Business
Research Paper: Literature review
Devising business models that meet the customers’ demands, satisfy regulatory agencies and carrying out business with sustainable methods to alleviate climate change and other environmental problems as much as possible (Boons et al., 2013; Lee & Casalegno, 2010). The types of methodologies addressed here have been implemented at ENOC or in the UK energy sector. At the heart of the management methods is customer satisfaction. Emiratisation, customer satisfaction and operational theory are seen as the potential answer to meeting new management milestones for Emirates National Oil Company (ENOC). Emiratisation is a UAE government initiative to reach full employment for UAE citizens; and the employment must be skilled or professional. The application of the policy has been proceeding with far more success in the public sector compared to the private sector.
Dr. Marcus Wiesner the CEO of Aon Hewitt Middle East warned that many Emiratis companies view the Emiratisation as a race to hire all the best local talent possible but the companies neglect to develop a strategic plan or a management system to gain success in the long term (Wiesner, 2015).
The ENOC announced through a press release that the management strategy was having a positive effect on their business. The company is dedicated to increase customer satisfaction by monitoring the company with performance assessments. The Balanced Scorecard (BSC) is the methodology applied because the method is highly respected and applied in many different sectors around the world. The BSC is a straight forward method of measuring performance in terms of customer satisfaction and operational efficiency. The leadership and top management of ENOC support the use of BSC and expect to use the method as a driver to enhance the strategy of diversification that that is imperative for business success (“ENOC achieves,” 2013).
A change in ENOC business management strategy is no surprise because of the dip in profits that the company experienced with the global financial crisis coupled with the dip in prices for fuel. The company is privately owned and UAE counts on ENOC to be a leader in initiating sustainable and diversified strategies for promoting UAE workers. The company sells fuel and related products domestically and exports to Saudi Arabia within a partnership structure with Saudi Arabia’s Aldrees, a company that operates at least 450 service stations. ENOC has shown a willingness to take risks and to reach across the borders of the UAE to promote the company.
Several studies provide information about strategies used in the energy sectors to meet customer satisfaction by applying management techniques that bring supply chain vendors in line with the companies using their services and buying their products. A case study was undertaken by Galadari, Verma, and Lemaitre (2013) to observe and evaluate the strategic transformation at ENOC. A challenge that cannot be ignored is the resistance to change of employees and vendors, especially after many years of establishing a comfort zone. The robust revenues in 2012 reached approximately $15.6 million from the downstream services and items the gas company offers. Firstly the strategy was planned by reviewing the status quo and “to assess the external environment . . . the strategic challenges (near-and-long-term) and hammer out a strategy.” (Galadari et al., 2013, p. 3) The BSC management tool was the choice of CEO Saheed Khoory, he was familiar with using BSC and other energy companies in the region had already adopted BSC (Galadari et al., 2013). ENOC’s leadership and top management personnel were trained to use BSC, produce strategy maps, and learn how the method can be focused on a particular issue and developed to meet challenges Galadari et al., 2013). The BSC aids managers in developing appropriate objectives, metric systems and key performance indicators (KPIs) (Galadari et al., 2013). The framework built for ENOC rested on the four cornerstones listed below.
Robust and sound method
Active involvement from top leadership to drive change
Assist employees to further develop their personal competencies
Provide robust governance at ENOC
Hannon, Foxon and Gale (2015) researched the “demand pull” of government policies used to maintain and support Product-Service Systems in the energy sector. Their study specifically focused upon UK Energy Service Companies (ESCos) (Hannon et al., 2015). Product Service Systems (PSSs) are attractive for different sectors because they address move to sustainable enterprises paired with healthy economies (Hannon et al., 2015). Hannon et al. (2015) recommends the application of the ‘demand pull’ method in order to overcome some of the barriers that challenge its use. Part of the case study focused on the “regulatory, economic incentive, informative and procurement policies” that have the potential to support the energy company (Hannon et al., 2015, p. 900). The researchers made recommendations on how to develop policy on the issue of PPS.
A balance must be reached between policies that offer financial incentives and the regulatory constraints that from the disincentives,
The support of the government policies can be felt even if the support is indirect,
Market structures need to be developed to support PPS,
PSS activity can be enhanced by local actions, and
Make the focus to develop stable frameworks (Hannon et al., 2015).
Barriers still exist that government policy cannot address even if all the above recommendations are implemented; one of the most challenging is customer satisfaction (Hannon et al., 2015).
Research by Ghazal et al. (2016) addressed the issue of customer satisfaction in the UAE paired with perceived usefulness of a proposed device to aid consumers in saving energy targeted. (The devise is described as a smart plug system with Wifi sensors interfaced with a Smartphone to monitor electricity use.) The researchers developed a questionnaire in Arabic and in English. A video describing the item and its benefits was shown to the respondents before they filled out the questionnaires. The pool for to find the respondents consisted of developing a database of 970,000 of potential respondents and sending e-mails explaining the study. The researchers applied a computer simulation model in order to validate their results that were gained through two experiments, one with and one without the hands-on experiencee with the items. The researchers conclude that “environmental concerns impact positively the perceived usefulness and satisfaction with the proposed system.”
