Schlumberger Company
I. Organizational Background
The Schlumberger is one of the world’s leading companies in oil field services industry. It
has operations in approximately 80 countries. The firm offers a complete range of oil and gas
services, including engineering, construction, and project management. Schlumberger has
over 126,000 employees, does business around the world. The company features in the
Fortune's Best 500 companies to work for, mainly due to its employee focus, and HR
practices. Some of the best HR practices of the firm are in the areas of gender diversity, an
equal opportunity employer, engagements with the best schools in the world, family and
work life balance support and no 'Glass Ceiling'.1. The fundamental challenge for
Schlumberger’s human resource management, much like the other oil and gas companies
based in Saudi Arabia, is attracting and keeping the right talented personnel to work for the
company. Attracting and keeping the right people—a fundamental human resource
management issue—is an ongoing challenge. Schlumberger and other large companies in
energy-related industries depend heavily on a steady inflow of new employees. But an aging
workforce and an unevenly distributed supply of talent continues to create challenges. For
instance, there is a significant shortage of geosciences and petroleum engineering students in
both North America and the Middle East—the very regions where more people are needed.
It tries to adopt an open recruitment policy, with both sexes, multiple nationalities and fresh
graduates all making up the workforce.
Within Schlumberger however, one of greatest strengths is the diversity of our workforce,
where men and women of many nationalities and backgrounds work together and share
objectives. Schlumberger has made significant investment in their operating infrastructure,
including the oilfield services base in Udhailiyah, a new well testing base in Al-Khobar, and
upgrades to their existing oilfield services bases in Al-Khobar and Al-Khafji. Schlumberger
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has consistently invested in competent personnel, state-of-the-art technology and service
quality delivery systems; all in the pursuit of adding value to our customer's operations. The
recent addition of the Dhahran Carbonate Research Centre, the construction of new facilities
reinforces Schlumberger's long-term commitment to Saudi Arabia. With the new research
centre and a growing presence, Schlumberger hopes to be on the front line of any future
development in the field.
II. Organizational Structure
III. Mission and Vision
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Knowledge, technical innovation and teamwork are at the center of who we are. For more
than 8 years, we have focused on leveraging these assets to deliver solutions that improve
customer performance.
An International Technical Company providing products and services that improve the
productivity of our customers.
IV. SWOT Analysis
Schlumberger maintains its dominant position in market by critically analyzing and
reviewing the SWOT analysis.
Strengths of Schlumberger
Strengths are the firm's capabilities and resources that it can use to design, develop, and
sustain competitive advantage in the marketplace
- Track record of innovation - Even though most players in the Energy strive to innovate,
Schlumberger has successful record at consumer driven innovation.
- Market Leadership Position - Schlumberger has a strong market leadership position in the
Oil Well Services & Equipment industry. It has helped the company to rapidly scale new
products successes.
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- Success of new product mix - Schlumberger provides exhaustive product mix options to its
customers. It helps the company in catering to various customers segments in the Oil Well
Services & Equipment industry.
- First mover advantage in the increasingly crowded market place. The new products are
rapidly increasing Schlumberger market share in the Oil Well Services & Equipment
industry.
- Brands catering to different customers segments within Oil Well Services & Equipment
segment - Schlumberger extensive product offerings have helped the company to penetrate
different customer segments in Oil Well Services & Equipment segment. It has also helped
the organization to diversify revenue streams.
- Talent management at Schlumberger and skill development of the employees - Human
resources are integral to the success of Schlumberger in Oil Well Services & Equipment
industry.
Weaknesses of Schlumberger
Weaknesses of Schlumberger can either be absence of strengths or resources of capabilities
that are required but at present the organization doesn't have. Leaders have to be certain if the
weakness is present because of lack of strategic planning or as a result of strategic choice.
- Business Model of Schlumberger can be easily imitated by the competitors in the
industryname industry. To overcome these challenges company name needs to build a
platform model that can integrate suppliers, vendors and end users.
- Extra cost of building new supply chain and logistics network - Internet and Artificial
Intelligence has significantly altered the business model in the Energy industry and given the
decreasing significance of the dealer network Schlumberger has to build a new robust supply
chain network. That can be extremely expensive.
