Impact of Fluctuating Economy on Organisational Restructuring

Question: Discuss about the Impact Of Fluctuating Economy On Organisational Restructuring In Adma-Adnoc. Answer: Research Overview As per the annual report of ADMA-ADNOC, the lower price of oil has redesigned the budget of Abu Dhabi National Oil Company. It has been speculated that although investing more in the research and development process, the firm has to reduce the operational expenditure by 10-15% in the last year (www.adnoc.ae, 2016). But the management of the firm has assured that the cut back process would not affect the job opportunities of the firm. According to the opinion of Fujita and Koji (2008), the sudden hike in the price of a barrel (US$65 per barrel) has forced most of the companies to trim the company budget. Adding to this, the oil production capacity of 3.5 million barrels per day (BPD) within three years of 3 million BPD is the main reason to decrease the operational expenditure. The current study attempts to investigate the effectiveness of the fluctuating economy on organisational restructuring in Abu Dhabi National Oil Company (ADMA-ADNOC), Abu Dhabi. While conducting the research wo rk, the proposal would construct a gap analysis of the present topic and as well as a strategic recommendation and a methodological framework would also be critically analysed. Key research questions What are the factors leading to the fluctuation in the regional economy of Abu Dhabi? Which factors of fluctuating economy significantly influence the overall organisational policy of ADMA-ADNOC? What is the significance of fluctuating economy on organisational restructuring in ADMA-ADNOC, Abu Dhabi? What would be the strategic initiatives to facilitate management to implement the business model that mitigates the organisational changes due to economic fluctuation in Abu Dhabi? Literature review The factors leading to the fluctuation in the regional economy of Abu Dhabi The one possible cause of economic fluctuation is a little alteration in the aggregate demand. The price of the essential commodities falls in the short period while demand curves shift. In this current context, Shin (2010) stated that the foremost economic contributor of the country is the oil reserves and the oil production. It has been found that the UAE has the 30% worlds proven oil reserves. The country can produce 3.5 million barrels per day. The sudden disruption in the aggregate demand has forced the firm to reduce the operational expenditure for sustaining in the market. On the other hand, the economic fluctuation can be happened due to the issues of a sudden alteration in aggregate supply. The GDP of the country can be varied due to this kind of short-run change in the economy (Gillespie, 2011). The sudden dropped down situation of the oil sector has minimised the GDP value of the country by 40%. Hence, the firm has adopted certain essential changes to increase the oil reco very rates in the current situation of economic fluctuation. Factors of fluctuating economy hampering the organisational policy The report of 2009 depicts that a slide in the international crude oil has collapsed the fuel trading capacity of the ADMA-ADNOC. In the framework of the present statement, Anderson and Anderson (2009) mentioned that the fuel industry in Abu Dhabi had experienced a slide of 80%. The specific economic condition of the region has created an adverse impact on the oil production capacity of ADMA-ADNOC. According to Bednar and Green (2011), the state petroleum group has attained an appreciation for its technical competencies. However, a sudden shift in the price margin has enforced the organisation to undergo an anti-corruption purge, which influenced the management to include the higher level of bureaucracy within the organisation. According to Research et al. (2013), the bureaucratic initiation helped Adma-Opco to enhance its production capacity up to 700,000 b/d by the end of 2014 and 600,000 b/d in the current year. The significance of fluctuating economy on organisational restructuring in ADMA-ADNOC, Abu Dhabi There is several significant effectiveness of the fluctuating economy on the organisational reconstructing in ADMA-ADNOC, Abu Dhabi. The sliding down of the oil price has directly impacted on the economic diversification in the Arab nations. The oil companies of the nation are currently struggling with fewer financial buffers to preserve the specific growth rate. In the opinion of Gillespie (2011), the organisation, ADMA-ADNOC, Abu Dhabi required reformulating the budget by minimising the current expenditure. It has been identified that the companies across the industry have to cut back the expenditure and the other operational cost due to the issue of lower oil price. The annual report of the firm indicates that Shell, who is the main partner of the ADMA-ADNOC on its BAB sour gas project, has minimised the capital expenditure more than of the expectations (www.adnoc.ae, 2016). Although the management of the firm assured that there are no long-term issues that can affect the operatio nal activities of the firm due to such short-term fluctuations. Moreover, the firm has to tighten the operating budget due to the effect of sudden fluctuation in the economic growth rate. Recommended business model mitigating the organisational change issues Limiting the nominal expenditure would be the suitable action needed to be initiated by the management of ADMA-ADNOC in Abu Dhabi. Considering the opinion of Van Dijk and Van Dick (2009), it could be inferred that during the tenure of fluctuation the management needs to decrease its nominal expenditure to maintain the existing line of profit margin. Although the management of