Management Strategies in Chinese Oil and Gas Industry

1、Management Strategies in Chinese Oil and Gas IndustryIntroductionAs OPITO ,Offshore Petroleum Industry Training Organization ,is expanding its business into China, the management strategies to be used should be modified on the basis of original ones. This report aims to, firstly ,introduce some basi

2、c management theories, and then present management styles used at OPITO UK in the oil and gas industry. After taking cultural differences into considerations, appropriate management strategies for Chinese oil and gas industry are eventually proposed. Definitions of Management and LeadershipManagemen

3、t is about getting things done. Managers work in different ways to achieve many diverse and often specific objectives. The oil and gas industry contains many layers of management within many types of organization. Hierarchies are organizations that are structured in layers. The managers in the highe

4、r levels have more seniority than those further down.Leadership differs from management. Leadership encompasses the skills and qualities needed to inspire others to achieve goals. Leaders can see the heart of a problem and suggest solutions; they have a positive self image; they tend to be creative;

5、 they are often experts in a field and can sense change and respond accordingly.Management Styles Used at OPTITO UKThe role of OPITO - The Oil & Gas Academy is to help employers todeve- lop a safe and competent workforce. Since the oil and gas industry employs people in a variety of job roles, b

6、oth offshore and onshore, in all sorts of expertise and professions , including drilling ,production,opera- tion and negotiation, therefore a variety of management styles may be used in different contexts.When providing management and leadership training in the oil and gas industry, OPITO UK mainly

7、adopts three management styles: autocratic management, democratic management and paternalistic management.Autocratic management occurs especially in the situation where rules and procedures must be followed to assure safety, such as standard- makingthat deals with assessing risk, manual handling, wo

8、rking safely, working at height orlifting. This is mainly aimed at lower-layer employees. However, in most cases, democratic management are more widely used to nurture more competent workforce and create an equal atmosphere. In this situation information is being passed up through the hierarchy to a

9、id thedecision making. This is mainly aimed at higher layer employees, like engineers. In addition, Sometimes paternalistic style are adopted to have the employees best interests atheartregard- ing matters in assuring a well-rounded, safe, rewarding and challenging workenvironment for every employee

10、s.Cultural Considerations for Management in ChinaIt is obvious that in different cultural backgrounds, management styles are quite different. it is unwise to move those management strategies in the UK to Chinese companies without any modifications. According to relevant data, there are striking cont

11、rast in the pervasive management styles of the Britishand Chinese companiesin terms of dimensions of national cultures.l Power distance:It describes the extent to which the less powerful members of organizations and institutions accept and expect that power is distributed unequally. In British cultu

12、re, low power distance dominates. So it creates a democratic atmosphere and flatter organizational structure, which encourages more upward communication.While China is a more centralized country, with high power distance. Hierarchies do exist in the organization and upward communication is often dis

13、couraged. Many employees tend to wait for orders or instructions from managers instead of consultation.l Individualism/collectivismIndividualism versus collectivism is the degree to which individuals are inte-grated into groups. It is clear that individualism dominates in the British workplace. Indi

14、vidualistic cultures emphasize their achievements in job or private wealth. Employers should lay emphasis on achieving results through personal development.In contrast, Collectivistic cultures like China have a great emphasis on groups and think more in terms of “we”. Harmony and loyalty within a co

15、mpany is very important and should always be maintained and confrontation should be avoided. The relationship between employer and employee or business partners is based on trust and harmony and a deep understanding of moral values. The wealth of the company and the groups inside are more important

16、than the individual ones.l Masculine/Feminine:This dimension measures the value placed on traditionally male or female values.In so-called 'masculine' cultures, people value competitiveness, assertiveness, ambition, and the accumulation of wealth and material possessions. In so-called 'f

17、eminine' cultures, people value relationships and quality of life.In this term, UK is in a relatively high masculine culture ,and China is actually with medium masculinity. l High context/low contextHigh context culture relies heavily on subtle, often nonverbal cuesto maintain social harmony. Lo

18、w context culture uses language primarily to express thoughts, feelings and ideas as directly as possible. The UK is in low context, and China is in high context.In summary, the following table shows the different cultural characteristics in the UK and China as described above.Power distanceIndividu

19、alismMasculinityHigh context/low contextUKlowhighHighlowChinahighlowmediumhighBesides what is mentioned above, one fact that should be noticed is that the major oil and gas companies in china are: China National Offshore Oil Corp, China National Petroleum Corp, and Sinopec.- all state owned.The stat

20、us of state-owned enterprises (SOE) in China is somewhat special compared to other private companies. The once dominant state-owned enterprises (SOE) used to be themainstay of the iron rice bowl system, providing jobs for life and cradle-to-grave welfare. Recent moves by the government to modernize

21、the economy have beenforcing SOEs to become more efficient, and workers are increasingly being made redundant.But on the whole,it still enjoys perquisite in terms of employee benefits and redundancy under the protection of government policies.Recommendations for Management Strategies in ChinaLike th

22、e oil and gas industry in the UK, three styles of management approaches( autocratic management, democratic management and paternalistic management) are still basically adopted, but some details are revised according to specific cultural differences.l Performance managementIn Chinese oil and gas indu

23、stry, performance appraisals are thought highly of,so compared to UK companies, there should be more frequent appraisals on a regular basis and wider range of performance appraisal outcomes such as new targets,training,career assessment. But remember that in Chinese state-owed companies,pay ,benefit

24、s and positions remain exceptionally stable.When using democratic management, employees can be given some involvement in decision-making, but the extent to autonomy should be limited since China is centralized and high-power-distance country and some people tend to be dependable on their managers in

25、structions.l Job resourcesJob resources includes feedback,autonomy,development opportunities and task variety.It would be better to give feedback in a proper way becausegivingopenfeedback to employees on their jobperformance may encounter culturalsensitivities of losing face.Younger generation of em

26、ployees see learning and development opportunities as very crucial elements in choosing career.So oppor- tunities for advancement should be valued.l Organization resourcesCompetent salaries should be provided for talents since many Chinese workers are keen to move employers for higher pay. To make b

27、etter use of Chinese “face culture”,performance recognition,public recognition in particular,can be a great motivator.Whereas,public criticism should be avoided as much as possible.Fairnessand transparency should be highlighted in HRM practicesto cultivate a harmonious environment because Chinese pe

28、ople are very willing to talk to each other about their level of pay.l Extra benefitsSince Chinese workers are especially under heavy workload and emotional load,some health care program such as easy access to sport facilities and providing psychological consultancy services. ConclusionsTo sum up,the management strategies used at OPTITO UK may not adapt to the conditions of Chinese oil and gas industry due to significan