Study on Strategic Development of Petroleum Enterprises Based on AHP-SWOT Analysis〔*〕

Chen Junhua,Hu Siyun

(School of Economics and Management　Southwest Petroleum University,Chengdu　Sichuan　610000)



Study on Strategic Development of Petroleum Enterprises Based on AHP-SWOT Analysis〔*〕

Chen Junhua,Hu Siyun

(School of Economics and ManagementSouthwest Petroleum University,ChengduSichuan610000)

Ⅰ.AHP-SWOT analysis framework of petroleum enterprise

An AHP-SWOT analysis framework for the sustainable development of Chinese petroleum enterprises is built by combining the current development environment for petroleum enterprises and the principles of the AHP-SWOT analytical method.The main steps are as follows:

1.Identify and analyze the factors that affect the sustainable development of Chinese petroleum enterprises.Find out the major factors that affect the sustainable development of petroleum enterprises based on the analyzed and processed unique data from research on petroleum enterprises,which constitute the factors of SWOT analyses of petroleum enterprises.

2.Cross analysis shall be applied for each factor.Due to the fact that many connections are there between the factors that affect the sustainable development of petroleum enterprises,that is,there might be certain crosses between factors during SWOT analysis.It is necessary to apply cross analysis on the factors after the independent analysis on each factor that affects the sustainable development of petroleum enterprises.

3.AHP-SWOT quantitative analysis:After a qualitative analysis,apply AHP to analyze quantitatively the degree of effect each factor has on the sustainable development of petroleum enterprises,which will make the SWOT analysis less subjective.

4.Determine development strategies based on the results of qualitative and quantitative analyses and by creating a strategy quadrangle and the quadrant at its center provides reference for the final supporting policy measures.

Ⅱ.The Application of Preferred Models for Sustainable Development of Petroleum Enterprises

1.Cross analysis of the factors in SWOT analysis

(1) Analysis of SW factors

SW mainly belongs to internal factors.In a qualitative aspect,the internal strengths of the petroleum enterprises are mainly breakthroughs in energy technology,low costs in production factors,diverse channels of finance and a well-developed retail terminal sales network while the internal weaknesses mainly are shortages of high-end,well-rounded talent,a lack of core technology,underdevelopment of enterprise-university-research cooperation mechanisms and transformation of customer demand towards clean energy.Chinese petroleum enterprises should take advantage of these strengths while averting the weaknesses to achieve sustainable development.

(2) Analysis of OT factors

OT mainly belongs to external factors.The external opportunities for the sustainable development of petroleum enterprises are mainly financial and policy support by the state,new room for enterprise development brought by energy restructuring,a bright future for the petroleum and petrochemical industry promised by the development of the new energy industry and changes in the ways and directions of petroleum enterprise development caused by development of new energy.Though in a favorable period filled with opportunities,petroleum enterprises should,while seizing these opportunities,be poised to confront threats including the threats of traditional ideas,energy supply,technological innovation and energy markets.

(3) Comprehensive qualitative SWOT analysis

The four aspects of SWOT permeate and interact with each other without any clearly defined boundaries.A comprehensive analysis concludes that petroleum enterprises face many opportunities and have strong internal strengths,but their development is restricted due to technological limits and competition.

2.Result analysis

It can be concluded that,the four factors that affect the sustainable development of petroleum enterprises by degree of impact shall be:opportunity>strength>threat>weakness.Therefore,it is evident that petroleum enterprises are mostly affected by opportunity,mainly by the new room for enterprise development caused by energy restructuring represented by O2.Meanwhile,petroleum enterprises also face great threats,especially the threats of traditional ideas and technological innovation.

3.Conclusion of empirical analysis of petroleum enterprise

According to the above analysis results,the value of group priority numbers represents the degree of impact each factor has on sustainable development in SWOT analysis of petroleum enterprises.Strategy quadrangles of the sustainable development policy of petroleum enterprises can be created according to these values.As shown in the following graph(Omitted),the positive direction in the x-axis represents the strength factor,the negative direction represents the weakness factor;the positive direction in the y-axis represents the opportunity factor and the negative direction represents the threat factor.

