Strategic Business Development in Malaysia Oil & Gas Sector Review

This report provides a comprehensive review and proposes strategic business development approaches for the oil and gas sector in Malaysia, focusing on Palfinger Asia Pacific Pte Ltd's potential growth. It includes a literature review covering strategic business development principles, Palfinger's role in the industry, and an analysis of the Malaysian oil and gas market, including strengths, weaknesses, and opportunities. The report explores possibilities for direct business models versus utilizing local agents, and proposes future business strategies for long-term growth. The research employs an epistemology research philosophy with an interpretivism stance, utilizing a deductive methodology and qualitative data collected through interviews with management officials in Malaysian oil and gas companies. The research design and methodology section details the approach to data collection and analysis, with a focus on gathering insights from key industry players to inform strategic recommendations. The report concludes by emphasizing the importance of adapting to market demands and fostering sustainable business practices within the competitive oil and gas landscape.

Running head: POSTGRADUATE PRACTICE REPORT
Postgraduate Practice Report
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Table of Contents
2. Literature Review........................................................................................................................2
2.1 Introduction of Strategic Business Development..................................................................2
2.2 Introduction of Palfinger Asia Pacific Pte Ltd for Oil and Gas Industry in Malaysia...........3
2.3 Business Portfolio and Financial Turnover of Local agent with that of Palfinger’s Standard
.....................................................................................................................................................4
2.4 Market Analysis on Strength, Weakness and Potential opportunities of Oil and Gas sector
in Malaysia...................................................................................................................................5
2.5 Possibilities for Direct Business in Companies or Business to Business Distribution model
via Local Agent............................................................................................................................5
2.6 Work Procedure and Future Business Strategy for Long-term Growth................................6
3. Research Design and Methodology.............................................................................................7
4. Research Plan...............................................................................................................................8
Conclusion.......................................................................................................................................9
References......................................................................................................................................10

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Title: To Review and Propose Strategic Business Development in Malaysia for the
Oil & Gas Sector
2. Literature Review
2.1 Introduction of Strategic Business Development
According to Lee et al. (2015), business development is considered as a process which
are used for identifying, nurturing as well as acquiring the new clients and the business
opportunities that brings profitability and growth. The strategy of business development is
mainly described as a strategy that is used to accomplish the aim. The main scope of the business
development has wide range and differs lot from one organization to another. The marketing
funnel that business use for developing its market value is shown below.
The below figure 1 shows three different stages of the marketing funnel model. The first
stage I the figure describes Attracting Prospects and Build Engagement. These two are the
functions of traditional marketing. The last stage is the Turning Opportunities into Clients. The
last stage is the function of traditional sale. In this traditional role, the business development
mainly looks for new distribution channels or introduces new marketing partners.

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Figure 1: Three stages of Marketing Funnel
(Source: Nikhalat‐Jahromi, Fontes & Cochrane, 2017)
The roles in the business development keeps on changing and the conventions of name
evolves. There are many firms that refers the entire marketing as well as includes the sales
process in the business development process.
2.2 Introduction of Palfinger Asia Pacific Pte Ltd for Oil and Gas Industry in
Malaysia
Palfinger is the leading manufacturer for highly reliable, customized, deck equipment,
innovative lifesaving equipment, innovative and handling solution for all maritime industries.
The company provides products cranes, winches, handling equipment and lifesaving equipment
(Nikhalat‐Jahromi, Fontes & Cochrane, 2017). This provides a service network that supplies
spare parts ensuring professional as well as onsite support. Recently, Palfinger has been signed
with a contract for providing 28 cranes to the Malaysia. Palfinger is to provide complex offshore
cranes that are to be delivered to DONG for the operation on Danish Hejre Field.