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- Low investments into Schlumberger's customer oriented services - This can lead to
competitors gaining advantage in near future. Schlumberger needs to increase investment into
research and development especially in customer services oriented applications.
- Gross Margins and Operating Margins which could be improved and going forward may put
pressure on the Schlumberger financial statement.
- Declining per unit revenue for Schlumberger - competitiveness in the industry name
industry is putting downward pressure on the profitability. A starting guide to manage this
situation for company name is – objectively assessing the present value propositions of the
various products.
- Niche markets and local monopolies that company’s like Schlumberger able to exploit are
fast disappearing. The customer network that Schlumberger has promoted is proving less and
less effective.
Opportunities for Schlumberger
- Increasing customer base in lower segments - As customers have to migrate from un-
organized operators in the Energy industry to licensed players. It will provide Schlumberger
an opportunity to penetrate entry level market with a no-frill offering.
- Rapid Expansion of Economy As the US economy is improving faster than any other
developed economy, it will provide Schlumberger an opportunity to expand into the US
market. Schlumberger already have know-how to operate into the competitive US market.
- Lower inflation rate - The low inflation rate bring more stability in the market, enable credit
at lower interest rate to the customers of Schlumberger. This will increase the consumption of
Schlumberger products.
- Opportunities in Online Space - Increasing adoption of online services by customers will
also enable Schlumberger to provide new offerings to the customers in Oil Well Services &
Equipment industry.
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- Local Collaboration - Tie-up with local players can also provide opportunities of growth for
the Schlumberger in international markets. The local players have local expertise while
Schlumberger can bring global processes and execution expertise on table.
- Lowering of the cost of new product launches through third party retail partners and
dedicated social network. Schlumberger can use the emerging trend to start small before
scaling up after initial success of a new product.
Threats To Schlumberger
- Growing technological expertise of local players in the export market - One of the biggest
threat of tie-up with the local players in the export market for Schlumberger is threat of losing
IPR. The intellectual property rights framework is not very strong in emerging markets
especially in China.
- Shortage of skilled human resources - Given the high turnover of employees and increasing
dependence on innovative solution, company name can face skilled human resources
challenges in the near future.
- Commoditization of the product segment - The biggest challenge for Schlumberger and
other players in the industry is the increasing commoditization of the products in Energy
industry.
- Competitors catching up with the product development - Even though at present the
Schlumberger is still leader in product innovation in the Oil Well Services & Equipment
segment. It is facing stiff challenges from international and local competitors.
- Distrust of institutions and increasing threat of legal actions for Schlumberger - As the
WTO regulations and laws are difficult to enforce in various markets. Legal procedures have
become expensive and long drawn process. It can lead to less investment into emerging
markets by Schlumberger thus resulting in slower growth.
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- Competitive pressures - As the new product launch cycles are reducing in the Energy
industry. It has put additional competitive pressures on players such as Schlumberger. Given
the large customer base, Schlumberger can't respond quickly to the needs of the niche
markets that disruptors are focusing on.
V. HR Strategies
Schlumberger adopt an aggressive and innovative human resource strategy that is based on
diversity and partnerships with colleges and universities. As a result, the firm has long hired
in every country where it operates. In addition, it took a geocentric approach to all of its
global assignments, hiring the best people regardless of where they are from and moving
them to work assignments that are mutually beneficial regardless of the location of those
assignments. Schlumberger also established a long-term emphasis on hiring and developing
female engineers. As a result of these efforts, Schlumberger has maintained a human resource
advantage over many of its key competitors. But these same competitors have shown
creativity of their own as they, too, have taken a more global and integrated approach to
human resource management. For one thing, other firms in the industry often look to current
Schlumberger employees when they need to recruit experienced people.
1. Emphasize variable pay rather than base salary. By offering less base pay and bigger
bonuses based on company performance firms reduce their downside risk. During good
times, employees get more when the firm can afford it, and during industry downturns,
the company stops the bonuses and pays less when they can’t afford it. This keeps labor
costs high during good times, but low after downturns.
2. Emphasize cheap benefits. Some benefits, such as flex-time and telecommuting are
highly valued by employees, but cost relatively little monetarily. Thus, while other
benefits might have to be cut during tough times, cheaper ones don’t — keeping
employees happy without much expense.
