scholarly journals Sustainability of TQM Implementation Model In The Indonesia’s Oil and Gas Industry: An Assessment of Structural Relations Model Fit

2011 ◽  
Vol 13 (1) ◽  
pp. 1 ◽  
Author(s):  
Wakhid Slamet Ciptono ◽  
Abdul Razak Ibrahim ◽  
Ainin Sulaiman ◽  
Sharifah Latifah Syed A. Kadir
Keyword(s):  
Financial Performance ◽  
Management Practices ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Model Fit ◽  
Implementation Model ◽  
World Class ◽  
Structural Relations ◽  
Operational Excellence ◽  
Oil And Gas Companies

This study purposively is to conduct an empirical analysis of the structural relations among  critical factors of quality management practices (QMPs), world-class company practice (WCC), operational excellence practice (OE), and company performance (company non-financial performance or CNFP and company financial performance or CFP) in the oil and gas companies operating in Indonesia. The current study additionally examines the relationships between QMPs and CFP through WCC, OE, and CNFP (as partial mediators) simultaneously. The study uses data from a survey of 140 strategic business units (SBUs) within 49 oil and gas contractor companies in Indonesia.  The findings suggest that all six QMPs have positive and significant indirect relationships on CFP through WCC and CNFP. Only four of six QMPs have positive and significant indirect relationships on CFP through OE and CNFP. Hence, WCC, OE, and CNFP play as partial mediators between  QMPs and CFP. CNFP has a significant influence on CFP. A major implication of this study is that oil and gas managers need to recognize the structural relations model fit by developing all of the research constructs simultaneously associated with a comprehensive TQM practice. Furthermore, the findings will assist oil and gas companies by improving CNFP, which is very critical to TQM, thereby contributing to a better achievement of CFP. The current study uses the Deming’s principles, Hayes and Wheelwright dimensions of world-class company practice, Chevron Texaco’s operational excellence practice, and the dimensions of company financial and non-financial performances.  The paper also provides an insight into the sustainability of TQM implementation model and their effect on company financial performance in oil and gas companies in Indonesia.       

scholarly journals Mediation Analysis Using the Hierarchical Multiple Regression Technique: A Study of the Mediating Roles of World-Class Performance in Operations

2010 ◽  
Vol 12 (2) ◽  
pp. 139 ◽  
Author(s):  
Wakhid S. Ciptono ◽  
Abdul Razak Ibrahim ◽  
Ainin Sulaiman
Keyword(s):  
Quality Management ◽  
Financial Performance ◽  
Management Practices ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Critical Factors ◽  
Gas Industry ◽  
Quality Management Practices ◽  
World Class ◽  
Operational Excellence

The changing environment in an organization is forcing the organization to find a plan of integrated management framework and adequate performance measurement. Failure to plan basically means planning failure for the business. Finding the critical factors of quality management practices (QMP), themediating roles of the contextual factors of world-class performance in operations (i.e., world-class company practices or WCC, operational excellence practices or OE, company nonfinancial performance or CNFP), and the company financial performance would enable the company to facilitate the sustainability of TQM implementation model.This empirical study aims to assess how TQM—a holistic management philosophy initially developed by W. Edward Deming, which integrates improvement strategy, management practices, and organizational performance—is specifically implemented in the oil and gas companies operating in Indonesia. Relevant literature on the TQM, the world-class performance in operations (world-class company and operational performance), the company performance (financial and non-financial performances), and the amendments of the Law of the Republic of Indonesia concerning the oil and gas industry, and related research on how the oil and gas industry in Indonesia develops sustainable competitive advantage and sustainable development programs are reviewed in details in our study. The findings from data analysis provide evidence that there is a strong positive relationship between the critical factors of quality management practices and the company financial performance mediated by the three mediating variables, i.e., world-class company practices, operational excellence practices, and company non-financial performance.

scholarly journals Sustaining the Oil and Gas Industry through corporate social responsibility practices by multinational oil and gas companies in emerging economies.

