| Abstract | In every business, Contract activities play an important role in its operation because every
business is conducted under contracts between related parties. In the petroleum industry,
the Contract and Procurement (C&P) activities are very important, complicated and
challenging because the values of contracts are very high (could be up to tens of millions of
dollars), and the nature of equipments and services are complicated and highly risky,
involving high technologies. In addition, not like many other popular consumer products,
the bargaining power of petroleum contractors, especially of global service providers, is
high, which makes the oil and gas producers (users of services) a lot of difficulties in
dealing with C&P matters. Therefore, the question of improving C&P activities of JPEC
(the analysed case) is useful and critical. In particular, those challenging activities in the
C&P activities are Negotiation with contractors, Communication and Conflict Management
between the joint working teams in JPEC. Communication and Conflict Management is
usually the critical problem in oil and gas operation because, for a company like JPEC, it
usually has its technical groups and the other non-technical groups. The technical group
plays an important role in production which requires high technical knowledge and skills.
Meanwhile the non-technical groups deal with other non-technical issues such as
contractual matters, logistics and others. The problem is that no single group could handle
the entire works to make a successful business. There must be a joint work of the technical
and non-technical groups to make the business go on right track. However, it is usually to
see problems in Communication and Conflict Management between such joint working
groups, which have been causing highly adverse impacts on business performances.
This Research has been conducted based on the analysis and contrast between the actual
C&P operation of JPEC, actual experiences and theoretical concepts. The research has
come out with some suggested guidelines for handling Negotiation and Conflict
Management, as well as the solutions to enhance communication efficiency in general
between the joint working groups of an oil and gas company—JPEC. |