ADNOC is the UAE’s leading company in the field of petroleum, crude oil, natural gas, and lubricants. It was founded in 1971, and ever since grew to be a major player both in the local and regional markets. Its headquarters are found in Abu Dhabi. According to the financial reports presented by the organization in 2011, its yearly revenue is circa 75 billion dollars.
ADNOC is a government-owned company, and as such, it has control over most of the country’s oil and gas preserves, which gives her a distinctive edge against its competitors. As of 2010, it produces over 2.9 million barrels of oil a day. It is considered one of the largest oil and petroleum companies in the world. The number of employees in service of the organization is around 23,000 individuals. It has two oil refineries in its possession, and its oil reserves are concentrated around the regions of Ruwais and Umm Al Nar. The company also produces and exports liquefied gas. While the company has many trading partners around the world, the majority of its earnings come from contracts with the United States of America.
The Method of TQM implementation in ADNOC
In order to manage such a large organization with plenty of responsibilities, missions and tasks to accomplish, ADNOC implements the Total Quality management system. Their operational model follows the classic TQM wheel, which involves three different approaches to management, such as the guru approach, the quality award approach, and the Ala Carte approach. These methods are interchangeable, and it is possible to incorporate elements of one method into another in order to provide quality management.
The implementation of the TQM model proved to be very effective for ADNOC. Ever since it has been implemented in the company, the number of customer complaints steadily went down. This indicates the overall increase in performance and quality of services provided to the customers, which in turn resulted in fewer complaints. The company is now more focused on its mission and objectives, and the improved customer service means greater revenue generation and better reputation among its clients.
Three Branches of the TQM tree
The TQM model is split into three parts, which, while different, form the branches of the same tree. These segments are:
- Vertical Alignment.
- Horizontal Integration.
- Unit optimization.
The Vertical alignment is identified by the Hoshin planning system, which is concerned with three questions: who, what and how. Its purpose is in organization and formulation of plans and processes necessary for completion of yearly goals and objectives. The Hoshin planning greatly contributes to the effectiveness of ADNOC’s management efforts. The horizontal integration is similar to vertical alignment in terms of goals and questions asked. The only difference it is used on the same level, between teams and departments, rather than from top to bottom.
Total Quality Management is a modern and effective strategy aimed at increasing the quality of services and products in any given organization. ADNOC could serve as an example of its efficiency, as ever since the introduction of this management strategy, the company experienced a steady growth and a massive decrease in customer complaints. This allows the company to retain its strong positions in the oil market. However, its competitors are adopting similar strategies as well. In order to stay on top, ADNOC would have to implement the TQM model on a wider scale, in order to improve its effectiveness and client satisfaction.