Executive Summary
Schlumberger is reputed as the leading service company in the oil and natural gas industry. The company’s business magnitude is big, enabling it to spread its presence its presence across the globe. Schlumberger’s main strategy is building alliances and forming mergers.
This provides the company with ability to penetrate in the market easily. It builds its competitive advantage against industry rivals. Thirteen different companies carry out Schlumberger operations, each specializing in specific areas. Growing global demand for energy has enhanced the company’s potential of growth in future.
More industry players are willing to form alliances with Schlumberger to enhance their chances of business operations. Continuous legal suits and actions against the company affect Schlumberger’s profile. This may result in governments tightening regulatory frameworks, thus making it difficult for the firm to operate in their markets. More investments should be made in the area of research and development.
This will enable the company come up with practical solutions to the perennial environmental degradation problem that affects the company. The company over relies on the expenditure levels of the oil marketers. This puts its business at risk because the oil marketers equally depend on global oil prices before making expenditure decisions. Global oil prices are erratic and they put oil marketers’ investment and expenditure into jeopardy.
Schlumberger should sustain its alliance and merger strategy, but maintain close scrutiny prior to making decisions. Both companies engaging in the merger or alliance must realign their structures in order to eliminate chances of making costly mistakes. Failure to observe this measure may result in losses for both companies. Merger and alliance agreements must be fully understood and observed to limit the number of legal actions emerging as a result of breach of contract.
Introduction
Schlumberger is an international firm that offers different services to different players in the oil and gas sector. The services include digging wells, testing, seismic acquisitions, directional drilling, and seismic processing, among other activities.
The wide range of services are offered by many other smaller companies which fall under Schlumberger, and which could either have been acquired or working in strategic relation with the company. This report extensively covers the operations of the company, including analyzing its internal and external environments, its marketing and competitive strategies, as well as evaluate on the internship experience encountered at the firm.
Company Background
Activities
Schlumberger is a global firm that is technology-based. The company is involved in providing information solution to oil and gas firms. Schlumberger also engages in project management. With the company’s activities mainly targeting operations in the global oil sector and industry, Schlumberger has invested its expertise in well testing, seismic acquisition, seismic processing, artificial lift, formation evaluation, directional drilling, as well as managing software and information.
The company’s operations also include mining groundwater, as well as capturing carbon. It deals in various technologies and activities on how to store the captured carbon (Schlumberger, 2013).
The activities of the company are grouped together into two segments, with the Schlumberger Oilfield Services mainly focusing on the supply of the range of activities targeted at the oil production and operations. A second segment, Western Geco, concentrates its focus and activities on seismic operations. It additionally concentrates in data acquisition and processing services, which aim to improve the overall seismic operations.
Company Size
The total workforce size of the company is close to 120,000 people (Schlumberger, 2013). These workers are drawn from more than 140 nations across the globe. Schlumberger has established operation bases spanning across over 85 countries where it is mainly involved in oil exploration and production services.
Schlumberger is itself a conglomeration of up to 13 companies, all of which deal in different activities and services that enable the company to achieve the wide range operations and services. The member companies under the Schlumberger umbrella include WesternGeco, which is a leading geophysical services company, Smith Bits, which deals in designing, manufacturing, as well as marketing roller cone and the PDC drill bits that are used in the exploration of gas and oil (Schlumberger, 2013).
Dyna-Drill Technologies deals in the “designing and manufacturing down-hole motor equipment”. This is a very vital thing in the oil sector. MegaDiamond is involved in “ultra-hard materials used for cutting tools, drilling of oil and gas, mining applications and constructions” (Schlumberger, 2013, para 2). It mainly manufactures and designs all the equipments used for these activities.
Other Schlumberger member companies include Omni Seals, a custom molding company, Pathfinder, which offers directional drilling services, Thomas Tools, which specializes in downhole tool, and Coil Tubing Services, which literally deals in coil tubing services. E&P Wireline is involved in giving services like repairing pipes, “cased-holed logging” and tubing.
Wireline Control Systems concentrates on wireline pressure control, while DRILCO concerns itself with machining and inspection services. Geoservices focuses on mud logging, while M-I SWACO is a specialist company supplying drilling fluid systems (Schlumberger, 2013).
Vision and Mission
Schlumberger’s vision statement reads as follows: “Making the most of our unique assets, Schlumberger is committed to providing services that enhance and optimize our customers’ performance” (Schlumberger, 2013).
The company’s mission is three-thronged, and particularly the main focus in three areas that in include the people, technology, and profits. This mission statement reads as follows: “Our people thrive on the challenge to excel in any environment and their dedication to safety and customer service worldwide is our greatest strength.”