ADMA-ADNOC has taken the initiatives of reducing the price margin in its product lines, yet, similarly the nominal expenditure is required being reduced (Ball and Garcia-Lorenzo, 2013). The inflation in the economy would last for short time tenure. Therefore, the excessive investment might reduce the value of the assets and would serve minimal utility to the firm. Research Methodology Research Philosophy The research philosophy can be categorised into three major aspects, i.e. positivism, realism and interpretive. According to the opinion of Thomas (2015), the positivism philosophy follows the scientific method, whereas, the realism philosophy deals with the element that is mostly acquainted with the human presence. On the other hand, interpretive philosophy is entirely based on the human insight and knowledge related to the research context. In the current study, the researcher would choose the positivism philosophy that as it is helpful to identify the impact of fluctuating economy on organisational restructuring. The decision making an approach and the behavioural action of this specific philosophy is influencing to arrive at an authentic conclusion (Hirsh, 2008). Thus, scientific technique of positivism philosophy would assist the researcher to derive an accurate conclusion for the current research context. Research Approach There are two types of research approaches which includes deductive and inductive. As per the opinion of Fallman (2008), the deductive approach focuses on studying the related theory and hypothesis related to the current topic for drawing a prospective outcome. On the contrary, the inductive approach itself is a theory building approach (Bowman, 2008). As per the current requirement, the research associate would require a theory-testing approach. Thus, the deductive approach would be considered. Furthermore, the deductive approach follows the design of waterfall model on the basis of the research objectives. Thus, to investigate the current findings the deductive research approach would be chosen, which would help to scrutinise the factors of fluctuating economy in ADMA-ADNOC. Research design The research design can be categorised into the followings: descriptive, exploratory and explanatory design. In the opinion of Popping (2012), exploratory research design is required in the case of minimal data resources. However, the explanatory is required where the existing theories cannot address the research problem. Moreover, the descriptive research design deals with the generated outcomes associated with the research questions. In this present study, a descriptive research design would be selected to allow the several developments regarding the current research topic. Hence, it could be deduced that descriptive research design would be effective to conduct the current research. Research Strategy The research strategy can be encompassed with a survey, case study and experiment. Considering the opinion of Fallman (2008), research associate would consider the case study analysis to find the research solution. The strategy of case study analysis would help the researcher to accumulate the required data for the current research context. In the opinion of Hirsh (2008), the entire data for the current study would be collected through the help of a case study analysis as it would be effective to understand the impact of the fluctuating economy of ADMA-ADNOC, Abu Dhabi. Therefore, it would be possible to evaluate the corporate information to validate the case study research strategy. Data collection process Primary Data Collection The qualitative data collection would be considered for the current study by organising face-to-face interview round. The managers of ADMA-ADNOC, Abu Dhabi, would be chosen for the round of face-to-face interview. The given feedbacks from the managers would be considered as the qualitative data for the current research. According to the guidance of Bowman (2014), it is essential to check the managers availability before conducting the interview session. The research associate would evaluate all the responses of the managers as the qualitative data for the current research topic. Secondary Data Collection The secondary information for the present study would be collected from the various journals, articles, official website of the firm and the other relevant books. In this current scenario, Thomas (2015) stated that journals, books and the articles are the most reliable sources to gather the information for secondary data collection. Hence, the researcher would critically review the several e-books, articles, e-journals for collecting the secondary data. Adding to this, the researcher would need to keep special attention for avoiding the data duplicity issues. Data Analysis The data analysis plan would be preceded by considering the time frame for the data collection process. In the present proposal, the researcher would consider both the primary and the secondary analysis process. For the primary data collection process, the researcher would consider the qualitative approach. Moreover, Chadwick (2016) determined that the qualitative responses are descriptive in nature. Therefore, it cannot be illustrated with feasible graphs and charts. Considering the above assertions, the researcher would keep the qualitative data in the descriptive format and execute the raw feedbacks that would be collected from the executive personals. The secondary details would be gathered from the sources like journals, books, magazines and websites and would be triangulated with the primary responses for the authentication purpose. Finally, the researcher would initiate a data triangulation process between the primary and the secondary subject