Ibrahim Alalawi – Deputy CEO, AlMansoori, Abu Dhabi
Deputy CEO of AlMansoori, Ibrahim Alalawi, discusses the company’s greatest asset, its ability to maneuver around current market conditions and how it remains one of the MENA region’s most trusted companies due to its technical quality, competence and professionalism.
Over the last couple of years, AlMansoori has developed into a very important regional player, winning over USD 100 million in projects across the UAE, Saudi Arabia and India. To what do you owe this remarkable success?
The biggest factor in our recent success is without doubt our people. Without them, we simply wouldn’t have been able to progress in such a forthright manner. AlMansoori possesses a well trained and highly dedicated human capital base composed of committed individuals who share our vision of providing the best possible service to our customers.
What perhaps differentiates us the most from the competition is our highly customer-centric corporate ethos in which the focus is very much on responding to client expectations rather than merely meeting contractual obligations. We can only carry this off, however, by investing deeply in our workforce and forging the right sort of corporate culture.
As our employees progress through the company they undergo various professional development programs including four categories of customer care training. This means that, by the time a member of staff reaches management-level, they are already very well versed in customer care. Senior ranking personnel are also expected to lead by example so that best business practice cascade down the hierarchy. The end result is that, when AlMansoori interacts with its customers, it is always able to walk the talk.
You have been in your current position for over 5 years and in some capacity at AlMansoori since as far back as 2004. During that time the industry has witnessed some tremendous fluctuations. What are some of the key market forces affecting AlMansoori’s UAE operations at the moment?
Our greatest challenge, right now, is coping with the growth in demand for our services while simultaneously reducing our cost structures because our customers are putting a lot of pressure on us to reduce our prices. It takes a certain amount of creativity and innovation to be able to still deliver the same quality service at a scale, but at a lower price. We have to reorganize our business processes and start thinking outside the box so as to be able to achieve more with less.
How are you going about mitigating that challenge?
It’s very much about optimizing the way we do things such as sharing services across business units and thinking twice before making large purchases unless they will demonstrably enhance the quality of the service. We notice that some of our competitors have been laying off staff and scaling back on their technological acquisition, but we don’t view those sort of kneejerk strategies as sustainable over the long run. We will avoid going down the route of compromising the quality however because that is the very factor that makes our paydays possible at the end of the day.
It’s common to encounter companies lowering the quality of their offering and cutting corners when faced with the sort of belt tightening currently afflicting the market, but by doing so they risk ending up falling short of delivering the service that the end customer demands. That can be highly damaging for their brands, their reputation and the hard-won trust that has been established with the customer. The end result is a race to the bottom in terms of quality standards that erodes the client base and jeopardizes the long-term viability of the business. We, by contrast, are always mindful of the longevity of our offering and the impact of our actions over time.
Does the oil price decline offer any opportunities for a company like yours?
Absolutely. The fact that our customers are now fixated on cost control to some degree places us at an advantage because we don’t possess the big overheads or stock market pressures that afflict many of our competitors. Those publically listed in London or New York are under intense pressure to deliver quarterly results whereas a private company like us enjoys the luxury of being able to focus on longer term gains. Experiencing losses in one quarter is not a drama if we can be assured of recovering them in the following one and this flexibility of maneuver means we can concentrate firmly on providing quality services to the client without having to be constantly answering to our investors.
The turbulent oil market situation has even provided some unexpected opportunities for cooperating with our competitors to the extent that nowadays we sometimes discuss how we can both align to provide services at a lower cost. Because we are already a low-cost service company, there are actually certain occasions in which they find it would be in their interest to hand us a portion of the work that they would be unable to carry out cost efficiently so ultimately end up sub-contracting out to us. Before the oil price crash this sort of thing would have been unthinkable. Previously it was a very different ball game in which each actor strove to grab as much market share as possible.
With ADNOC planning to increase production to 3.5 million barrels per day by 2018, what opportunities do you see for AlMansoori in the UAE and Abu Dhabi, specifically? How are you ensuring that you play a role in responding to the targets set forth by ADNOC and its subsidiaries?
