Post services corporation environments effect on the company Essay

Port Services Corporation ( SAOG ) is registered as a public articulation stock Company in the Sultanate of Oman established vide Royal Decree ’46/76 ‘ issued on 17 November 1976 and registered at the Commercial Register of the Ministry of Commerce and Industry under Commercial Registration No.1/07167/0. The Company undertakes the direction and operation of Port Sultan Qaboos under a grant understanding entered into with the Government of the Sultanate of Oman on 17 November 1976 for a period of 30 old ages which expired on 16 November 2006. The Agreement had been extended with the same conditions until 31 December 2006. The bill of exchange understanding between the Government and the Company allowing the grant to pull off and run the Port for a farther period of 6 old ages effectual from 1 January 2007 stoping on 31 December 2012 has already been finalized and the same shall be signed by the Government and the Company in due class. The bill of exchange understanding provides for the computation of franchise fee on the same expression as in the old understanding.

Port Services is an Oman based company that operates and manages Port Sultan Qaboos This port is located in strategic geographic location in the North of Oman at Oman Sea and the entryway to the Arabian Gulf and it is designed and equipped with the highest and latest engineering. The company services include container terminal services, break bulk services, sail services and anchorage services. It provides port installations such as substructure, berthing, Cranes, backup pace and existent estate installations.

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The company chiefly operates in Oman, where it is headquartered in Muscat and employs about 684 people. The company recorded grosss of OMR25.8 million ( about $ 67.

2 million ) in the financial twelvemonth ended December 2008. Its net net income was OMR7.7 million ( about $ 20.1 million ) in financial 2008.

PSC Aims

Port services corporation has made really clear aim for the concern operations and those aims are:Committedness to the development of Oman socially, and concern the environment by following pollution control.Keep a safe topographic point of work with a high criterions and provided with an animating working atmosphere to the employees.Provide efficient and dependable service with their spouses in concern.

Achieve a significant net income growing to the company and stockholders.

PSC Strategic Plan

Containers port has grown significantly in the recent old ages around the Earth and in this country specifically due to the developments demands of the states in this country. There has been even important growing in the investing in the terminus installations in the part to manage the growing. The transportation lines besides converted the consecutive port calls to transhipment flows because of the geographic expedition of the immense vass on the major trade lanes. To back up demand increasing the port services corporation has right equipment, expertness and substructure. The current strategic program of the Port Services Corporation is to increase the port capacity, expand common lading terminus and increase the operational capacity by development of working squads and construction of installations and equipments to the highest criterions.

The Success Factors

The critical success factors of the Port Services Corporation.

The staff corporations and battle.Retention of the bing clients and pull new clients.Development of new clients to make full the capacity.Optimum use of the cost and efficiency of the services provided.

External and Internal Environment analysis

“ The cardinal drivers of alteration are environmental factors that are likely to hold a high impact on the success or failure of scheme ” ( Whittington, Johnson and Scholes, 2008 ) .To measure the port services corporation current scheme, we should cognize how to Analyse external and internal environment to make to some certain nonsubjective to be used as mission statement to heighten the productiveness.

External Environment

Many factors responsible of the alteration in scheme taken by stakeholders. One of those is the external environment and this factor influences on the determination taken by stakeholder.

PESTEL Analysis

To understand the influence of macro environment accommodating PESTAL analysis is a utile method.


Oman is blessed state under the leading of His Majesty Sultan Qaboos which has a stable and balanced authorities under his leading.Oman has a authorities which encourages aliens investors every bit good as local to come in front and put in this state.Oman expected political stableness to go on because of the wise vision of His Majesty with respect to covering with neighbouring states and the international.


As most of the states in the in-between east Oman ‘s economic system is besides mostly based on crude oil and gases. By twelvemonth 2009 the authorities generated contributed gross to approx 74 % to 88 % .

Even though have no jumped back to the old old ages degrees still it is above the budgeted degrees which has given the authorities batch of comfort in go oning with the development programsAs a vision the state wants to cut down it ‘s over dependence on oil and gas so the authorities wants to give batch of focal point on the development of the industrial sectors.The authorities has initiated batch of new undertakings with regard to enlargement of substructure and roads to develop the economic growing of the state.As most of the companies the international trade was really severely affected by the fiscal crisis that had begun in the last one-fourth of the Year 2008 which resulted in terrible recognition crunch in the market.

The economic system of Oman has benefited because of the ground that the universe oil monetary values has been higher than the monetary value budgeted by Oman authorities.The higher oil monetary value has provided the Oman Government with the purchase to go on their investing into the substructure undertakings.Oman ‘s popularity has besides grown as a tourer finishOman authorities has besides given batch of emphasis on e-government and this has been a great success after the launch of the new national system of electronic web.It is seen that Oman is the lest affected in the Middle E during the fiscal crisis that has hit the universe and it is rated 16th in ranking of the lest affected globally.

