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The Oil Industry in an Unstable Economic and Political Environment

In: Business and Management

Submitted By akinjide
Words 5530
Pages 23
STRATEGIC MANAGEMENT IN THE NIGERIAN OIL INDUSTRY WITHIN AN UNSTABLE ECONOMIC AND POLITICAL ENVIRONMENT

AKINJIDE ODUNLAMI

DECEMBER 31ST 2010

Table of Contents

Introduction 3
The Oil Industry in Nigeria 3
Oil industry and the Nigerian Economy 5
Social and Environmental Impact 6
Strategy in the Nigerian Oil Industry 8
Managing External and Internal Forces 8
Assumptions 9
Key Strategic Activities 10
1. Timely Funding of the Joint Venture Cash Calls 10
2. Operational Efficiency 11
3. Cost Reduction and Leadership 11
4. Capacity Building 13
5. Facility Integrity and Innovation 14
6. Sustainable Development 14
7. Gas Utilisation 16
8. Security 16
Strategic Fit and Sustainability 17
Strategic planning and management system 17
Balanced Score Card 17
References 18

Introduction

This paper considers Strategic management in the oil industry to deliver value and economic development in an economy very much dependent on crude oil revenue and with a fluctuating local currency rate against the US Dollar coupled with a volatile political climate with attendant security concerns. The industry, economy and political environment in focus here are those of Nigeria, a developing West African country.

Within the context and space constraints of the Nigerian economic, political and social climate, an oil company must carefully define and manage its Corporate Strategy such that the overall purpose and scope of the business will meet stakeholder expectations and align with government policies and aspirations. Such strategic management will help determine the long term direction and the scope of operations, products and services which will enable the organization to sustainably achieve its set objectives in the face of market competition and economic realities...

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