Oman Oil Companies’ Third-Party Logistics

Abstract

This paper aims at investigating transportation and logistics management in the oil industry. Two companies of the Sultanate of Oman, Oman Oil Company and Oman Shell Company, are chosen for the analysis. These companies demonstrate good results in the development of their transport and logistics services. Their experiences could be used to comprehend how customer services in the chosen field may be improved and why this improvement matters not for the companies only but the whole country. Organized activities and thoughtful decisions, capacity and efficiency, coordination, and 3PL activities are offered as solutions to the companies. The oil industry and the departments of transport and logistics undergo considerable change. Therefore, it is necessary to clarify the factors that influence the quality of work and the outcomes that could be achieved by different companies and develop the conclusions that could be used by people to improve customer services based on people’s expectations, knowledge, and demands.

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Introduction

Nowadays, people cannot neglect the fact that transportation plays an important role in their personal and business lives. Transportation has to be properly organized and structured in regards to the needs of consumers and the possibilities of executors. Therefore, in the modern business world, much attention is paid to the development of the field called transportation and logistics management. Transportation and logistics management aims at the promotion of different principles and policies that help to improve different means of transportation. It is the core of supply chain management because it guides people, controls the operations, and investigates the details of transportation processes to define the mistakes or shortages and improve the results in a short period (Christopher, 2016).

Organizations that want to stay competitive and achieve high ratings have to develop appropriate strategies and introduce effective ideas in their supply chain processes (Stadtler & Kilger, 2008). Each industry has its peculiarities, and transportation and logistics management have to be established regarding the industrial demands. The oil industry is characterized by several considerable profits during the last several decades. Investors from different countries want to be united just to gain the required profit and success. Therefore, it is expected to clarify what improvements in transportation and logistics management could be offered to promote efficiency in the industry. In this paper, the examples of the Oman Oil Company and the Oman Shell Company are chosen to investigate how the efficiency of customer services in logistics and transportation management may be changed.

The experiences of Oman Companies show that customer services in transportation and logistics management could be improved in a variety of ways, and companies have to consider the worth of each method including the streamlining of services, capacity management, coordinating logistics, and the promotion of 3PL to achieve optimal returns and clarify what ways are appropriate for them.

Literature Review

Oman Companies in the Transportation and Logistics Field

Oman is a well-known Arab country that continues taking impressive steps and establishing it as one of the major trans-shipment centers for traffics that exist between European, African, and Asian countries (Oxford Business Group, 2015). In 2015, the Sultanate of Oman celebrated its 45th anniversary and proved itself as a powerful and perspective country and a serious logistics hub in the whole region. Its geographical location and the possibility to be the only one situated outside the Gulf country creates the opportunities to improve its strategic positions, invest in infrastructure, and use the processes of industrialization and privatization to promote Omanization with time (Oxford Business Group, 2015). In the field of transport and logistics, the country has to upgrade its capacities at all-new ports and stabilize its positions at the existing ports, develop a GCC-wide rail network, and work on the airport expansion. These steps should help to improve the logistics sector considerably and attract new investors and start cooperating with foreign companies.

At the same time, logistics and transportation have to be improved in terms of customer services. The logistics industry of Oman has been transformed considerably (ASC Staff, 2016). The services have been improved due to strong governmental support and capacity enhancement. In 2015, this sector brought 4.9% of the GPD, and the country’s leaders believe that this number could be raised to 6.9% in the period between 2016 and 2020 (ASC Staff, 2016). The Port of Duqm remains to be the main strategic object of the country. Many local companies try to develop business relations with the representatives of the port and use it as the main means of transportation of items to different countries.

Oman Oil Company defines its opportunities to invest in the Port of Duqm Company and turn it into its vivid economic center. Oman Oil Company was founded in 1996 to invest in the energy sector of the country and develop the relations inside and outside the country (Oman Oil: About, 2016). With a short period, it became a good example of how the Sultanate could gain benefits from the services the company offered to society.