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3. Use contractors when feasible. Staffing with contractors allows firms to choose to not
renew contracts during difficult times without incurring all the expense and emotional
toil of lay-offs. In downturns, before resorting to layoffs, be creative in reducing the
workforce voluntarily. Firms should consider offering unpaid leave, part-time
employment, early retirement, and job sharing as ways to cut labor costs without
resorting to layoffs. Also, consider transferring employees to unaffected divisions or
growth areas before resorting to layoffs. If layoffs are absolutely necessary, treat
employees with respect, honesty, and provide whatever support you can. This will help
attract, retain, and re-acquire talent once there’s an upturn and employees have options
again.
VI. Competitors
Weatherford, C&J Energy Services, CGG, NABORS, HalliBurton
Smaller companies : FMC Technologies and Nabor Industries
VII. Potential benefit of Environmental scanning
To maintain the competitive advantages Schlumberger gets from its workforce, the firm
continues to develop and implement new systems, policies, and practices to retain the strong
workforce it has attracted. For example, a rigorous, comprehensive training and development
program helps keep its engineers at the forefront of their fields. Competitive salaries and
performance-based incentives help retain the best and brightest of its employees, and well-
defined career paths help Schlumberger continue to grow and nourish the talent it needs to
thrive in an increasingly competitive world. It will provide the decision makers with a better
understanding of market, organization, and competitors. Managers at Schlumberger can also
use SWOT analysis to understand how key strengths can be extended either to adjacent areas
or new industries all together. Analyzing the macro trends from not only Energy industry
perspective but from a more holistic perspective. It will provide better clues regarding where
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customers are going and what trends Schlumberger can leverage. HR managers are also
responsible for creating a suitable work environment for every employee recruited for the
new project. The HR should drive interactive sessions, motivational work groups, and
discussion forums to enable early detection of demotivation and prompt resolution.The HR
strategy should dynamically change to support the technological advancement in each
business groups and develop leaders who can translate business needs into digital solutions.
Therefore, the industry has a dynamic approach inbuilt into its management practices. The
HR executives usually find it difficult to evolve a long-term framework because of the
changes being effected in the management strategies of the industry. This not only greatly
affects the delivery but also makes them apprehensive about following long-time HR
policies. One of the trickiest challenges for HR executives would be retaining their top talents
and finding suitable replacements in case of attrition. The company makes a considerable
investment to train and groom the recruits to become subject matter experts in due course of
time. Thus the HR team needs a long-term and sustainable approach towards managing the
work-life balance of these employees, provide timely rewards & recognitions, and bring in
the sense of empowerment by upskilling them. Overcoming the various challenges, ensuring
sound HR practices and strategies can thus develop strong talent culture and a more resilient
organization.
VIII. Recommendation
Schlumberger should conduct comprehensive training and development program that can
helps keep its engineers at the forefront of their fields.
Schlumberger should Analyzing the macro trends from not only Energy industry
perspective but from a more holistic perspective. It will provide better clues regarding
where customers are going and what trends Schlumberger can leverage.
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Schlumberger gets from its workforce, the firm should continue to develop and
implement new systems, policies, and practices to retain the strong workforce it has
attracted.
IX. References
A. D. Chandler, (1962), “Strategy and Structure”. Cambridge, Mass.: MIT Press.
Euromonitor, (2018), “Energy Sector Analysis” , Published in 2018.
Hui Shan, (2018), “Key HR Challenges in the Oil and Gas Industry”. NrgBuzz4.
Indrajit Sen, (2016), “Schlumberger Limited: Schlumberger opens facility in Saudi Arabia”.
Arabian Industry.
Julie Bonnin, (2019), “HR Strategies for Oil & Gas”. The University of Houston.
L. Wrigley, (1970), “Divisional Autonomy and Diversification”. PhD, Harvard Business
School.
M. E. Porter, (1980), “Competitive Strategy”. New York: Free Press.
O. E. Williamson, (1975), “Markets and Hierarchies”. New York: Free Press.
R. E. White, (1986), “Generic Business Strategies, Organizational Context and Performance:
An Empirical Investigation”. Strategic Management Journal7.
