Alkaabi, Mohammed Surour Helal Surour
An Operational Excellence Model for
U.A.E Future Energy.
[Dissertation (University of Nottingham only)]
Most people have a cynical view on investments made on renewable energy by countries in the Middle East region and regard them as merely a public relations exercise as the Gulf States produce a large proportion of the world's oil and gas reserves (Ford, 2007). Hence,
there is a widespread belief that Arabian nations wish the global economy to continue to be dependent upon hydrocarbon fuels rather than cleaner form of energy. However, the setting up of the Masdar project in the United Arab Emirates (UAE) and growing interest in
alternative technologies indicates more substance than mere publicity stunts (Ford, 2007). Set up by the government of Abu Dhabi, the Masdar project aims to promote renewable technologies in the Gulf region. The project comprises a research institute, an industrial development zone, an alternative energy centre of excellence and Abu Dhabi Future Energy Company (ADFEC), a renewable energy development company. ADFEC has been set up to coordinate the various Masdar schemes (Ford, 2007). The operations management of ADFEC was the focus of this study.The overall aim of this research was to investigate and develop an operational excellence model for U.A.E. Future energy to convert from using oil as a major energy source to alternative energy sources as a way to diversify energy sources and increase the national income. The research question was addressed through a combination of secondary and primary research. Secondary research consisted of the acquisition of relevant information from various sources including academic books, journals, magazines, newspapers and relevant online sources. The primary research aspect of the study involved the design and distribution via email of structured questionnaires to operations managers at the Abu Dhabi Future Energy Company in order to find out how they are managing their departments, the strengths and weaknesses of the group and other relevant information. The questionnaire consisted of ten closed ended questions and the survey was emailed to fifteen managers at ADFEC. Ten out of the fifteen managers returned and completed the questionnaire. Overall, the primary and secondary sources in the study served to provide a clearer picture of how operations management was conducted at ADFEC.Conclusions were drawn from the findings of the primary and secondary research. These included firstly, that the United Arab Emirates (UAE) were making genuine efforts in setting up as well as promoting renewable energy sources within the Gulf region. Operations management encompasses all the main activities of an organization and therefore the Abu Dhabi Future Energy Company should focus on fully utilizing their operational activities in order to improve their financial performance. ADFEC must also deploy relevant operations management activities and develop human resources in their manufacturing segment so that they can enjoy the success experienced by Japanese companies in terms of the ability to develop higher quality products and gain competitive advantage. Furthermore, in the context of increased globalization and greater concerns for the environment, ADFEC should develop a sound safety management system, set up procedures for environmental auditing to successfully perform environmental management (Ortiz, 2001), adopt waste management to reduce waste, improve efficiency in the production process and improve quality. The company should also follow the example of the United States in enhancing its competitive position through transforming waste into useful products (Nersesian, 2000).Secondly, the study demonstrated that despite the comfortable hydrocarbon cushion the United Arab Emirates enjoys, the region is eager to switch to renewable sources of energy in order to protect the environment throughout the Middle East. The Masdar project in this case is supported by reputable research partners such as BP and GE in order to develop new energy solutions (Ford, 2007). Furthermore, the findings showed that the Abu Dhabi Future Energy Company uses its funds intelligently and is under able leadership and therefore on the verge of achieving technological breakthroughs. Assistance from industry partners ensure that the solutions created have practical applications and therefore broad market appeal. Nonetheless,in spite of the eagerness of the UAE to develop alternative sources of energy, certain barriers exist in the region including an expensive infrastructure and the existence of cheap electricity.In addition, the study indicated efforts are being made by the UAE to develop wind and solar power for producing electricity. In fact the region expects that 50% of its energy requirements to come from renewable sources (Williams, 2005). Since the study found that people are already using wind and solar power for their energy needs, this goal would appear to be achievable. Thirdly, the findings of the survey on operations managers at ADFEC revealed that they were convinced that converting from using oil as a major energy source to alternative sources of energy was an effective way to diversify energy sources and increase the national income. Although the vast majority of managers demonstrated awareness of both local and global trends in renewable energy sources, very few of them could explain in detail how the Abu Dhabi Future Energy Company could reshape their production activities into a more global orientation over the next ten years thus indicating a need for operations managers to take a more globally orientated approach to their strategies. Furthermore, a small percentage of managers still felt that the operations field should be better represented at senior management level. Other problems found by the survey included the failure of functional managers to meet each other regularly or get to hear about each other's problems, and the failure of U.A.E. Future Energy to include all stakeholders in all relevant phases and aspects of the strategy process. The results also indicated that not all managers interacted positively with their employees to get the best results out of them. Based on these conclusions, a series of recommendations were made. These included: the need for ADFEC to organize global promotional strategies in order to positions itself as an environmentally sensitive organization to overcome cynicism; a well planned recruitment campaign to attract the best talent to the operations department; a clear idea of how to globally orientate their production activities through studying the trends among other multinational competitors and new climate legislation; ensure that operations managers get co-operation from managers and employees from non-operations areas such as marketing and finance; place a representative from the operations group at senior management level who can articulate clearly suggestions and problems during the strategy development process; deploy job rotation in the company so that employees can gain an insight into problems faced by workers in each department and have respect for each others work; product managers to take time out to explain their function clearly and effectively to other employees to develop a common understanding of the language and process of manufacturing strategy; involvement of all stakeholders in all phases of the strategy process to foster consensus and commitment; a flexible management style to manage a diverse workforce and finally, an openness to new technology and frequent adoption of new technologies and innovations into their business models and operations so that ADFEC can keep pace with a dynamic and competitive environment, and maintain business continuity and increase organizational efficiency.
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