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Now, Oman Oil Company plays a proactive role in the country and combines its main goals (the promotion of energy and oil industry) with the programs focused on healthcare, sports activities, education, and the environment (Oman Oil: About, 2016). Another global group of energy in Oman is known as the Shell Oman Marketing Company. Today, it has more than 90,000 employees in approximately 70 countries of the world (Shell Oman: About us, 2016). The core values of the company include respect for people, honesty, and teamwork. All these factors help to create effective customer services and stabilize the field of transportation and logistics.

Transportation and Logistics Management Issues

The presence of the port in the country creates the necessity to involve several parties in the development of business relations. Besides, technology and social media should be taken into consideration. Transportation and logistics are the parts of a supply chain, and the supply chain is the part of the interactions companies and people have to develop. It is necessary to enrich such relations, and the technological and media approaches seem to be effective indeed (Terry, 2014).

Three-party logistics (3PL) is one of the possible methods companies use to distribute and fulfill their customer services and different. This approach makes the development of transparency in the relations between the company and its customers possible (Terry, 2014). Besides, the choice of outsourcing channels in the form of 3PL is based on the understanding of the drivers, operations, and associated costs (Rushton, Croucher, & Baker, 2014). Today, the companies do not indicate the number of participants in the services developed with the help of 3PL. However, certain attention is paid to such factors as the available logistical requirements, possible vendor choices, and expected costs. 3PL providers try to respect cultural and organizational choices and recognize the infrastructure of the companies-participants. Finally, such factors as IT capabilities and partnerships should be mentioned because they help to create a whole picture of all potential parties in the 3PL approach (Rushton et al., 2014).

Streamlining customer services is another approach that could be used to succeed in transportation and logistics management (Sehgal, 2011). This method helps companies to stay competitive, consider the current changes, and investigate the possibilities of certain people to meet the expectations of the company where they have to work. New ways of communication, the demonstration of the intentions to be as close to customers as possible, promotion of live chats 24/7 and self-services if people are interested in them, and the improvements of knowledge base could be offered as the main supportive ideas in the transportation and logistics field (Sehgal, 2011). Wood, Barone, Murphy, and Wardlow (2012) suggest paying more attention to the development of the policies with the help of which transportation capacities and logistics coordination may be improved. In general, the ideas to change customer services through 3PL and capacity management are proved as the best techniques used by Oman companies, as well as by the companies of other countries.

Streamlining Customer Service for Optimal Returns

Transportation is the process of moving goods, people, or other items from one place to another by air, water, road, or space. The way of how items are transported influences the way of how the business could be developed. Logistics is another kind of process that is chosen by many companies to follow the progress of all moving and handling activities that happen to items from the beginning of their production to the point when a consumer starts using them. Logistics in Oman companies have enough space for growth because of the constantly developing economies and the increased demand for logistics providers. People want their goods to be removed from one place to another because of different reasons. Therefore, streamlining customer services plays an important role because it promotes guarantees and supports customers. As soon as people learn that all services are organized in a certain way, they are eager to cooperate with such companies and learn their opportunities.

Optimal returns could be possible in case logistics and transportation services combine physical and non-physical activities. Physical fulfillment of demand includes different methods of transport and storage, and non-physical operations may be introduced in the form of supply chain design or negotiations about price or quality (Christopher, 2016). The relations between transport and logistics are so tight that some people cannot understand the difference. Still, it is necessary to comprehend that transport could affect the results of logistics services, and the quality of logistics services influence companies’ choices of transport. In other words, these two fields impose restrictions on each other in their ways and make people dependent on their choices. Streamlining is a chance to update customer services and underline the opportunities of customers and executors.

Efficiency and Capacity Management

Transportation and logistics management has to be regularly developed. Therefore, such terms as efficiency and capacity cannot be neglected because they influence the value of products, the quality of services, and the nature of outcomes. Consumers want to get as many benefits as possible from the services they buy. Oman companies under analysis demonstrate a unique approach to be used in the relations between companies, their customers, and investors. Companies may spend much money to add enough value to their products (Wood et al., 2012). They ask for governmental support and introduce the reasons why money is required. Therefore, it is expected that efficiency in transportation and logistics could be improved with time. At the same time, all companies try to save logistics costs. One of the possible methods is to increase the usage of possible transport capacity to its greatest extent. It is expected to integrate the logistics demand and consider the expectations of all departments to establish and learn how to achieve the purpose.