2021 ◽  
Author(s):  
Ama Twumwaa Gyane ◽  
Edward Kweku Nunoo ◽  
Shafic Suleman
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Performance ◽  
Emerging Economies ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Data Set ◽  
Key Aspects ◽  
Corporate Social ◽  
Oil And Gas Companies

Abstract The objective of this study was to provide empirical evidence from the perspective of corporate social responsibility practices by multinational oil and gas companies in emerging economies on how investments in and disclosure of this practice could enhance financial sustainability. Accounting-based measures on investments, financial performance, disclosures of activities and panel data set on company size (total assets) over a 10-year period (t) were analysed. Findings show that oil firms with interest in emerging economies take key aspects of corporate social responsibility practices seriously. There was significant positive relationship (p = 0.0035 < 0.05) between investment in the practice and sustainability in financial performance. No significant relationship (p = 0.4409 > 0.05) was established between disclosure and financial performance. Functional corporate social responsibility practices were envisaged to yield sustained dividend in terms of a stronger financial outlook for oil and gas companies for poverty alleviation and to achieve key sustainable development goals and targets in emerging economies.

scholarly journals Exploring the Linkages Between Deming’s Principle, World-Class Company, Operational Excellence, and Company Performance in an Oil and Gas Industry Setting

2005 ◽  
Vol 7 (2) ◽  
pp. 205 ◽  
Author(s):  
Wakhid Slamet Ciptono
Keyword(s):  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Equation Modeling ◽  
Company Performance ◽  
Effective Response ◽  
Gas Industry ◽  
Positive Effects ◽  
World Class ◽  
Operational Excellence ◽  
Monetary Gain

This study explores the linkages between Deming’s Principle, World-Class Company, Operational Excellence, and Company Performance in the Indonesia’s oil and gas industry. The aim of this study is to examine the causal relationships model between the Deming’s Principle (DP), World-Class Company (WCC), Operational Excellence (OE), and Company Performance (Monetary Gain Performance or MGP and Value Gain Performance or VGP). The author used 140 strategic business units (SBUs) in 49 oil and gas companies in Indonesia. The survey was administered to every level of management at each SBU (Top, Middle, and Low Level Management). A multiple informant sampling unit is used to ensure a balanced view of the relationships between the research constructs, and to collect data from the most informed respondents on different levels of management. A total of 1,332 individual usable questionnaires were returned thus qualified for analysis, representing an effective response rate of 50.19 percent. Path analysis and structural equation modeling (SEM) are used to analyze the effect of Deming’s principle on company performance and to investigate the interrelationships between Deming’s principle, world-class company, operational excellence, and company performance. The results show that Deming’s Principle has significant positive and indirect effect on company performance (monetary gain performance and value gain performance). Although the Deming’s Principle has no significant direct effects on company performance, the Deming’s Principle has significant positive effects on the intervening variables (world-class company and operational excellence). The result also shows that a complete model fit and the acceptable parameter level that indicate the overall parameter are good fit between the hypothesized model and the observed data. By concentrating on a single industry (oil and gas), SEM specification of the causal relationship model between five constructs can be more complete and specific because unique characteristics of the oil and gas industry can be included (upstream and downstream chain activities). Finally, the particular design of the research and the findings suggest that the structural model of the study has a great potential for replication to manufacturing as well as service operations.

scholarly journals Hierarchical level oF managers’ abilities: A Moderator between Quality Management Practices and Company Financial Performance

2007 ◽  
Vol 9 (3) ◽  
pp. 295 ◽  
Author(s):  
Wakhid Slamet Ciptono
Keyword(s):  
Quality Management ◽  
Financial Performance ◽  
Management Practices ◽  
Hierarchical Level ◽  
Critical Factors ◽  
Organizational System ◽  
Quality Management Practices ◽  
Structural Relationships ◽  
World Class ◽  
Operational Excellence