Ⅲ.Policy Support for the Sustainable Development of Petroleum Enterprise

1.S-O Strategy,using advantages and seizing opportunities

(1) Changing the development mode and direction of the petroleum enterprises

China’s petroleum enterprises should make the most of overseas advanced technologies,processes and equipment.They should also be market-oriented to cultivate core technology and create well-known brand name products as well as implement brand development strategies;through active cooperation with excellent overseas enterprises,they should continuously optimize the product structure and provide additional value;what’s more,they also should take the convenience and safety of resources supply into consideration to reduce transportation costs and improve industrial concentration.

(2) Developing alternative energy sources,relevant industries and energy-saving industries

Petroleum enterprises in the future will be transformed into energy enterprises,thus,in order to achieve the transformation and their sustainable development,they should raise a proportion of alternative energy sources in their energy structures.The adjustment in the energy structures brings a new space for enterprises’ development,so when alternative energy sources are developed positively,relevant industries and energy-saving industries shall also be given emphasis to develop.

(3) Promoting energy conservation and emissions reduction and actively developing a circular economy

The basic idea of China’s energy sources development strategy in the coming ten years is energy conservation and efficiency first,then coordinating environmental development and internal & external development simultaneously.China has given financial and political support,which provides an advantage for the development of the circular economy of petroleum enterprises.The sustainable development mode of petroleum enterprises is to maintain the internal vitality and external coordination to create an industrial development model intrinsically integrating ecologicalization and economization.During the development of petroleum enterprises,energy conservation and emission reduction should be given important positions.Energy conservation management and pollution treatment should be strengthened to positively develop the circular economy.

2.W-O Strategy,using opportunities and eliminating disadvantages

(1) Increasing funding and establishing standards with an efficient human resource management system

Increase funding and establish standards with an efficient human resource management system;improve the salary,welfare and security systems of these enterprises.Increase enterprises’ attractiveness to high-level talent.Reforms in salary and welfare systems shall be promoted stably and positively to establish a salary system suitable to any and all kinds of personnel and efficiently highlight positive values and performances as well as fully reflect the value of all talent,especially personnel in management and operations as well as professional and operational skills.Human resource management shall ensure to be transparent,scientific,standard and efficient to achieve the optimal allocation of human resources.

(2) Strengthening the connection of enterprises with universities and research and development institutions and establishing perfect producing-studying-researching mechanisms

The government should give political support and properly adjust and control the interested distribution to guarantee a balance of interests in all respects.The application of scientific achievements shall be encouraged and the connection of theory and practice shall be strengthened.Enterprises should provide training platforms to greatly promote the application of scientific achievements.

(3) Improving the service of traditional energy and greatly developing new energy industries

In the face of current social and environmental situations,new energy industries will be developing well,and clean energy will gradually be in favor to customers.Petroleum enterprises should pay close attention to and increase investments in new energy industries,establish their own new energy industries and establish research to perfect new energy & development,production,transportation and marketing systems.In addition,as for traditional petroleum energy,petroleum enterprises should be more committed to improving product quality and professional quality of workers to provide better service to customers and to maintain the traditional energy’s status to customers.

3.S-T Strategy,using opportunities and meeting challenges

(1) Enterprises innovating thoughts and making new development ways

The petroleum enterprises should look at the current situation,encourage innovative entrepreneurial ideas,keep pace with the times and establish new enterprise developmental ideas and special cultures.Additionally,petroleum enterprises should also cultivate advanced management personnel and technical personnel with new thoughts and new outlooks,who can contribute to the development of enterprises.

(2) Increasing the scientific research investment and speeding up technological innovation

In order to master core technologies,petroleum enterprises should increase investments in scientific research,development and innovation and also cultivate and introduce more high-quality talent,thus realizing core competitiveness that leads to proprietary technologies and greatly promote the establishment and perfection of the producing-studying-researching mechanisms of petroleum enterprises and the transformation of petroleum enterprise development modes and direction as well as ensure sufficient scientific research funds that solve problems and innovate in all aspects of technology and finally absorb innovative and technical talents.