( retrieve from: Oman day-to-day intelligence paper, dated 23rd March 09 ) .


Omanisation has been on precedence in all the policies initiated in the state The Corporation direction attaches due importance to pulling, developing and retaining specialised human resources which is capable of covering with the sophisticated handling equipment and the advanced cybernation system with a position to supply good criterion of services to its clients.Government has encouraged the formations of Unions for the employees lawfully.Due to the above set policies it is seen that maximal work force in the state is immature.The authorities besides had a societal security categorization that provides pensions, survivorship and disablement and to Omani employee.In October 2006 Oman has besides agreed on the verification of the FTA ( Free Trade Agreement ) with the United States of America.Oman is giving batch of accent on denationalization and this had attracted batch of investors into the state making batch of new avenues for the young persons of the state.


There has been immense enlargement of transit engineering, puting in airdromes and ports buts Oman a major transhipment hub due to its strategic location on the universe map.

Many of the biggest telecommunication companies have ventured into Oman which has provided better and latest concern communicating with the universe.The long-run program of ‘Oman inducement Vision 2020 ‘ development has laid accent on the demand for the Oman ‘s economic system to distribute through the procedure of industrialization, denationalization and Omanisation ( all Omani ) .


In Oman the bulk of industrial estate countries are placed near to the seashore for the ground of easy transit of goods. There is ever a danger of dwelling the coral militias of the sea and the authorities has taken up most attention to safeguard the coral militias of the state.The authorities is besides advancing the free zone country next to the port along with a bundle of inducements and they are in treatments with the governments of Jebel Ali Free Zone in Dubai for the partnership.


Oman authorities has been advancing the private investing and is really friendly in footings of the Torahs. The Torahs enforced are really friendly with fewer limitations to promote the foreign investors so that they do non confront any jobs to come to Oman and invest. Oman authorities does n’t hold a sort of written construction or anti-discrimination Torahs.By and large the visas can be obtain, but there are some classs which may necessitate planning for non-Gulf states ( GCC ) citizens.

Industry market features ( Key Drivers )

Despite the planetary economic downswing the industries in Oman has shown growing in the Year 2009 and is expected to demo farther growing in the Year 2010. It is expected that more transhipments volumes will be routed through Port Services Corporation which will increase volumes of the port ensuing in growing. Further to that in the last GCC summit a proposal was put frontward for a railroad undertaking through the GCC states and one time this is initiated we will see a big decrease of volumes shipped to the upper gulf which makes the location of Port Services Corporation in Oman really of import.


There are some fortunes that may impact the port concern in Oman which is listed as followed:The building has shown declined in the new industries in Oman.

The downswing of the planetary economic system continues through this twelvemonth.Companies organize long term loan installationsThe loaning of bank loans with high involvement ratesThe authorities increases its disbursement on industrial and undertakings related to tourism to farther income variegation

Analysis of Rivals

Analyzing the rivals within the same concern industry will convey the concern frontward to present were chances may increase to convey new clients to the company. “ Understanding of the competitory environment is a critical ingredient of a successful scheme ” . ( M.Grrant, 2008 ) .

To good understand your clients, you need to listen to their demand and outlook to accomplish your scheme.The authorities of Oman has let go of a new undertaking to put up a port in Duqm which is a really lightly populated country along the seashore of Arabian Sea and the Indian Ocean that make this country a really strategic topographic point for constructing industrial country and pull new investors. There is besides a undertaking puting up a port in Sohar which is a joint venture between Port of Rotterdam and Sultanate of Oman. Sohar and Salalah free trade zones are another add value for export industries. The new industrial port and the development of the gas-based industries in Sohar will assist use Sohar ‘s demographic profile and Port metropolis of Sohar is the individual largest industrial investing.

Analysis of strategic portfolio

Port Services Corporation emerged as the major transhipment hub of the universe in the Year 2008 – 2009.

The development of the port substructure has been completed and the superstructure will be completed in the Year 2010. PSC expected to increase its market portion and vie other companies in the country with the same concern.STRATEGICHigh POTENTIALStakeholder influences is to set the company every bit positioned to take full potency market portion and to turn further in the coming old ages with the addition of chances and rivals.

