Shell Case Study - 838 Words

The Case Study on â€Å"Organizational change at Royal Dutch/Shell† This case study on â€Å"Organizational Change at Royal Dutch/Shell† deals with the organizational change that the world’s largest non-state-owned oil company made to respond its operating environmental changes in 1990s (Hill, C 2005, pp. 476-477) While there are a few different structures of global organizations such as worldwide area structure, worldwide product divisional structure and global matrix structure, the Anglo-Dutch company Royal Dutch/Shell (hereinafter Shell) decided to be structured with a matrix structure from the 1950s until 1994. Under the matrix structure, the head of each operating company reported to two bosses; one boss was responsible for the†¦show more content†¦While the oil price plummeted in the winter of 1986 when the price fell from $31 per barrel to $10, Shell managed its budget by half: the company had to work much harder to develop new projects more cheaply. As a result, Shell could make huge improvements in drilling techniques such as slim-hole drilling and directional drilling. The use of 3D seismic became widespread. (from Shell’s official homepage; 1980s to the new millennium). All of these activities worked well under the matrix structure of Shell until the end of 1980s. There was a huge environmental change in 1990. It’s the Gulf War. The Iraqi invasion of Kuwait, partly prompted by the low price of oil, led to uncertainty about production and prices spiked. Iraq wanted to gain control of the worlds third largest oil producer to give it more control over the world market. Following the Gulf war to liberate Kuwait, crude oil prices entered a period of steady decline, reaching their lowest level in 1994 for 21 years (BBC, Why the oil price keeps rising, June 2008). As the oil prices declined, naturally there was pressure on Shell’s profit margins. Although it had traditionally been among the most profitable oil companies in the world, its relative performance began to slip in the early 1990s as its competitors adapted rapidly to the environment changes. As a result, this suggested that the Shell senior management team review its strategy and the fit between strategy andShow MoreRelatedCase Study : A Nut- Shell Essay1113 Words   |  5 Pagesnut- shell, this case study tell us about a big project which faced so many problems within one year of project execution. The completion of this project was 3 years with a large budget of $50M. But due to problems the CHEMICS insurance company decided to update all their processes and systems. This project effect all the departments within the company.So a management team with hired consultants and some members of insurance company was formed.Moreover there was no project manager for this case studyRead MoreCase Study : Royal Dutch Shell1003 Words   |  5 PagesOxfam Intermon. 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