(3) Reforming energy structures and changing marketing strategies

In the face of a complicated energy market,petroleum enterprises should greatly improve their product quality and personnel to better provide services to customers and ensure the quantity demanded and sales volume of their products.Additionally,marketing strategies should be innovative with more marketing channels.The marketing of new energy products should be strengthened by taking advantage of their own perfect terminal retail trade system.

4.W-T Strategy,minimizing disadvantages and challenges

(1) Strengthening the exploration and development of oil and gas resources and establishing a petroleum reserve system

Under the challenge of energy supply,petroleum enterprises should keep a foothold in China’s oil and gas resources and strengthen exploration and development.Meanwhile,they should speed up international exploration and development,establish diversified transportation corridors and look at international development space.Searching for oil and gas resources across the globe is one of the basic strategies of multi-national petroleum firms.China’s petroleum enterprises should continue to expand their business into North Africa,South America,Central Asia and the Asia-Pacific Region and establish several overseas oil and gas production bases with considerable scale.They should possess oil and gas resources through overseas businesses and become competitive in the international markets.

(2) China’s petroleum enterprises establishing petroleum reserve system

While keeping a sustainable supply of China’s oil and gas resources,they also should pay attention to establishing a petroleum reserve system.At present,China’s petroleum reserve is mainly a state reserve.Considering their own interests,petroleum enterprises should speed up the establishment of their own internal petroleum reserve system,which can improve China’s strategic reserve and also efficiently avoid the energy market risks resulting from fluctuations in prices.

(3) Establishing purchase protection from petroleum risks

The unstable international petroleum price is a great challenge to China’s petroleum enterprises for sustainable development,thus it is necessary to start marketization on petroleum to avoid petroleum price risks,to reduce the uncertainty due to price changes and to guarantee enterprises’ economical interests.The marketization operation of petroleum is actually to combine the crude oil spot & futures markets with capital markets to establish purchasing protection from risks and buffer risks resulting from price changes.

Notes:

〔1〕Jin Lili,Huang Qi,Tian Bingquan,The Application of SWOT Analysis on Project Risk Management,Science & Technology and Economy,2007,20(1),pp.55-58.

〔2〕Han Xiaojing,The Application of Analytic Hierarchy Process on SWOT Analysis,Information Research,2006(5),pp.119-122.

〔3〕Shen Yu,The Application of SWOT Analysis in Regional Sustainable Development Orientation,Xiamen:Xiamen University,2009.

〔4〕Wu Xiaowei,A SWOT Analysis for the Sustainable Development of Tourism Industry based on AHP Method,Journal of Leshan Teachers College,2007,22 (5),pp.36-41.

〔5〕Feng Xuejun,Yue Qiaohong,Port Development Strategy along Jiangsu Province Coast based on SWOT Analysis,Shipping Management,2007,29 (1),pp.25-30.

〔6〕Zhang Gengli,Study on Sustainable Development of State-owned Petroleum Enterprises,Daqing Petroleum Institute,2007.

〔7〕Zhang Shuwen,Low Carbon Economy:the Opportunities and Challenges for China,Journal of Beijing Institute of Oil Management,2010(08),pp.4-9.

This thesis creates an analytical model of petroleum enterprises by applying AHP (analytic hierarchy process) and SWOT analytical methods.It holds that the strategy for sustainable development of petroleum enterprises shall be growth-oriented.Finally,policy measures for supporting sustainable development of petroleum enterprises are proposed.

AHP;SWOT analytical method;sustainable development;petroleum enterprise

About the author：Chen Junhua (1975—),associate professor,postgraduate supervisor,researcher of Research and Development Center of Petroleum and Natural Gas in Sichuan Province ，research fields:management and assessment;Hu Siyun (1991—),postgraduate,research field:managerial science and engineering.

〔*〕Sichuan Social Science Advanced Research Team Development Plan Fund Program;SWPU Humanity Special Fund Program (2012RW019).