The mission concerning technology reads as follows: “Our commitment to technology and quality is the basis of our competitive advantage.” The third and final mission focused on profits reads: “Our determination to produce superior profits is the cornerstone for our future independence of action and growth” (Schlumberger, 2013).
SWOT Analysis
Strength
Schlumberger prides itself in being one of the largest and leading oilfield-related services in the world. Its large magnitude ensures it has the necessary capacity to attract and serve a large a market (Schlumberger Limited, 2012), which in turn enhances its revenue base. Its operations span across the entire globe, giving it the advantage to exploit all the available markets in the world.
Schlumberger has equally merged as well as acquired other industry players to improve on its brand value even further. The mergers and acquisitions provide it with the advantage of breaking market entry barriers and thus venturing into a wide cross-section of the market. Its excellent technology gives it the impetus to operate both efficiently and competitively within the industry (Schlumberger Limited, 2012).
Weaknesses
The company has been involved in a legal action, where it was sued by Norwood Resources (Schlumberger Limited, 2012). In the suit, Schlumberger was accused of breaching contract and warranty, as well as declaratory relief, and negligent misrepresentation.
In 2011, the company was involved in yet another legal tussle, where Midland County residents accused the company of polluting the environment as a result of its operations. These lawsuits could potentially affect the company’s profile and limit its chances of winning contracts and businesses (Schlumberger Limited, 2012).
Opportunities
The global exploration business is currently on the rise, with demand for energy being projected to increase by up to 40% by the time we reach 2035 (Schlumberger Limited, 2012). Hydrocarbon resources, mainly gas and oil resources are particularly to offer the bulk of the energy.
Strategic alliance remains one of Schlumberger’s main focuses in business in order to achieve expanded business and general operations. Such strategic alliances have seen the company acquire Eurasia Drilling Company’s assets and services, thus providing Schlumberger with an even expansive area for business exploitation purposes.
Threats
Various environmental and industrial risks occur as a result of Schlumberger’s operations and activities. Governments are seeking to tame this by introducing extensive regulations in order to protect their countries. Europe, for instance, has introduced the European Union Seveso II, which is a directive for classifying high risk sites (Schlumberger Limited, 2012).
Schlumberger’s survival in business is mainly pegged on the expenditure that the oil industry makes. This is a major threat to Schlumberger because the oil and gas companies equally depend on the global process of oil and gas, which are erratic to a greater extent.
Marketing Strategy
Alliance Marketing
Schlumberger operates mainly by merging with other companies in the industry for strategic reasons. The coming together allows the companies to pull their resources in order to enhance their market activity. This is creating a greater impact in the market because oil and gas operations require expensive tools, which very few companies can afford to acquire easily. Thus, the merging and pulling of resources together increases the capacity of Schlumberger’s operations in the market (Thoumrungroje, 2004).
Affinity Marketing
Schlumberger enters into partnerships with other firms in the industry in order to create a strategic partnership. In particular, Schlumberger seeks to partner with complimentary companies in order to add market value to the existing customers of both firms in the partnership, while also seeking to build more customer relationships (Emigh, 1999).
Competitive Strategy
Broad Differentiation
Schlumberger pursues a very broad differentiation strategy, which has seen it perform virtually all the services that the oil and gas industry requires in order to exploit and produce the products. To help it sustain the differentiation strategy effectively, Schlumberger allows the existence of strategic alliances with other companies, which are specialists in specific exploration and production areas.
Currently, there are up to 13 companies that operate under Schlumberger, which concentrate on a wide range of services that are required in exploiting and producing oil and natural gas resources (Smith, 2004).
Schlumberger also invests heavily in technology use, which has allowed it the ability to develop a wide range of software. The programs are specifically used in the oil and gas industry, enabling the company to achieve high efficient standards in its operations.
Market Focus
Schlumberger’s operations span across the entire globe, implying that the company focuses on the wider global market to increase its advantages and chances of increasing revenues.
The company has established specific regional structures, including regional offices, in such regions as Latin America, Africa, Europe, North America, Middle East, Russia, and Asia. With such arrangements, Schlumberger concentrates fully on the unique conditions in each of the markets. This enables the company to come up with perfect solutions that ensure enhance competitive performance.
Job History
Conceptual Framework
SharePoint has an intranet portal capability that allows an organization to centralize all relevant information that concerns its operations, for purposes of easy access by mainly the workers. The SharePoint application has the ability to also store as well as track all the electronic documents, including images if the company decides to incorporate them (Fontana, 2009).
The application has data-protection ability, where users can rely on their own secret passwords to log onto the website, thus blocking any unauthorized people from accessing the company’s information. This facility gives an opportunity to the company in order to integrate other third parties, such that a shared collaboration environment can be achieved. Such functionalities allow the firm to internetwork its own database with the suppliers and other business associates, in order to enhance efficiency in service delivery and general operations.