Close contact with the governments concerned for utile undertaking development and follow the new engineering and invention for developing the company services.KEY OPERATIONALSupportTo make financess and to reassign the port a safe topographic point to work. Emphasis on preparation & A ; procurance of new good advanced tools for the following new coevals ships.Most of clients like Mediterranean transporting company, Maersk Line and American President line causal full throughput of the container terminus


Port Services Corporation has a opportunity to reinvest the inducement of the trading of large development undertakings of the country to aim the market and can get down alone policies for some of the services.As the Port Services Corporation has large support from the authorities with respect to the distant vision program can hold programs for good programs for enlargement and investing.As there are many new upcoming undertakings they have an chance to acquire into long term contracts to transport and provide the equipment and stuffs required by these new international companies who are coming to Oman.As they have the ability to manage the theodolite there is an chance to hold theodolite services for all the ship go throughing through the part.

The model of five forces

For better apprehension of competitory that affect the nature of an organisation or industry is implementing this model. The consequence of this analysis shows the menaces that PSC is confronting.Menace of entry: menace is low because PSC in market from 1976, that clip it was the lone company operating in the state and has developed since that clip besides this port is the chief port in the state and it is supported by the authorities and construct a high repute with its chief clients.Menace of replacements: this can impact demand for services and do clients choice others picks or rivals due to installations, cost or any other offers. The menace of replacements is high because the figure of ports increased in the country.

The bing ports in the South of Oman ( Salalah Port ) and the programs to put up a new port in the east seashore of Oman ( Al Duqum Port ) will besides impact the concern of the Port Services Corporation.Power of providers: comparing market portion the power of providers is highe. If we see broad scope of clients are seeking this sort of installations. PSC has taken the enterprise to hive away containers in block/stack for big volume importers for easy and fast bringing at no extra cost. Some companies like SAUD BAHWAN GROUP and PASFR ( Public Authority for shops and nutrient militias ) have opted for this installation.Power of purchasers: because there are figure of picks the purchasers power is higher and it is hard to convert the clients by rivals with the same merchandise or services in the same castle which besides completion become high. PSC has taken the enterprises to form bringings at dark clip for importers without bear downing overtime. Few companies have come frontward to avail this installation besides encourages consignees to take direct bringing of lading utilizing their ain labor and truck and offers 25 % discount on shore handling charges on general lading.

Extent of competition: The Government of Oman has been building new ports and still there is deficiency of lucidity of the function of each port and hence we can non quantify the impact due to competition..

Analysis the findings of external environment

With the steep rise in the oil monetary values the local economic systems got a immense encouragement taking to immense investings in the substructure undertakings. This has besides led to an addition in the imports in most of the states in the Middle E taking to an addition of approx: 12 % in the container cargos into the part. This has triggered batch on investings in the developments of ports to manage this sort of addition in the concern. The twelvemonth 2008 saw the transportation lines fighting with non merely the addition in fuel monetary values but besides with the cargo rates which went up by 15 % .

One another job seen was the addition of plagiarists in the Gulf of Aden which forced the Navy to increase their patrolling in the part and some clients tried to avoid this path because of this hazard, on other side insurance monetary values for cargos to the country went up and that is affect the company ‘s cost. The chief troubles largely political due to the non stability in the country.By the last one-fourth of twelvemonth 2008 the fiscal crisis appeared and came the hard currency crunch. This affected the planetary trade really severely and the Port service ‘s is still resettling the recognition crunch faced during that period.

As the universe is easy acquiring out of the fiscal crisis so is the Port Service ‘s Corporation coming out of the unpredictable period of the planetary economic system. The direction will be closely supervising the consequence of the economic lag and will originate counter steps to get the better of the state of affairs.

Internal Environment


Port service ‘s corporation is located at a really strategic place in the Middle East. It is located at one of the busiest sea path ( East West path ) for oil & A ; goods trading in the Arabian Gulf, India & A ; China.The squad of Port Service ‘s corporation is competent and motivated to keep the top place among the international companies like Meresk & A ; Sealand.The ability of the port to travel in front with any immense enlargement of the port in future without any jobs.


There is a deficiency of the international repute so need to better globally the consciousness foregrounding the market.

Findingss of internal environment analysis

After making the analysis of the Port Services Corporation we reach a decision that the company has a really competent squad holding an expertness to manage the sea lading concern professionally.

In the recession period the company needs to command the costs and make high demand to counterbalance the loss that might crawl up during this period. The analysis of the chances has highlighted the hereafter upcoming undertakings which can take to new concern contracts. The company demand to add up some new partnership contracts with some of the large international companies which may convey up the repute of the company globally.

The organisation Drivers of alteration

As an administration there could be many drivers which could act upon and take to some organizational alterations as such services are closely linked to the local and planetary economic state of affairss. So any crisis in the local or planetary economic system could trip an organizational alteration. Other than the local and planetary economic crisis even the authorities, market, cost & A ; capital related issues besides could drive the alteration is organizational constructions. The major driver act uponing the Port Services Corporation ‘s strategic programs now is the recession and it could impact the consequences of the company. This could even impact the long term vision of the company every bit good.

