case Second opinion strategic plan offshore shipyard - jbr-consultancy.com

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Second opinion strategic plan offshore shipyard

Mission

Second opinion on the strategic plan of the management of an offshore shipyard.

Background

Our client is active in building large offshore installations in the oil and gas industry. Exploration and exploitation of oil and gas fields is the main driver for its business model. The position of large oil companies in the North Sea is under pressure and therefore there is fierce competition with suppliers from low-wage countries. The design of an installation and the timeliness of construction ultimately determine the profit for the end customer. Our client specializes in making relatively large and complex installations, while the trend in the North Sea is towards smaller, more flexible installations.

Problem statement

The client is wondering if and how it should remain active in the gas and oil industry in the North Sea. How it can offer its large installations competitively in the rest of the world and whether this will force it to relocate its production. The management is uncertain about the developments and does not have a well-founded answer to the above dilemma. JBR is asked to validate the management's existing plan and, if necessary, to propose alternative strategies.

Our contribution

The existing plan of the Management Board is assessed and with that relative certainties and risks are made clear to the Supervisory Board. Based on the Supervisory Board's decision, JBR will work on a new plan resulting in a partnership with an American engineering firm so that more control can be gained over the distinctive capacity at the design stage of large installations. In addition, it is advised to open foreign shipyards where local content can be delivered by acquiring projects. In the North Sea, a different strategy of standardized and modular construction is advised. This leads to smaller, more flexible and cheaper units.

The result

A strategic plan that distinguished between large projects for which distinctiveness was enhanced and risk became more manageable and smaller flexible standardized units. With regard to implementation, we provided concrete handles.