This study investigates the moderating impacts of hierarchical level of managers’ abilities on the form and strength of all structural relationships between quality management practices and company financial performance. This study describes the structural relationships among the research constructs —six critical factors of quality management practices (quality improvement program, supervisory leadership, supplier involvement, management commitment, training to improve products/services, cross-functional relationships); the contextual factors of oil and gas companies—world-class performance in operations (world-class company practices, operational excellence practices, company non-financial performance); and company financial performance. It uses a sample of 1,332 managers in 140 strategic business units (SBUs) within 49 oil and gas companies operating in Indonesia. The empirical results indicate that the goodness-of-fit of the unconstrained model is much better than that of the constrained model, and this is an indicator that hierarchical level of managers’ abilities moderates all structural relationships among the research constructs. Hence, the hierarchical level of managers’ abilities acts as a moderating variable of the whole model (i.e., among critical factors of quality management practices, world-class company practices, operational excellence practices, company non-financial performance, and company financial performance). It means that the major contribution of the hierarchical level of managers’ abilities is how to make changes in the organizational system. Top level managers’ abilities are deemed the most capable of making significant changes because of their broad sources of power and influence. Conversely, lower level managers’ abilities find it more difficult making significant changes in the system because of bureaucratic control processes that limit their actions —powerlessness or a chronic lack of autonomy. Compared to the hierarchical level of managers’ abilities, the degree of autonomy may be a more comprehensive contribution in reference to managers’ abilities to influence an organizational system. Autonomy may not only act as a person enhancer to increase internal work motivation, but it may also serve to moderate the extent to which individuals are able to significantly influence a system. In addition, involvement and empowerment of all organizational members (including managers) in cooperative and collaborative (interactive) efforts to achieve quality improvements appear to be a key element to TQM. Results further reveal that world-class performance in operations (world-class company practices, operational excellence practices, and company non-financial performance) positively mediates the impact of critical factors of quality management practices on company financial performance. Results also point out that three out of six critical factors of quality management practices are positively associated with world-class company practices and operational excellence practices under the moderating of hierarchical level of managers’ abilities. World-class company practices and operational excellence practices have direct and significant effects on company non-financial performance. Furthermore, empirical results suggest that there is a positive and significant relationship between company non-financial performance and company financial performance.

Analyzing the market valuations of the world's leading public oil and gas corporations

2020 ◽  
Vol 26 (12) ◽  
pp. 2765-2789
Author(s):  
O.V. Shimko
Keyword(s):  
Oil And Gas ◽  
Balance Sheet ◽  
Oil And Gas Industry ◽  
Market Valuation ◽  
Net Income ◽  
Consolidated Financial Statements ◽  
Market Capitalization ◽  
Economic Analyses ◽  
Market Valuations ◽  
Oil And Gas Companies

Subject. This article explores the market valuation ratios of the twenty five leading public oil and gas companies between 2006 and 2018. Objectives. The article aims to identify key trends in the changes in market valuations of the largest public oil and gas companies, and identify the factors that have caused these changes. Methods. For the study, I used comparative, and financial and economic analyses, and generalization of materials of the companies' consolidated financial statements. Results. The article shows certain changes in the main indicators of market valuation of the leading public oil and gas companies and identifies the main factors that contributed to these changes. It establishes that the most significant for comparison and valuation are ratios based on balance sheet values of assets and equity, and EBITDA, DACF and net income ratios are appropriate as auxiliary ratios. The article says that the exchange segment of the industry has increased the debt load, so instead of market capitalization as a component of the coefficients of this group, it is advisable to apply the company's value indicator. Conclusions and Relevance. The article concludes that the market sentiments towards the stock market segment of the global oil and gas industry are getting impaired. This is quite natural against the background of falling profitability of most leading companies. The results of the study can be useful in evaluating, forecasting and developing measures to increase the market capitalization and value of public oil and gas companies.

EBITDA and DACF multipliers as an indicator of investment attractiveness of domestic vertically integrated companies

2021 ◽  
Vol 20 (4) ◽  
pp. 718-752
Author(s):  
Oleg V. SHIMKO
Keyword(s):  
Oil And Gas ◽  
Stock Exchange ◽  
Oil And Gas Industry ◽  
Financial Economic ◽  
Consolidated Financial Statements ◽  
Gas Industry ◽  
Debt Burden ◽  
Fixed Assets ◽  
Settlement Agreements ◽  
Oil And Gas Companies

Subject. The article addresses the EV/EBITDA and EV/DACF ratios of the twenty five largest public oil and gas corporations from 2008 to 2018. Objectives. The purpose is to identify key trends in the value of EV/EBITDA and EV/DACF ratios of biggest public oil and gas corporations, determine factors resulted in the changes over the studied period, and establish the applicability of these multipliers for assessing the business value within the industry. Methods. I apply methods of comparative and financial-economic analysis, and generalization of consolidated financial statements data. Results. The study revealed that EV/EBITDA and EV/DACF multiples are acceptable for valuing oil and gas companies. The EV level depends on profitability, proved reserves, and a country factor. It is required to adjust EBITDA for information on impairment, revaluation and write-off for assets that are reported separately from depreciation, depletion and amortization costs, as well as for income or expenses arising after the sale of fixed assets and as a result of effective court decisions or settlement agreements. It is advisable to adjust DACF for income, expenses and changes in assets and liabilities, which are caused by events that are unusual for oil and gas companies. Conclusions. The application of EV/EBITDA and EV/DACF multiples requires a detailed analysis and, if necessary, adjustments of their constituent components. However, they are quite relevant in the context of declining profitability and growing debt burden in the stock exchange sector of the global oil and gas industry.

