................................................................................7
1.3 Research aim..........................................................................................................................8
1.4 Research objectives...............................................................................................................8
1.5 Research questions.................................................................................................................9
1.6 Research rationale..................................................................................................................9
CHAPTER 2: LITERATURE REVIEW.......................................................................................11
2.1 Strategic business development...........................................................................................11
2.3 Review of Business Portfolio and Financial Turnover of Local agent with that of
Palfinger’s Standard...................................................................................................................16
2.4 Strengths, weaknesses and opportunities of the oil and gas industry of Malaysia..............16
2.5 Assess and Compare local competitors on their approach and business strategy to the Oil
and Gas Sector...........................................................................................................................18
2.6 Possibilities for Direct Business in Companies or Business to Business Distribution model
via Local Agent..........................................................................................................................19
CHAPTER 3: RESEARCH DESIGN AND METHODOLOGY..................................................21
3.1 Research philosophy............................................................................................................21
3.2 Research purpose.................................................................................................................22

4RESEARCH PAPER
3.3 Research approach...............................................................................................................22
3.4 Research design...................................................................................................................23
3.5 Data collection process........................................................................................................23
3.6 Sampling technique.............................................................................................................24
3.7 Data analysis process...........................................................................................................25
3.8 Ethical considerations..........................................................................................................25
CHAPTER 4: DATA ANALYSIS AND FINDINGS...................................................................27
4.1 Data analysis and findings...................................................................................................27
4.1.1 Financial ratio analysis for Palfinger Asia Pacific Pte Ltd...........................................27
4.1.2 Qualitative analysis.......................................................................................................33
4.2 Market analysis....................................................................................................................38
4.3 Summary of findings...........................................................................................................41
CHAPTER 5: CONCLUSION AND RECOMMENDATIONS...................................................44
5.1 Linking to the research objectives.......................................................................................44
5.1.1 Linking to the first objective.........................................................................................44
5.1.2 Linking to the second objective....................................................................................45
5.1.3 Linking to the third objective.......................................................................................46
5.1.4 Linking to the fourth objective.....................................................................................47
5.1.5 Linking to the fifth objective........................................................................................47
5.2 Recommendations................................................................................................................48

5RESEARCH PAPER
5.3 Future scope of the study.....................................................................................................50
References......................................................................................................................................51
Appendix........................................................................................................................................57

6RESEARCH PAPER
CHAPTER 1: INTRODUCTION
1.1 Introduction
The oil and gas industry of Malaysia started its operations almost a century ago. Over the
years, the industry has flourished to be one of the most dynamic industries in the country dealing
with the natural reserves of oil and gas. It has also become one of the biggest producers of the
liquefied natural gas (LNG). There are almost more than 3500 oil and gas companies in Malaysia
that includes both the national and international companies. The oil and gas industry of Malaysia
contributes around 20% -30% in the Gross Domestic Product (GDP) (Nikhalat‐Jahromi, Fontes
& Cochrane, 2017.
As the industrial sectors in the global economy are changing quite rapidly and bringing
different dimensions to the businesses, it is highly important for the organizations in every
industry to stay relevant to the industrial needs and the market demands. The business
implications have a profound impact on the organizations to stay competitive and sustainable at
the same time for achieving long term growth (Ngoasong, 2014). Hence, it is extremely essential
for the organizations to understand the principles of the market and develop strategies
accordingly to not only gain a competitive edge in the market but also for sustaining in the long
term. It is seen usually seen that the businesses adopt strategies that directly or indirectly reflect
the national culture and the value that it delivers to the customers. Thus, any strategic business
development should adopt business models that explore the relationships between the nature of
the business, culture, innovative management and proposed value of the organization to deliver
the best outcome (França et al., 2017).

7RESEARCH PAPER
Business development depends on quite a few important factors, namely, communication,
cross channel marketing, remote working, and storytelling technique for brand promotion. The
main motive of strategic business development is to create long term relationship with the proper
demographic of the society and proposing the best value to the customers and in turn earning
profit (Björkdahl & Holmén, 2013). Strategic business development helps the organization to
find out the USP of its product, service or idea and create a business plan around it. This process
is followed in all the industries or sectors.
This study aims to review and propose strategic business development in the oil and gas
industry of Malaysia. The case of Palfinger Asia Pacific Pte Ltd in Malaysia will be chosen to
conduct this study. The business model of this company will be reviewed to explore the different
aspects of the company which are relevant for the industry. A comprehensive literature review
will be conducted to create a conceptual context for the study. It will focus on the business and
financial portfolio of Palfinger Asia Pacific Pte Ltd in Malaysia to compare the industry
scenario.
1.2 Company overview
Palfinger Asia Pacific Pte Ltd is one of the major lifting solution providers in Malaysia.
The company provides highly innovative, cost effective and reliable hydraulic lifting solutions in
the commercial vehicle industry and in the maritime field. In Malaysia, the company offers
products like loader cranes, marine cranes, Epsilon timber and recycling cranes, davit system,
tail lifts, access platforms, mobile cranes, passenger lifts, truck bodies, railway systems, rope
access professionals and truck mounted forklifts. It also offers tools and equipment for