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For the oil and gas industry in Malaysia, Palfinger provides winches as well as offshore
equipment (Lee et al. 2015). Palfinger has set up a strong and unique place in the marine
industries and the Oil and gas industries by designing as well as developing deck winches and
also provides lifting equipment, bunker and bulk handling equipment for the oil and gas sector.
The winches provided by Palfinger are electric and has controlled frequency or is hydraulic
driven (Umar, Jennings & Urmee, 2014). The oil and gas industries also needs customized
offshore as well as marine cranes that are provided by the Palfinger group.
2.3 Business Portfolio and Financial Turnover of Local agent with that of
Palfinger’s Standard
From the studies, it can be said that with price of oil crashing, the industry of oil and gas
decreased by about 11% (George et al., 2016). The overall marginal growth of the oil and gas
production is declining. The strategy of securing the energy of Malaysia is exporting sweet crude
oil to Tapis and includes importing low grade oil for refining the downstream facilities. But,
recently Malaysia is working to increase the refining capacity for becoming a product exporter of
oil. The PIPC (Pengerang Integrated Petroleum Complex) established in Johor as well as the
Sipitang Oil and gas Industrial Park (SOGIP) situated in Sabah is expected to double the capacity
of refining nationwide from amount of 588,000 bbl/d to 1,158,000 bbl/day (Ngoasong, 2014).
As stated by Solarin & Shahbaz, (2015), with the expanded facilities of LNG in Johor
and in Sabah, the oil and gas industries in Malaysia is to gain small amount of increments or can
also lose share markets because of the tough competition from other exporting countries (Bong et
al., 2017). With more than 3,500 number of oil and gas companies situated in Malaysia includes
international as well as local companies there is a multiplier effect in this sector is the size and

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this is recognized by PETRONAS (Petroliam Nasional Bhd) and the government of Malaysia as
the most strategic and the priority sector.
2.4 Market Analysis on Strength, Weakness and Potential opportunities of Oil and
Gas sector in Malaysia
According to Kardooni, Yusoff & Kari (2015), the strength of Oil and Gas industries in
Malaysia are they helps in reserving high quality of oil provides deemed light as well as sweet.
He also stated that the Malaysian oil and gas industries is considered as the net exporter of oil.
This industry in Malaysia is one of the largest country that produces LNG. The author also
stated that this market is well supported by the auxiliary industry in Malaysia.
Defending all the strengths of Oil and gas sector, Ablo & Overå, (2015) stated the
weakness of the Oil and Gas industries in Malaysia. According to the author there is a shortage
of the talents required along with sufficient skills. He also stated that there are many producing
fields that are immature. For the upstream activities, there are high capital outlay.
Ablo & Overå, (2015) also stated the potential opportunities related with the market
analysis of the oil and gas industry in Malaysia. All deep water potential are usually
underexplored according to the author. The marginal fields can hold all undiscovered potential as
a technology progresses. According to the author there is an opportunity to shift the attention by
all larger oil companies to all developed markets that provides the field opportunities for all
smaller independents based on locals. The tax incentives are mainly given by the government.
2.5 Possibilities for Direct Business in Companies or Business to Business
Distribution model via Local Agent

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According to Reddy & Xie (2017), in Southeast Asia, Malaysia is the second largest
producer of oil and gas and the largest exporter of LNG (Liquefied Natural Gas). The offshore
blocks of Malaysia has two different distinct areas known as Peninsular Malaysia and the east
Malaysia. The oil production of Malaysia comes from Tapis Oil Field in offshore Malay basin
(Saad, Mohamed Udin & Hasnan, 2014). The oil reserves of Tapis are very high quality and is
most expensive in whole world.
The cost of oil and gas has decreased over the years which have impacted the national as
well as international companies that deals with oil exportation and production (Bujang, Bern &
Brumm, 2016). Based on the forecast production levels as well as other discoveries, Malaysia
mainly has liquid production or reserves and also has liquid reserves and produces them in
between 10 years to 15 years.
2.6 Work Procedure and Future Business Strategy for Long-term Growth
The cost management is considered as the topmost priority for about 60 % of the
professionals involved in the oil and gas sector in Malaysia (Foo, 2015). About 34 % of the total
respondents in Malaysia prioritizes the headcount reduction so that they can impose more strict
cost control (Basri, Ramli & Aliyu, 2015). Majority of the Malaysian respondents feels that the
oil and gas industry is taking short term on headcount. The skills or career developments are also
decreasing compared to global average which comes to 51 % to 43 %. Almost 58 % of the
respondents believed that the industry is making mistake again and again that were made before
downturns (Raut, Narkhede & Gardas, 2017). The complexity, standardization and the
collaboration that can put the industry on sustainable path. The decrease in oil price impacts the
Malaysian Market. The industry of oil and gas industry has implemented many cost cutting
measures and they will have to accelerate changes that are healthy to cost management.

