Core Competencies Identification and Development: Evidence from Oil and Gas Exploration Company

Abstract

Abstract Background Key trends say that to stay as a primary energy source for the upcoming years Oil & Gas companies shall concentrate their efforts on efficiency and technologies, including digital. The situation in the Exploration sector is challenging, as there are almost no "easy" resources left to explore. One of the ways to build a further development strategy for the Oil & Gas Exploration Companies is to define and build development plans for their core internal capabilities. To boost their efficiency, companies shall concentrate their attention and efforts around their core competencies. Purpose The principal aim of this paper is to suggest the method of identifying the internal sources of competitive advantage (the core competencies of an organization) and building the plans of their development on the example of the selected Oil & Gas Exploration Company. Methodology A case study was carried out utilizing the methods synthesized by the author basing on the critical analysis of the previous conceptual and research studies, including strategic architecture, value chain analysis, POCCI model and both quantitative and qualitative methods. The identification of core competencies was based on a discussion nature of focus group activities organized in the form of strategic sessions among the top management level of the selected Company. Findings Five core competencies were identified for any Oil & Gas Exploration Company: managing personnel motivation and development, managing uncertainties, regional / basin analysis, building an integrated business-case, and geological modelling. These results were validated and proved by a crosscheck analysis, final discussions with the focus group and a round table discussion among industry experts, consultants and top managers of major oil companies. Discussions and recommendations for further development The validity of methods suggested by the author is proved, however, some points of further methodology were identified during the research. The clear understanding of internal capabilities, the core competencies development level and what is the company is capable of today and tends to be capable of in the future will become one of the most valuable parts in every strategic decision-support package. The clear picture of identified and estimated competences together with an on-going benchmarking becomes a valuable guide in systematization and managing the company's development.