Winds of change

Challenges (1999)
Crippling systems of governmental

control over strategy

Low employee motivation due to
sense of entitlement rather than
performance based mentality
Overstaffing
Skewed production portfolio of
assets
Highly bureaucratic decision
making mechanism
Lagging on technology front

Intitiatives
New Vision : To ensure Indias
energy security by locating reserves
worldwide
Voluntary retirement plan to reduce
10% workforce
Revamp of decision-making
structure by eliminating bureaucratic
layers of staff approvals
Revamp of organizational structure
ensuring flatter structure
Performance oriented appraisal
mechanism
Maximise use of idle cash
IPO to infuse more capital for
expansion

International Foray
Reasons for internationalization
15% world population but only
0.5% of energy reserves

Role of ONGC Videsh

Ltd
Given greater power as Indias nodal
agency to negotiate energy related issues
Given flexibility to recruit quality talent
By 2006, $4 billion investment acquiring
25 properties in 18 countries
Able to develop relationship with global
industry leaders like Exxon Mobil,
Petronas and BP for various projects
worldwide

Challenges
Stiff competition from Chinese
national oil companies

Foreign Market entry strategy

Joint Venture route
Strategic alliance with Mittal
group to use their business
relationship built over time
Bilateral relationship agreement
with Chinese oil companies
(CNPC & Sinopec) for joint
bidding of global projects
Managed to win bids jointly with
Chinese companies in Syria and
Columbia

Current Status of production assets worldwide

International Strategy
Import oriented rather than Export oriented: Sourcing to meet
local country energy requirements
Shift from confrontational attitude to mutually beneficial
Strategic alliance