Multiobjective Approach in Developing Oil Production Enterprise’s Production Strategy

Abstract

The paper is concerned with issues of methodological support of selection of preferred option of production strategy. Russian oil production enterprises are the study object. The paper provides characteristics of current business environment, main features of running oil and gas organizations are stated, the need for timely flexible strategic decision making in the area of production management given the specific features of industry companies is proved. Moreover, the problem of the lack of available theoretical and methodological instruments of management decision making, the need for their adaptation to operational environment of stated business entities is revealed. It’s stated that complex changing conditions predetermine special requirements for these instruments. Particularly, methodological approaches are needed that allow making decisions according to various criteria. Given this, criteria may confront each other. The technology of multiobjective optimization is chosen as a basis for further modification. The paper attempts to integrate strategic and production management, and also management decision making theory by means of considering local (partial) performance indicators of production organization target strategic parameters of production strategy. Subsequently suggested indicators will be used as measuring means when choosing the preferred variant of decision based on multiobjective optimization methods. Recommendations concerning objective function generation, analysis and adjustment of partial criteria for adding into estimation model. It’s proved that target and secondary business processes should be considered interrelated and interdependent for the purpose of production strategy elaboration due to specific nature of oil producing companies’ core operations organization. Therefore, estimation models are developed correspondingly. In conclusion author’s research guidelines are stated.

DOI: 10.5901/mjss.2015.v6n3s3p193