8RESEARCH PAPER
improving the efficiencies of its cranes. Hydraulic Loader Crane is its most popular product,
which is known for high efficiency and user friendliness. Palfinger has more than 120 products
in its portfolio and has more than 30% market share and it is one of the market leaders in the
world in this segment (Palfinger.com, 2019). The company has been signed for supplying
complex offshore hydraulic cranes to Dong for the exploration and production operations on the
Danish Hejre Field. Palfinger has been able to establish a position in the marine industries and in
the oil and gas industries in European countries by providing highly advanced deck winches and
lifting equipment, bulk handling equipment, bunker etc. The winches of the company are electric
and have controlled frequency. Palfinger wants to expand its business in the oil and gas industry
of Malaysia by offering its world class lifting products.
1.3 Research aim
The aim of this research paper is to study and review the existing business model of
Palfinger Asia Pacific Pte Ltd in Malaysian Oil and Gas industry to evaluate the current business
scenario of the industry and to provide recommendations to the company to install the future
growth drivers.
1.4 Research objectives
The objectives of the research study are stated below:
 To analyze and review business portfolio and financial turnover of current Local agent in
Malaysia in accordance to Palfinger’s Standards as Principle
 To conduct a market analysis studies on the strength, weakness and potential opportunities
in the Oil and Gas sector of Malaysia

9RESEARCH PAPER
 To assess and Compare local competitors on their approach and business strategy to the Oil
and Gas Sector
 To evaluate possibilities for a direct Business to Companies or Business to Business
distribution model using a local agent
 To propose structured and improved work procedure and future business strategy for long
term growth
1.5 Research questions
1) What is the business portfolio and current financial status of the Palfinger Asia Pacific
Pte Ltd in Malaysia?
2) What are the strengths, weaknesses, and potential opportunities of the oil and gas
industry in Malaysia?
3) What are the possibilities for direct B2C or B2B distribution model in this industry using
a local agent?
4) How to improve the growth strategy for the Palfinger Asia Pacific Pte Ltd to expand its
business in Malaysia?
1.6 Research rationale
The significance of this research lies in the fact that this study will contribute
significantly in both the academic world and in the corporate world. Firstly, the study will make
additions to the literature world by highlighting different aspects of the research topic. The
relationship between business portfolio and the strengths, weaknesses and opportunities will be
examined to highlight the future growth potential. This will help the future researchers and the
oil and gas sector as well for further research. The study will illustrate the necessity of the
strategic business development in the oil and gas companies in the Malaysian oil and gas sector.

10RESEARCH PAPER
The study will be conducted in an extensive manner to assess the buying patterns and trends of
the customers and to determine the strengths and weakness of the market. The study will
examine the market competition scenario to assess the possibilities for growth in this market for
Palfinger Asia Pacific Pte Ltd. Based on the findings, the need for strategic business
development will be suggested for Palfinger Asia Pacific Pte Ltd and the ways to implement
those strategies in the most effective manner. Thus, the study will be beneficial for the oil and
gas companies which would want to expand its businesses in an established market and thus
need to focus on strategic business development.

11RESEARCH PAPER
CHAPTER 2: LITERATURE REVIEW
This chapter presents an overview of the literatures that dealt with the strategic business
development and its various aspects. This would help the researcher to create a context for the
specific research study, that is, importance of the strategic business development in the oil and
gas sector of Malaysia. This would also help the readers to get acquainted with the broad
research subject and the research topic. This chapter will contain a thorough discussion on the
relevant peer reviewed journal research papers and other relevant sources of information to
highlight the broader aspect of the research study and to determine the research variables.
2.1 Strategic business development
As stated by Lee et al. (2015), business development refers to the method of identifying,
nurturing and acquiring new business clients and driving the business opportunities towards
profitability and growth. Business strategy represents the process of documenting the plans and
actions of the organizations for developing the business. The scope of the business development
includes broad range and it varies from one organization to another. Morden (2016) writes in his
book that strategic business development includes various combinations of different individual
tasks with a goal to implement and develop the growth opportunities within the organization
itself or between two or more business organizations. It leads to the all round development of the
business to make the operations more efficient and increase the value proposition to the
customers. In other words, strategic business development aims to establish long term value
factor for the organization by considering the market demands and positions, customer positions
and the interrelationships.