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Oman companies use flexibility as their chance to attract customers and save costs. For example, Oman Shell Company establishes its main business principles to promote a high performance of services and the attention to ethical behaviors and customers’ expectations. Logistics capacity may be enlarged in case companies start cooperating with their customers closely. It is not enough to support live chats and 24/7 phone call services. Customers should get access to self-services and the possibility to track their items from any part of the world.

Logistics Coordination to Enhance Customer Service

Coordination in logistics is another method that could be used to enhance customer services in the transport and logistics field. Coordination of customers is not the only type of relations that have to be developed during a working process. In Oman companies, many departments take responsibility for the completion of transport and logistics services. The coordination of managers has to be organized at one level, and the coordination of executive workers is usually developed by managers. Besides, it is hard for the company to check the quality of performance of each worker. Therefore, communication and coordination between the departments have to be promoted all the time to reduce the burden of managing and controlling (Sehgal, 2012).

Logistics service capacity aims at solving different uncertainties and demands established by consumers and service providers. Coordination of activities and problems has to be adjusted to the parameters of the companies and their goals. It is usually enough to hire one coordinator and provide them with enough information about the values and competencies of the company, the needs of customers, and the conditions under which transportation and logistics should be organized.

3PL for Companies in the Oil Industry

3PL activities are frequently used by different companies around the whole globe. For example, Chicago companies use 3PL as an opportunity to integrate their services with customer systems and improve transparency in their relations (Terry, 2014). Such integration turns out to be a good chance to learn customers, their traditions, and relations with different companies and cultures. 3PL used by Barrett Distribution Centers opened the possibility to develop high-level communication and competence among all members of the team and their potential customers. It was proved that horizontal systems were characterized by better supply chain management (Terry, 2014). Finally, it is possible to improve customer service with the help of 3PLs because effective customer support is offered regularly and customers could get the answers to their questions using online services and additional appropriate software companies.

Social media is the solution for many Oman companies because it, as a part of 3PLs, helps to recognize customers’ attitudes and investigate positive and negative experiences to eliminate the shortages and underline the strengths of their services. Social media is also a good chance to educate customers and make them understand the decisions made by companies’ representatives. The existing interactive environment is complicated for many people, and Oman companies try to facilitate the processes customers have to be engaged in when they ask for transportation and logistics services.

Conclusion

In general, transportation and logistics management is a crucial field that has to be characterized by numerous improvements and changes. It is not enough to establish effective customer services and make sure people get what they want with the companies. The examples of Oman Oil Company and Oman Shell Company show that logistics customer services can be improved only in case several approaches are used. 3PLs and coordination help to identify the main issues of the process and clarify what steps could be taken in a certain environment. However, logistics and transportation management also aims at discussing the opportunities for the companies and the steps that help to save organizational costs and promote a good reputation. Transportation and logistics have to be thoroughly integrated because they aim at supporting each other and helping customers get the best services.

References

ASC Staff. (2016). Analysis: Oman logistics industry’s transformation. Web.

Christopher, M. (2016). Logistics & supply chain management. Harlow, UK: Pearson.

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Oman Oil: About. (2016). Web.

Oxford Business Group. (2015). The report: Oman 2015. Web.

Rushton, A., Croucher, P., & Baker, P. (2014). The handbook of logistics and distribution management: Understanding the supply chain. Philadelphia, PA: Kogan Page Publishers.

Sehgal, V. (2011). Supply chain as strategic asset: The key to reaching business goals. Hoboken, NJ: Wiley.

Shell Oman: About us. (2016). Web.

Stadtler, H., & Kilger, C. (2008). Supply chain management and advanced planning: Concepts, models, software, and case studies. Berlin, Germany: Springer.

Terry, L. (2014). Customer service: It’s the thought that counts. Inbound Logistics. Web.

Wood, D.F., Barone, A., Murphy, P., & Wardlow, D. (2012). International logistics. Florence, KY: Springer Science & Business Media.

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