Linking Strategy to Performance in the Oil Industry

A.J.P. Fletcher, JP Davis

Research output: Chapter in Book/Report/Conference proceedingConference Contribution (Conference Proceeding)

2 Citations (Scopus)

Abstract

For an organisation, once having decided upon a given strategy, it is natural to want to assess subsequent performance against those strategic goals. However, it is notoriously difficult to quantify linkage between a strategy and seeing how it works. We propose a methodology to measure performance and establish the linkage between an agreed strategy to subsequent actions. We argue that the key elements required to achieve the goal of a joined up system of strategy, overview and operation must include a shared ‘picture of the organisation’, an identification of real processes of that organisation and a direct linkage between the processes and the measurement of the success of those processes. This could be expressed as: Purpose, Process and Performance We argue that a ‘shared picture of the organisation’ assists in communicating a consistent and unified picture to all those involved in transforming strategy into action The authors present, through a consideration of organisational complexity and systems thinking, a process based method of representing an organisation to help identify the critical processes which will deliver strategic success and target performance measurement to monitor these critical processes. Two studies are presented. Firstly, the selection and application of chemical EOR technology in the field is discussed with reference to projects conducted over the last two decades. Secondly, a study of options for gas developments with regards the NW Shelf of Australia is presented. The methodology allows the creation of a hierarchical process model grounded in the values of the organisation; providing the capability of modeling at both strategic and operational levels. If communicated throughout the organisation, the model provides a consistent picture to all involved, reducing the irregularities that result from differing mental models and thereby increasing the potential for organisational learning.
Translated title of the contributionLinking Strategy to Performance in the Oil Industry
Original languageEnglish
Title of host publicationSPE ASIA PACIFIC OIL & GAS CONFERENCE AND EXHIBITION (APOGCE) Perth
Number of pages16
Publication statusPublished - 2008

Bibliographical note

Other page information: SPE Paper 114398

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