MULTI-CRITERIA DECISION-MAKING MODEL APPLYING AN ANALYTIC HIERARCHY PROCESS (AHP) ON THE BUSINESS STRATEGY IN PT ENERGI ABADI

• Main Author: Friska Sirait, Bella
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/62857
• Institution: Institut Teknologi Bandung

The oil and gas production will continue growing through 2050 amid rising global energy consumption driven by developing Asian economics as predicted by U.S. Energy Information Administration (EIA). In contrast, Indonesia unfortunately has experienced the naturally down trend of oil and gas production by mature of oil and gas fields in Indonesia and yet discovered significantly new reserves. The decreasing production is fall on to the most oil and gas companies in Indonesia which already in the production stage. This challenge is also occurred in PT Energi Abadi with impacted to the financial performance of the Company which eventually impacted to its cash availability for settling the payment of the Company’s financial obligations which will be due shortly. In order to respond such condition, PT Energi Abadi shall take the extraordinary action in developing its business strategy. This study is aim to offer the solving of the problem to PT Energi Abadi by applying Analytic Hierarchy Process (AHP) method as one of the Multi Criteria Decision Making (MCDM). The development of AHP method is conducted by literature review, brainstorming and surveying to the experts consisting of management and the key roles of employees commonly participated in the developing of Company’s business strategy. As the result of the brainstorming and survey to the experts in the Company, there are there (3) criteria among others Production, Financial, Market and eight (8) sub-criteria composing Well Program, Reserves Replacement Ratio, Inorganic Growth, Revenue, Direct Cost, Financial Risk, Supply Capability and Market Reputation which lead the Company to has three (3) alternatives which are Optimization, Stand Still and Growing. Optimization is the combination plans between divestment and organic growth on the existing assets, whereas Stand Still is the plan to maximize the existing assets without undertaking the divestment, and the latest is Growing which the combination plans between divestment and inorganic growth by taking over the new assets for replacing the divested ones. By analyzing with AHP method, the best alternative for the Company in this time is Optimization provided that several challenges that the Company should take notice.