Schlumberger, (2018), “Schlumberger Annual Report”, Published in 2018.
The Schlumberger is one of the world's driving organizations in oil field administrations
industry. It has tasks in roughly 80 nations. The firm offers a total scope of oil and gas
administrations, including building, development, and undertaking the board. Schlumberger
has more than 126,000 representatives, works together around the globe. The organization
includes in the Fortune's Best 500 organizations to work for, principally because of its
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worker center, and HR rehearses. Probably the best HR practices of the firm are in the zones
of sexual orientation assorted variety, an equivalent open door boss, commitment with the
best schools on the planet, family and work life balance support and no 'Glass Ceiling'.1. The
principal challenge for Schlumberger's human asset the executives, much like the other oil
and gas organizations situated in Saudi Arabia, is pulling in and keeping the privilege skilled
staff to work for the organization. Drawing in and keeping the ideal individuals—an essential
human asset the board issue—is a progressing challenge. Schlumberger and other huge
organizations in vitality related businesses depend intensely on an unfaltering inflow of new
representatives. Yet, a maturing workforce and an unevenly appropriated supply of ability
keeps on making difficulties. For example, there is a huge deficiency of geosciences and oil
building understudies in both North America and the Middle East—the very areas where
more individuals are required.
It attempts to embrace an open enlistment arrangement, with both genders, various
nationalities and crisp alumni all creation up the workforce.
Inside Schlumberger be that as it may, one of most prominent qualities is the assorted variety
of our workforce, where people of numerous nationalities and foundations cooperate and
share targets. Schlumberger has made critical interest in their working framework, including
the oilfield administrations base in Udhailiyah, another well testing base in Al-Khobar, and
moves up to their current oilfield administrations bases in Al-Khobar and Al-Khafji.
Schlumberger has reliably put resources into equipped work force, best in class innovation
and administration quality conveyance frameworks; all in the quest for increasing the value
of our client's activities. The ongoing expansion of the Dhahran Carbonate Research Center,
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the development of new offices fortifies Schlumberger's long haul pledge to Saudi Arabia.
With the new research focus and a developing nearness, Schlumberger plans to be on the
forefront of any future advancement in the field.
Mission and Vision
Information, specialized advancement and collaboration are at the focal point of our identity.
For over 8 years, we have concentrated on utilizing these advantages for convey
arrangements that improve client execution.
An International Technical Company giving items and administrations that improve the
efficiency of our clients.
SWOT Analysis
Schlumberger keeps up its prevailing position in market by fundamentally examining and
checking on the SWOT examination.
Qualities of Schlumberger
Qualities are the company's capacities and assets that it can use to configuration, create, and
continue upper hand in the commercial center
- Track record of advancement - Even however most players in the Energy endeavor to
develop, Schlumberger has fruitful record at buyer driven advancement.
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- Market Leadership Position - Schlumberger has a solid market initiative position in the Oil
Well Services and Equipment industry. It has helped the organization to quickly scale new
items triumphs.
- Success of new item blend - Schlumberger gives thorough item blend alternatives to its
clients. It helps the organization in obliging different clients portions in the Oil Well Services
and Equipment industry.
- First mover advantage in the undeniably jam-packed commercial center. The new items are
quickly expanding Schlumberger piece of the overall industry in the Oil Well Services and
Equipment industry.
- Brands obliging diverse clients fragments inside Oil Well Services and Equipment portion -
Schlumberger broad item contributions have helped the organization to enter distinctive
client sections in Oil Well Services and Equipment portion. It has likewise helped the
association to differentiate income streams.
- Talent the executives at Schlumberger and ability advancement of the representatives -
Human assets are vital to the achievement of Schlumberger in Oil Well Services and
Equipment industry.
Shortcomings of Schlumberger
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Shortcomings of Schlumberger can either be nonattendance of qualities or assets of abilities
that are required however at present the association doesn't have. Pioneers must be sure if the
shortcoming is available due to absence of key arranging or because of key decision.
- Business Model of Schlumberger can be effectively imitated by the rivals in the
industryname business. To beat these difficulties organization name needs to fabricate a stage
demonstrate that can coordinate providers, merchants and end clients.