Customization
Companies can configure and customize details on SharePoint to better suit their expectations (Fontana, 2009). The application has an integrated user-interface, which can be compared to any of the latest Microsoft Office versions. Data manipulation is supported by this interface, where such activities and operations as page editing and addition of functionality to sites can be undertaken.
Thus, this structure of the application allows manipulation of contents making up the lists, pages, sites, as well as the libraries. It is possible to copy, delete, create new data contents, or even change the names of the previously existing libraries and lists, such that the new may reflect on the current situation of the firm.
User permissions are managed from a centralized location, mainly for purposes of protecting data and company information. The definitions as well as properties of lists are equally managed with ease as a result of the application’s flexibility feature. Other property details that can be managed with ease include web-parts, particular pages, as well as the libraries, among other numerous features (Fontana, 2009).
Technical Reflection
Information Loss
The recruiting department is experiencing loss of data and time as a result of a complicated database. The network management is equally weak, thus giving room for weak information management. The recruiting members and the personnel manager may fail to achieve proper communication and coordination as a result of this fault. The excel lists were filled in a wrong way, and required a lot of editing using the SAP form. The fields existing in the SAP form were not organized in an appropriate manner as is required.
Methodology
I made tables using the SQL server functionality to enable the linkup of interrelated functions. I linked up the database SQL with the SharePoint application as a way of eliminating the complications noted on the database. However, this new structure would not succeed in addressing the situation. Instead, it would end up complicating it more, and thus limit data acquisition process.
The alternative way of tackling the problem involved dropping the idea of using the database server altogether. The new option included storing all the data in the list contained in the navigation option on the SharePoint page. This solution allows the list to work as both storage location and database, thus making it easier to use the database, and save on the time that previously required more processes.
Changing of the fields on the SAP form involved adding additional fields such that information acquisition could be rendered more accurate. I introduced formulas using Boolean loops in order to simplify the whole process and procedure. I equally introduced programming codes as a way of making some cells to be filled mandatorily.
Evaluation of the Internship Experience
The internship experience revealed the fact that Schlumberger enjoys strong service-provision capabilities. The company’s customers particularly enjoy from this advantage in the sense that the company is capable of fulfilling all their demands and expectations, while also providing additional value to all the operations and services it provides.
Schlumberger’s recruitment has a significant capability of influencing the Saudization policy and also encourages the national power. The company boasts of one of the strongest team space techniques pertaining to network management.
Summary of Findings and Recommendations
Schlumberger’s operations have continuously been found to contravene laid down regulations, especially in terms of environmental management, and breach of contracts. This has seen the company being sued for damages in several occasions.
It is important for the management of Schlumberger to ensure these incidences are eliminated altogether because they negatively affect the company’s profile. One way through which this can be achieved is by investing in research and development such that more technical means can be arrived at, which will curb environmental degradation.
Schlumberger’s operations mainly rely on acquisition and merger strategy, to enable the company build more on its capability. This strategy is important for the company as it enables it to build on its competitive advantage, while also helping to lower on its operation costs.
However, approaching mergers and acquisition strategy should be done with caution. It is important for the company to ensure that it realigns its structures and operations prior to entering into any kind of merger or acquisition. This will ensure that customers and stakeholders of both companies have their interests protected fully. It will cushion both firms from experiencing any kind of uncertainties going forward.
Conclusion
Schlumberger is a major global company that focuses on oil and natural gas industry. The company offers a wide variety of services, which help in enhancing its competitive advantage over its market rivals. Schlumberger’s operation success also centre around the market focus strategy that the company employs, which has seen it establish strong structures and presence in key global regions.
This includes North America, Asia, Africa, Europe, and the Middle East. The rising global demand for energy particularly provides the company with growth opportunities that would see it increase revenue and expand operations.
However, the over reliance of Schlumberger on oil and gas marketers’ expenditure puts the company’s general operations into jeopardy. This is so owing to the fact that the global oil sector is prone to erratic price changes. Schlumberger uses SharePoint application to manage information mainly for use by its staff. This has made information extraction and storage highly efficient, while ensuring that the data is also protected from access by unauthorized persons.
References
Emigh, J. (1999). Affinity marketing. Computerworld, 33(39), 64-66
Fontana, J. (2009). SharePoint add-ons shine. Network World, 26(35), 10-14.
Schlumberger (2013). About Schlumberger. Retrieved from https://www.slb.com/who-we-are
Schlumberger Limited SWOT Analysis. (2012). Schlumberger, Ltd. SWOT Analysis, 1-8.
Smith, A. D. (2004). Knowledge management strategies: A multi-case study. Journal of Knowledge Management, 8(3), 6-16.
Thoumrungroje, A. (2004). The effects of globalization on marketing strategy and performance. Washington State University Dissertations and Theses, 159-159