The company may be forced to be after variegation reacting to the market state of affairss as the company is in enlargement phase and investings involved are immense.

Proposed Scheme

There could be many strategic programs put in topographic point by the Port Services Corporation to take on the increasing market potency. The company might utilize the right scheme with respect to the doctrine of the company which could be based on the corporate schemes for a long term benefits of the company.The proposed scheme could be implemented in two stages. The first stage could be by utilizing the Organic development scheme and the second could be by holding strategic confederation.Organic developmentAs we have mentioned earlier Port Services Corporation has programs to better the basic nucleus capablenesss and better the accomplishments of the employees to keep its current services to the client and besides to be prepared to manage the new engineerings that would be installed in the hereafter. For this to go a world the company needs to give primary accent to the preparation of the work force and latest advanced engineering demands to be installed instantly.

As a policy the company need to give accent to engaging the local skilled work force as they are cheaper than acquiring the skilled work force from the states. Hiring the local work force will non merely cut down the cost but besides be in line with the company ‘s mission. Looking in front at the new planetary challenge that could originate due to the deficiency of manpower the company needs to concentrate in this country besides. The company demand to utilize the critical success factors as illustrations and need to be after a new long term vision to get the better of these new challenges.

Strategic confederationsAs portion of the globalization and cost decreases the Port Services Corporation could believe of acquiring into confederation with other ports operated in the country to portion some resources which common to both, sharing some work force which could convey down the cost or even sharing some activities which may be common to both. Such confederation could beef up both the companies in footings of accomplishments and developing schemes which could assist both to confront the challenges of the new market. The company could hold a strategic confederation as a taking spouse in the market.The cardinal factors for a successful confederation with other ports Companies are:Clear strategic intent.Alliance benefits and outlooks.Relationship direction.

Evaluation of Proposed Scheme

The proposed schemes can be rated utilizing three factors:Suitability.Acceptability.



In the first subdivision of the proposed schemes it is suggested to do alterations in the nucleus policies so as it is an luxuriant procedure it will take clip. Hence it is the most of import thing to run with. The 2nd scheme proposed suits as it suggests maintaining concentrate on the market leader and to larn from their experiences and so implement the good patterns. Such a move will assist to develop a planned market onslaught and will assist in understanding the market better.


Once the proposed scheme is implemented the returns are traveling to be really good by anticipating payback period and high ROCHE finally ensuing in a good profitableness but we need to hold a fiscal projection which should be safe and without much hazard because we have an first-class geartrain and liquidness at Port Services Corporation. Added to this we might necessitate to hold a sensitiveness analysis to understand the nature of hard currency flow in the following 5 old ages and besides the factors which could act upon the hard currency flow of the company which may finally impact the company ‘s overall public presentations.

Under any fortunes the Port Services Corporation has programs which shows them heading to an divine hereafter and besides the geographical factors are really actuating.


The execution of the suggested schemes will back up in increasing the hard currency flow into the company which will in bend aid in be aftering a good prognosis and eventually acquiring a good feasibleness for the company. The company has a high possible competencies and may choose to back up employee accomplishments and manpower competency.


The authorities of the Sultanate of Oman is determined with respect to the programs of developing new ports around the parts of Oman. In malice of the planetary fiscal crisis the authorities has non withdrawn or slowed down with the programs of building of the commercial port at Duqm which will be given dry moorage and basic cargo services. Port Services Corporation besides has programs of enlargement once its completed, will develop its capacity to 3.48 million twenty-foot tantamount units ( TEUs ) , up from the port ‘s current capacity of 1.9 million ( TEUs ) .

As mentioned above Port Services Corporation is to continue with programs to set growing on the acceleration way with an purpose of acquiring a new client like China Shipping, American President Line and Mediterranean transportation company. Along with this they besides plan to travel in front with the outgo of development which will assist them in foretelling difference and capacity crunch. Apart from these the company will besides look into cut downing the operational cost and at the same clip addition efficiency. the In extra, the company may go on to maximise efficiency and minimise operational cost. The besides know that even though it is recession clip it is besides the best clip to travel in front with the enlargement programs and puting on the new equipments because when the market comes back to normalcy Port Services Corporation will be ready to take on the new challenges of the market.

The will besides be in front of the competition in footings of the substructure and equipmentsBoth proposed strategic can be selected in stages by utilizing organic development or strategic confederations. The two proposed schemes are suited for Port Services Corporation to settle in every bit analysed in the appraisal of the proposed scheme subdivision.


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