- Extra expense of structure new inventory network and coordinations organize - Internet and
Artificial Intelligence has essentially changed the plan of action in the Energy business and
given the diminishing noteworthiness of the seller arrange Schlumberger needs to fabricate
another powerful store network arrange. That can be very costly.
- Low speculations into Schlumberger's client situated administrations - This can prompt
contenders picking up preferred standpoint in not so distant future. Schlumberger needs to
expand venture into innovative work particularly in client administrations situated
applications.
- Gross Margins and Operating Margins which could be improved and going ahead may put
weight on the Schlumberger fiscal report.
- Declining per unit income for Schlumberger - intensity in the business name industry is
putting descending weight on the productivity. A beginning manual for deal with this
circumstance for organization name is – unbiasedly surveying the present offers of the
different items.
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- Niche markets and neighborhood imposing business models that organization resembles
Schlumberger ready to abuse are quick vanishing. The client organize that Schlumberger has
advanced is demonstrating less and less successful.
Open doors for Schlumberger
- Increasing client base in lower portions - As clients need to relocate from un-composed
administrators in the Energy business to authorized players. It will give Schlumberger a
chance to enter passage level market with a no-ornamentation advertising.
- Rapid Expansion of Economy As the US economy is improving quicker than some other
created economy, it will give Schlumberger a chance to venture into the US advertise.
Schlumberger as of now have know-how to work into the focused US showcase.
- Lower expansion rate - The low swelling rate acquire greater solidness the market,
empower credit at lower loan cost to the clients of Schlumberger. This will expand the
utilization of Schlumberger items.
- Opportunities in Online Space - Increasing appropriation of online administrations by
clients will likewise empower Schlumberger to give new contributions to the clients in Oil
Well Services and Equipment industry.
- Local Collaboration - Tie-up with neighborhood players can likewise give chances of
development to the Schlumberger in worldwide markets. The neighborhood players have
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nearby aptitude while Schlumberger can expedite worldwide procedures and execution ability
table.
- Lowering of the expense of new item dispatches through outsider retail accomplices and
committed interpersonal organization. Schlumberger can utilize the rising pattern to begin
little before scaling up after beginning accomplishment of another item.
Dangers To Schlumberger
- Growing mechanical mastery of nearby players in the fare showcase - One of the greatest
danger of tie-up with the neighborhood players in the fare advertise for Schlumberger is risk
of losing IPR. The protected innovation rights system isn't extremely solid in developing
markets particularly in China.
- Shortage of gifted HR - Given the high turnover of workers and expanding reliance on
creative arrangement, organization name can confront talented HR challenges sooner rather
than later.
- Commoditization of the item section - The greatest test for Schlumberger and different
players in the business is the expanding commoditization of the items in Energy industry.
- Competitors making up for lost time with the item advancement - Even however at present
the Schlumberger is still pioneer in item development in the Oil Well Services and
Equipment fragment. It is confronting solid difficulties from universal and nearby contenders.
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- Distrust of foundations and expanding risk of legitimate activities for Schlumberger - As the
WTO guidelines and laws are hard to uphold in different markets. Lawful techniques have
turned out to be costly and long drawn procedure. It can prompt less speculation into
developing markets by Schlumberger in this manner bringing about slower development.
- Competitive weights - As the new item dispatch cycles are lessening in the Energy business.
It has put extra focused weights on players, for example, Schlumberger. Given the substantial
client base, Schlumberger can't react rapidly to the requirements of the specialty showcases
that disruptors are concentrating on.
HR Strategies
Schlumberger receive a forceful and imaginative human asset system that depends on decent
variety and organizations with schools and colleges. Accordingly, the firm has since quite a
while ago contracted in each nation where it works. What's more, it adopted a geocentric
strategy to the majority of its worldwide assignments, procuring the best individuals paying
little mind to where they are from and moving them to work assignments that are commonly
advantageous paying little heed to the area of those assignments. Schlumberger likewise
settled a long haul accentuation on contracting and creating female architects. Because of
these endeavors, Schlumberger has kept up a human asset advantage over a large number of
its key rivals. In any case, these equivalent contenders have appeared of their own as they, as
well, have taken an increasingly worldwide and coordinated way to deal with human asset the
executives. For a certain something, different firms in the business frequently look to current
Schlumberger representatives when they have to select experienced individuals.