Gas sector reforms and how domestic customers are influences was the topic of research by Poupeau (2009). The research was perceptive was organizational sociology. The researcher focused on the impact of distribution networks on customer satisfaction with the French gas network as the factor. Interestingly, one of the outcomes was the attitude of gas network operators who catagorized customers based the difficulty level of a customer’s request. In other words, one category was a direct request (from a good customer) and the operator used a conventional process already used many times before (Poupeau, 2009). When the customer’s request was difficult to resolve (a bad customer), the operator had problems finding a solution (Poupeau, 2009). One of the conclusions was that the study demonstrated the many tools that operators have to use in order to deal with “mass market” requirements instead of concentrating on “individual made-to-measure solutions’ (Poupeau, 2009). The gas network distribution network was found to be an important factor in producing customer satisfaction.
Customer values were assessed in an exploratory study concerning business-2-business markets (B2B) (Keranen & Jalkala, 2013). ENOC is a B2B market because, for example fuel, service and related items are sold at service stations. The methodology consisted of in-depth interviews with 18 managers (Keranen & Jalkala, 2013). The resulting evaluation of the interviews identified five essential process and 11 related activities for B2B markets customer value assessments (Keranen & Jalkala, 2013,. The five processes identified were “value potential identification, baseline assessment, performance evaluation, long-term value realization, and systematic data management” (Keranen & Jalkala, 2013, p. 1307).
Summary
This literature review addressed issues pertinent to ENOC and to the UAE. The published research shows that management for customer satisfaction is a priority to businesses in the UAE. Business models in the UAE public sector appear to be implementing management policies that are in step with the Emiratisation policy and that prioritize customer satisfaction. Customer satisfaction is a challenge but thoughtful processes managed well can lead to success. ENOC uses the Balanced Scorecard method because it has proven successful over time in many business sectors. Although a problem for ENOC was identified as the resistance to change. The adaptability by employees to change can be highly increased when the leadership and top management are well trained in the method and drive the change (Galadari et al., 2013). The “demand pull model” was evaluated by Hannon, Foxon, and Gale (2015). The researchers recommended that ESCos can benefit from PPS and offered ideas of how government policy can be developed to support energy related businesses. Policy support must be coupled with customer satisfaction because meeting the demands is the number one imperative for business success (Hannon et al., 2015). Poupeau (2009) identified the importance of the gas distribution networks on customer satisfaction. Keranen and Jalkala (2013) carried out a research project specifically designed to engage individuals in the UAE. Their methods were highly successful, so their research method should be studied when undertaking studies in the UAE that are energy and environmentally related.
References
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Sunith Bandaru, Abhinav Gaur, Kalyanmoy Deb, Vineet Khare, Rahul Chougule, Pulak Bandyopadhyay, Development, analysis and applications of a quantitative methodology for assessing customer satisfaction using evolutionary optimization, Applied Soft Computing, Volume 30, May 2015, Pages 265-278, ISSN 1568-4946, http://dx.doi.org/10.1016/j.asoc.2015.01.014.
“ENOC achieves impressive milestones in customer satisfaction, Emiratisation and operational efficiency through application of Balanced Scorecard” (2013). Al bawaba http://www.albawaba.com/business/pr/enoc-custo mer-satisfaction-499618
Ghazal, M., Muhammad Akmal, Shilpa Iyanna, Kilani Ghoudi, (2015). Smart plugs: Perceived usefulness and satisfaction: Evidence from United Arab Emirates, Renewable and Sustainable Energy Reviews, Volume 55, March 2016, Pages 1248-1259, ISSN 1364-0321, http://dx.doi.org/10.1016/j.rser.2015.07.096.
Hannon, M.J., Timothy J. Foxon, & William F. Gale. (2015). ‘Demand pull’ government policies to support Product-Service System activity: the case of Energy Service Companies (ESCos) in the UK, Journal of Cleaner Production, Volume 108, Part A, 1 December 2015, Pages 900-915, ISSN 0959-6526, http://dx.doi.org/10.1016/j.jclepro.2015.05.082.
Keränen, J. & Anne Jalkala. (2013). Towards a framework of customer value assessment in B2B markets: An exploratory study, Industrial Marketing Management, Volume 42, Issue 8, November 2013, Pages 1307-1317, ISSN 0019-8501, http://dx.doi.org/10.1016/j.indmarman.2013.06.010.
Lee, K.J., Casalegno, F., 2010. An explorative study for business models for sustainability. In: Pacific Asia Conference on Information Systems (PACIS) 2010 Proceedings.
Poupeau, F-M. (2009). Domestic customers and reform of the gas sector. An organisational sociology perspective, Energy Policy, Volume 37, Issue 12, December 2009, Pages 5385-5392, ISSN 0301-4215, http://dx.doi.org/10.1016/j.enpol.2009.07.061.
Weisner, M. (2015). “There are no quick fixes for Emiratisation targets.” Gulf News. http://gulfnews.com/business/sectors/careers/there-are-no-quick-fixes-for-emiratisation-targets-1.1592685