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3. Research Design and Methodology
The research paper that is carried out to analyze the topic “To Review and Propose
Strategic Business Development in Malaysia for the Oil & Gas Sector”, the research philosophy
that will be carried out will be epistemology research. In epistemology research philosophy, the
researcher accepts all the knowledge and the addresses that are included in the research topic. In
this research philosophy, there are possibilities, limitations and all sources are considered while
carrying out the research study. Knowledge from different sources are explained in the
epistemology research philosophy (Mackey & Gass, 2015). The stance of research philosophy
that will be used for carrying out this research paper is interpretivism philosophy stance. In
interpretivism research stance, there is an involvement of the cultural life and the social life in
the research study. The research approach that will be used for analyzing the research study is
deductive methodology. In deductive methodology, meaning of the questions that are stated for
carrying out the research study is stated.
The data collection method that is used for this research study is primary data
collection method. The strategy that is used for collecting data is in the form of interview. The
interviews that are to be carried out, the questions are asked to the management officials of the
Local agents in Malaysia. The data that are to be gathered are qualitative data which are to be
interviewed to the Finance Manager, Managing Director or the Business Development Manager
of all the companies that are taken under research (Mackey & Gass, 2015). For gathering the
information, oil and gas industries are to be considered for carrying out the interviews. As
qualitative data collection method will be used for carrying out this research paper, data analysis
will be done accordingly. The sample size of the research that is to be carried out is 10
responses. 10 managers are to be interviewed from different oil and gas companies in Malaysia

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and those data are analyzed in this research study. The time horizon for this research paper is
cross-sectional methodology.
4. Research Plan
Activities November December January February March April May
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Reviewing
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Conclusion
With the vast change in the economy of industries, more importance is given to the
marker demands. The increase in market demands have increased the impacts of the corporations
to become very much competitive and needs to survive for long term. The industries in the
market needs to go beyond the principals of the company to be established in the market and
meet the demands of the customers by providing them with very high quality of products. All
such business requirements that are needed for a business are explained in this report.
Development of business can be done in different ways and strategies related to the corporate
world were also explained clearly in this research report. This would help the companies to
remain sustainable in the environment. This report states many such factors that are to be
implemented in the business to remain in the competitive market.
From the above discussion, it can be concluded that Palfinger is an emerging company in
Malaysia and is very new to the oil and gas industries in Malaysia. Malaysia has contracted
Palfinger with a contract of providing 28 cranes. As in Southeast Asia, Malaysia is considered as
the second largest producer of oil and gas and the largest exporter of LNG (Liquefied Natural
Gas), there is a need of offshore equipment and winches. The offshore blocks of Malaysia has
two different distinct areas known as Peninsular Malaysia and the east Malaysia. From the above
study, it can be clearly stated that all the research questions considered for research study are
addressed in literature review. This report consists of a clear research aim and objective that are
addressed in this research paper. 16 papers were reviewed to carry out the study of oil and gas
industries in Malaysia and all the views of different researchers are presented in the literature
review. The research methodology that will be carried out in future studies are also clearly

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defined in this research paper along with a research plan that is planned for completing the entire
research paper.
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