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Accentuate variable pay instead of base compensation. By offering less base pay and greater
rewards dependent on organization execution firms diminish their drawback hazard. Amid
great occasions, workers get more when the firm can bear the cost of it, and amid industry
downturns, the organization stops the rewards and pays less when they can't manage the cost
of it. This keeps work costs high amid great occasions, yet low after downturns.
Underscore shoddy advantages. A few advantages, for example, strategic scheduling and
working from home are exceedingly esteemed by representatives, yet cost generally little
fiscally. In this manner, while different advantages may must be cut amid intense occasions,
less expensive ones don't — keeping representatives glad absent much cost.
Utilize temporary workers when attainable. Staffing with contractual workers enables firms
to decide to not reestablish contracts amid troublesome occasions without bringing about all
the cost and enthusiastic drudge of lay-offs. In downturns, before depending on cutbacks, be
imaginative in decreasing the workforce intentionally. Firms ought to think about offering
unpaid leave, low maintenance work, early retirement, and employment sharing as
approaches to slice work costs without turning to cutbacks. Likewise, consider exchanging
workers to unaffected divisions or development zones before falling back on cutbacks. In the
event that cutbacks are totally vital, approach workers with deference, genuineness, and give
whatever help you can. This will help pull in, hold, and re-secure ability once there's an
upturn and representatives have choices once more.
Contenders
Weatherford, C&J Energy Services, CGG, NABORS, HalliBurton
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Littler organizations : FMC Technologies and Nabor Industries
Potential advantage of Environmental checking
To keep up the upper hands Schlumberger gets from its workforce, the firm keeps on creating
and execute new frameworks, strategies, and practices to hold the solid workforce it has
pulled in. For instance, a thorough, complete preparing and advancement program helps keep
its designers at the front line of their fields. Focused pay rates and execution based motivators
help hold the best and most brilliant of its workers, and very much characterized vocation
ways help Schlumberger proceed to develop and support the ability it needs to flourish in an
inexorably aggressive world. It will give the chiefs a superior comprehension of market,
association, and contenders. Directors at Schlumberger can likewise utilize SWOT
investigation to see how key qualities can be stretched out either to nearby regions or new
enterprises all together. Investigating the large scale patterns from Energy industry viewpoint
as well as from an increasingly comprehensive point of view. It will give better insights with
respect to where clients are going and what patterns Schlumberger can use. HR chiefs are
additionally in charge of making a reasonable workplace for each worker selected for the new
task. The HR should drive intuitive sessions, persuasive work gatherings, and discourse
discussions to empower early recognition of demotivation and brief resolution.The HR
system ought to progressively change to help the mechanical headway in every business
gatherings and create pioneers who can make an interpretation of business needs into
advanced arrangements. In this manner, the industry has a dynamic methodology inbuilt into
its administration rehearses. The HR officials more often than not think that its hard to
develop a long haul system in light of the progressions being affected in the administration
methodologies of the business. This extraordinarily influences the conveyance as well as
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makes them uncertain about after long-lasting HR approaches. One of the trickiest difficulties
for HR administrators would hold their top gifts and finding appropriate substitutions if there
should arise an occurrence of steady loss. The organization makes a significant speculation to
prepare and prepare the volunteers to wind up topic specialists at the appointed time of time.
In this manner the HR group needs a long haul and supportable methodology towards dealing
with the work-life parity of these representatives, give opportune prizes and
acknowledgments, and get the feeling of strengthening by upskilling them. Conquering the
different difficulties, guaranteeing sound HR practices and procedures would thus be able to
create solid ability culture and a stronger association.
Suggestion
Schlumberger should lead far reaching preparing and advancement program that can helps
keep its architects at the front line of their fields.
Schlumberger ought to Analyzing the full scale patterns from Energy industry point of view
as well as from an increasingly all encompassing viewpoint. It will give better insights with
respect to where clients are going and what patterns Schlumberger can use.
Schlumberger gets from its workforce, the firm should proceed to create and actualize new
frameworks, approaches, and practices to hold the solid workforce it has pulled in.
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