scholarly journals Empirical analysis of inbound open innovation and SMEs performance: Evidence from oil and gas industry

2018 ◽  
Vol 21 (1) ◽  
Author(s):  
Yusuf O. Akinwale
Keyword(s):  
Financial Performance ◽  
Open Innovation ◽  
Measurement Errors ◽  
Structural Equation ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Gas Industry ◽  
Petroleum Sector ◽  
External Actors ◽  
The Relationship

Background: This article contributes to existing literature by examining the relationship between inbound open innovation and firms’ financial performance in the Nigerian oil and gas industry. Aim: This article seeks to identify the factors of inbound open innovation and whether these factors influence the financial performance of small and medium-sized enterprises (SMEs) in the Nigerian oil and gas industry. Setting: This article examines 150 indigenous oil and gas SMEs in the upstream subsector of the Nigerian petroleum sector through a survey, using a questionnaire, conducted in 2015. Methods: The study applied the structural equation modelling (SEM) method. This method is used to test the relationships between the factors and to calculate the measurement errors in the hypotheses formulated. Results: The results show that technology scouting, vertical technology collaboration (VTC) and horizontal technology collaboration (HTC) positively and significantly contribute to inbound open innovation, which are thus significant in influencing the financial performance of SMEs. The size of technical staff and research and development (R&D) fund allocations also have a positive and significant correlation with the SMEs’ financial performance. Meanwhile, the age of SMEs is negative and not significant in influencing financial performance. Conclusion: The results suggest that inbound open innovation through scouting, HTC and VTC should therefore be encouraged among SMEs to boost their internal capabilities, which have hitherto enhanced their financial performance. The management members of each SME should continually consider collaboration with the external actors because they cannot singularly possess all the innovative skills required in the industry. Also, each firm should commit itself to allocate more funds to R&D and at the same time should hire those who have relevant production skills and train the existing ones in their firms.

scholarly journals DETERMINATION OF THE SUSTAINABILITY OF THE PROJECT PORTFOLIO OF THE OIL AND GAS SECTOR OF THE ECONOMY TO EXTERNAL FACTORS

2021 ◽  
pp. 32-40
Author(s):  
L.S. Leontieva ◽  
◽  
E.B. Makarova ◽  
Keyword(s):  
Oil Recovery ◽  
Portfolio Management ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
External Factors ◽  
Project Portfolio ◽  
Project Portfolio Management ◽  
Oil And Gas Companies ◽  
Oil And Gas Sector

The oil and gas sector of the economy in many states remains the main source of foreign exchange and tax revenues to the budget. Moreover, its share, for example, in Russia, accounts for about 12 % of all industrial production. However, this sector, as the practice of world oil prices shows, is experiencing not only a rise, but also a decline. Consequently, the problem of forming a balanced portfolio of oil and gas assets is an object of close attention on the part of national oil and gas companies. The issues of choosing the optimal combination of oil and gas assets in the portfolio are no less urgent, especially among the tasks that all oil and gas companies face, both in Russia and abroad. An investment portfolio or a portfolio of oil and gas assets, which includes new projects for the commissioning of fields, as well as measures to enhance oil recovery, and exploration are objects of real investment. The high volatility of the oil and gas industry is influenced by various factors, including: macroeconomic, innovation risks and a number of others. These circumstances stimulate the sector to increase the resilience of its project portfolios in order to respond flexibly to changes. In an increasingly challenging and uncertain environment, oil and gas companies around the world face constant pressures as difficult strategic decisions and building long-term plans lead to a sustainable portfolio. In order to achieve their goals and maximize profitability, companies should apply certain algorithms in their practice. The article substantiates the role and importance of project portfolio management in achieving the goals of the state and companies in the oil and gas sector. The main goal of the article is to build an algorithm that is aimed both at determining the stability of the portfolio and the ability to flexibly respond to changes in the environment. The scientific novelty of the research lies in the determination of an algorithm for assessing the sustainability of a portfolio of projects of oil and gas companies. Application of this algorithm will allow oil and gas companies to take into account the influence of external factors. The research methodology is based on such methods as analysis of internal regulations and reporting of companies for project portfolio management, risk analysis, project ranking; grouping and classification method.

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