for the research authentication p urpose. Sampling process In the present study, the researcher would consider the non-probability sampling process. Since, the researcher would plan to conduct the qualitative approach. In the specific project, the researcher would be conducting the personal interview round with the executive personals. The professionals would be considered purposefully. According to Lim and Ting (2013), the information regarding organisational restructuring process can be provided only by the executive officials. Therefore, the researcher would interview four executive officials to gather relevant information regarding the impact of fluctuating economy on ADMA-ADNOC, Abu Dhabi. Thus, the qualitative sample size would be limited to 4. The secondary information would be collected from different journals, books, magazines, e-library and the corporate websites. Types of investigation The research investigation is comprised of two forms, quantitative and qualitative (McClelland and Fine, 2008). In the present research study, the researcher would include the qualitative subjects. The existing research is the social content. Thus, the qualitative technique would facilitate the readers to have an in-depth knowledge regarding the impact of fluctuating economy on organisational restructuring in the ADMA-ADNOC, Abu Dhabi (Foss, 2009). Moreover, the qualitative subject is not quantifiable in nature. Therefore, the researcher would emphasise more on the quality. The qualitative feedbacks would be collected from the internal professionals of the chosen enterprise. Hence, the chances of receiving the standardised responses would be relatively more, which would benefit the researcher to derive a genuine conclusion. The executive personals would be questioned regarding the impact of the fluctuating economy on the organisational process. Ethical considerations Garcilln and Ezcurra (2011) following the ethical standards would help the researchers to enhance the standards of the study by reducing the chances of data manipulation. The ethical measures often create distinctions between the satisfactory and unsatisfactory behaviour of the respondents (Maistrenko, 2015). In the existing research proposal, the researcher would ensure a free and fair process. The information received from the executive personals would be kept confidential. None of the internal data would be disclosed to any of the third parties. The corporate details would be used singly for the research purpose and be destroyed immediately after the completion of the research proposal. For the security purpose, the identity of the professionals would not be disclosed in public. Research limitation Accumulation of the secondary details can be a huge limitation of the study (Freshwater,). The research topic is highly elusive; therefore, it would be difficult for the researcher to collect the update secondary details within the short time span. Moreover, the executive personals might present a reluctant attitude on the interview process. The executive individuals might be busy with the individual schedules, therefore, arranging a mutual time might not be possible to the researchers. This might delay the delivery time of the study, or high pressure of in-time submission might reduce the quality of the research process. Hence, the derived conclusion might not be exclusively authentic. However, the data triangulation might serve the purpose of reducing the impact of above limitations. Research outcomes The present evaluates the impact of fluctuating economy on organisational restructuring in ADMA-ADNOC, Abu Dhabi. Evaluating the current study, an inference can be drawn that the economic fluctuations have led the enterprise to reduce the price margin of the oil segment. However, the specific organisation has also introduced the higher bureaucracy model, which has led to employee dissatisfaction. Moreover, the economic fluctuations had led the enterprise to cut down on its operational expense and to maintain the profit margin. The specific action has created a direct impact on the oil production capacity of the organisation. However, the reduction in the oil price margin has benefitted the firm to increase its capacity up to 700,000 b/d. Timescale The timetable consists of the indifferent tasks that bear considerable significance in the research purpose. The time schedules are framed by considering the nature of the tasks. Thus, the study is expected to finish by the completion time. Each of the activities is assigned with single weeks for the completion. Therefore, the researcher would get sufficient time to gather and analyse the data. The final outcomes would be followed with suitable recommendations on the final week. Topics Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Introduction Framing of the aim and objectives of the study Secondary data collection process Evaluation of the research Methodology Accomplish of the qualitative responses. Triangulation between the primary and secondary subjects Conclusion and recommendation Table: Gantt chart (Source: self-developed) References: ADNOC (2016) Available at: https://www.adnoc.ae/en/home/index.aspx (Accessed: 31 August 2016). Anderson, D.L. and Anderson, C. (2009)Organization development: The process of leading organizational change. Thousand Oaks: SAGE Publications. Ball, D. and Garcia-Lorenzo, L. (2013) A very personal process,Change Management: An International Journal, 12(1), pp. 116. Bednar, P.M. and Green, G.M. (2011) Same business same system? A critique of organization and the information systems process,Journal of Organisational Transformation Social Change, 8(2), pp. 199213. Bowman, J. 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