Subcontracting strategy for future SBM offshore projects and its implemetntation - Dissertation Example

The purpose of this research is to analyze the subcontracting strategies that are suitable for SBM Offshore to employ in their Engineering, procurement and construction (EPC) activities.  The document will also cover current adapted strategies, further improvisation in engineering, topsides or complete vessel subcontracting scope of work, new possible strategies and possible suggestions on improving supply chain control. The author seeks to investigate items such as what engineering activity or combination of activities should be subcontracted, whether to utilize local or international subcontractors, the risks involved and how to mitigate them, preferred business approach in selecting subcontractors and success rates of the options available.

This paper is organised in the following manner: it starts with the introduction chapter which provides the context and rationale for the research topic. The Second Chapter presents the relevant theories and models that were used to verify the choice of approach selected. The next chapter describes the approach chosen and the rationale behind that choice, the emergent issues and limitations. After, an outline of the research design and method is given. The data and results are presented in a logical manner.

The fourth chapter discusses the result findings and critically reviews possible courses of action from a variety of viable options with regard to selecting a subcontracting strategy for future projects of SBM Offshore and how to implement them. It also provides managerial implications and recommendations for consideration. The paper concludes with a Summary and Conclusions section that condenses what the research covered.  In this chapter, the researcher presents the following sub-sections: background of the study, problem statement, and purpose of the study, project deliverables, research questions, research objectives and rationale of the study.

SBM Offshore is a major player in the upstream oil & gas sector and one of the leading players in global engineering and construction solutions. SBM Offshore pioneered the FPSO (floating production storage and offloading) segment globally (SBM Offshore, n.d.) and is always on the lookout for the introduction of newer technologies and other management styles in order to steer ahead of competition. In view of this, the company introduced the concept of subcontracting in its engineering and FPSO activities.

To this effect, the company found varying success on the occasions when it resorted to subcontracting its projects in the areas of FPSO activities. In light of this fact, this research project intended to ensure that the company’s moves into the process of subcontracting would eventually prove to be profitable. The research project examined the ways in which SBM Offshore can develop their subcontracting strategies in order to improve their results in topsides and FPSO units to enhance their productivity and business performance.

Alongside, it investigated what the advantages and disadvantages of subcontracting are, with special reference to FPSO projects.