Because we’re from here, so already firmly established and entrenched, our future development consists really in expanding upon our existing scope of work. Alongside our strong growth track record in the UAE, we have also identified new opportunities in neighboring countries such as Saudi Arabia and Kuwait who have been placing greater emphasis on local content. Being a GCC member actually affords some advantages in this regard as cooperation council members tend to look upon each other as possessing ‘home’ status. Under this prevailing economic climate in which states are being called upon to create economic opportunities for their citizens, many governments have been giving indigenous companies preference when it comes to tendering and policymaking, much more so than they would ever have done in the past.
Within the UAE, we see ourselves as very well placed to respond to the ADNOC targets. These goals have been around for quite a few years so everyone has had ample time to prepare and strategize. ADNOC’s ambitious production expectations are meanwhile very much in line with a regional trend with Kuwait striving to increase production to 4 million barrels/day and Saudi Arabia to expand to 12 million so we are witnessing fresh opportunities unfolding across the Middle East.
Elsewhere, we identify strong growth potential in Egypt and should be soon increasing our activities in that country. We’re talking about a business environment with over 30 oil companies possessing concessions and more rigs reputedly on the way. Meanwhile we have some working assets in Morocco, are contemplating entry into the Tunisian marketplace and still maintain a nominal presence in Libya despite the intricate political and security scenario.
How does being headquartered in Abu Dhabi fit in with this strategic plan for the MENA?
Very well indeed: being based out of Abu Dhabi affords a reputational advantage because the brand travels well throughout the MENA region. Many associate the UAE brand with high levels of technical quality, competence and professionalism which means we benefit from a lot of goodwill when we bring our business beyond GCC frontiers.
ADNOC has stated its goals of reaching 70% oil recovery targets in the coming years, which as we both know is extremely ambitious. Being that AlMansoori brings about the “best and most affordable technology to its customers” to help customers maximize recovery from producing reservoirs, what unique technologies does AlMansoori possess that ensure it will remain a relevant player in Abu Dhabi’s oil and gas industry in the coming years?
We are constantly on the lookout to partner with small technically savvy oil and gas sector firms possessing niche technology applications that can add tangible value to our overall service offering. ‘Omega Completions’ which is an Aberdeen-based outfit is a case in point. They specialize in down-hole completion tools such as thru-tubing bridge plugs and cement retainers and by adding that sort of technology to our overall package we can really differentiate ourselves from our competitors.
We also develop in-house technologies in the sense of reconfiguring combinations of existing technology to make it to work in more optimal ways. When a client comes to us with a technical problem, we are often able to provide customized cost-effective solutions using existing products on the market but using them in more enlightened ways. Our big international competitors, by contrast, will revert to their large-scale R&D centers and instead design entirely new premium products that will be very expensive for the client. Especially in this moment of cost cutting, many clients will prefer to work with us.
When we met with Weatherford’s Area Director, Mohamend Galal, he stated that Weatherford differentiates itself by offering various service lines, such as underbalanced drilling and laboratory analysis, among other niche technologies, which resulted in Weatherford being awarded a drilling project with 14 out of 20 of ADCO’s wells over the next three years. How do you believe AlMansoori differentiates itself from its competitors? How can clients unlock more value by partnering with AlMansoori?
Our core strength is our well testing. We’ve tested more of the high-pressure sour gas wells in the region than anyone else making us the market leader in that particular domain. Countless time we’ve gone head to head with the big four oilfield service firms for this sort of contract and ended up winning the tender. Supermajors like Shell have preferred us to some of the household Western brands because we can deliver a demonstrably better service.
In terms of partnering, the advantage we offer to anyone unfamiliar with the Middle East is that we are so well established in the region. We know all the customers and the markets. We’re well entrenched and can gain access to clients for them rather than them having to knock on the doors and cold call. We can literally open the doors for them.
What will become of AlMansoori over the next three to five years?
I expect us to up our game and take this business to the next level. We will do what we have always done really successfully but in an improved manner. Next year, we will roll out and implement SAP software that will allow us to come up with some good metrics to analyze exactly how we go about doing what we do in and enable us to tweak our business processes. As always, the critical issue is to ensure total client satisfaction.