The Saudi Basic Industries Corporation - Essay Example

Some of the well known establishments in the Kingdom of Saudi Arabia, related to the branch of chemistry and dealing in oil, petroleum, chemicals, fertilizers, plastics etc include: Arabian Oil Company, popularly known as ARAMCO, Arabian Gulf Oil Company, Saudi Chemical Company, Petroleum Lubricating Oil Refining Company, Saudi Arabian Fertilizer Company. It is well known that oil is the most important commodity of mankind for his day to day life. Somebody rightly remarked that oil comes next only to oxygen for the living of human being. And he is right. Only difference is that oxygen free is, but oil is chargeable. It is inevitable for all - from the poorest man of the poorest country to the richest man of the richest country. Man needs it for cooking, light, energy, automobile, locomotive, aero plane and vessel – well the list is endless. Its use is abundant. Its use is not limited to mankind, even industries require it. Naturally, the economy of any country depends on the oil resources it has. It is obvious that oil exploring countries are the richest in the world. The Kingdom of Saudi Arabia tops the list in this respect. And the companies dealing in oil ads to the economy of the country. If the manufacturing and sale of the companies in any country increase, the economy of the country will enhance. All companies are subject to risk and uncertainties. But, because the above companies are dealing in oil and oil related products, the risk is less. On the other hand, these companies have rapid growth, oil industry being the most profitable of all industries in the world. Year after year, the turn over and net profits of companies usually increase. Even during the recent recession, which means the country experiences negative growth during the previous six months, these companies were not affected but they prospered. The companies grant a number of attractive perks and benefits to the employees, the most important of them job security. The Saudi Basic Industries Corporation (SABIC), based at Riyadh, Kingdom of Saudi Arabia, is probably one of largest companies in the world, manufacturing Specialized Chemicals, Polymers and Metals and other commodities. All their products improve the standard and comfort of customers throughout the world, who happily use their products. Let us see how the company came into existence. Natural Gas, a useless byproduct during oil extraction had been polluting and harming the environment. The founders of this company wanted to convert it into invaluable petrochemical products for the benefit of mankind. This has resulted in the established of the company in 1976. SABIC is one of the world’s fastest growing petrochemical companies, on account of the farsightedness of the founders. SABIC is playing a large part in making Saudi Arabia as one of the richest nations in the world. The company is considered to be the largest exporters of fertilizers, polymers, and chemicals and steel. The production capacity, volume of sales etc match the best companies in the world. The company aspires to become the topmost in manufacturing chemicals. The company is making all efforts to realize this. The government share in the company is 70%, which is listed in Tadawul, Saudi Arabian stock exchange. The success of the company is the result of the valuable research and training programs and ambitious growth strategy. The company encourages investment in local partnership. SABIC brand ensures products of the highest quality to the customers. And it is the best bet to the shareholders. The six Strategic Business Units (SBU) of the company are: Basic Chemicals, Intermediates, Polymers, Fertilizers, Metals and Special products. The departments such as corporate finance, corporate human resources, corporate control and Research and Technology support the SBUs. Additionally, Shared Services Organizations of the company deal with all matters related to the business. They coordinate between the parent organization and the subsidies, thus ensuring cohesion among all units. This helps in cost reduction, increase in efficiency and prompt and better service to customers. SABIC has more than 30,000 employees, scattered in about 100 countries. All of them are very well taken care of by the company. And they do their best for the company. To control the international operations, there are four regional offices: SABIC in Middle East and Africa: This is the home region of the company. Apart from Saudi Arabia, there are set-ups throughout Middle East and Africa. The main branches are in United Arab Emirates, Egypt, Lebanon and Turkey. SABIC in Asia: Asia pacific is the largest market in terms of Sales. This region has very high potential. The company has offices in Singapore, Indonesia, Philippines, Japan, China, South Koreas, and Vietnam SABIC in America: SABIC Americas Inc. is the subsidy of the company, looking after the operations in the region. There are about 200 employees here. There are research centers in New Jersey and Texas. SABIC in Europe: Acquisition of the company, DSM Petrochemicals, by SABIC paved the way for the first step towards the goal of becoming a global producer. The company has establishments in Germany, United Kingdom and Netherlands. There is also a research centre in Netherlands. There are about 3,300 employed in the region. Worldwide Operations: Thermoplastic materials of high demand are being manufactured in 80 sites in 21 countries in America, Europe and Asia. SABIC is well known for providing engineering thermoplastic material solutions. The company helps customers to design reality from concept. The company has a network of sales offices, storage and distribution facilities, and number of manufacturing sites all over the world. Rapid Growth: The Company has been growing at rapid rate since its inception 1976, throughout the world. It has been acclaimed as one of the fastest growing companies in the world. This landmark is achieved with well planned strategies. This growth of SABIC has been described in corporate circles as “one of the most rapid and coherent industrial development of the 20th century.” SABIC and its affiliates cater to the need of the customers whether their requirement is small or big, however simple or complex. They produce the most modern items and that too at very nominal rate to give full satisfaction to the valued customers, who time and again approach the company for their requirement. Water bottles are made with Polyethylene terephthalate, a plastic chemical material. Intermediates are used to produce varieties of items like toys, medical items etc, to name a few. Polyethylene film is used to store food items. Polyester, the popular synthetic fiber is made out of out our polyester chips. Polymer is used to anything from chairs to cars to aircraft parts. Steel is used in all types of industries throughout the world. Fertilizers help farmers to increase output and nutritious food. Within a short span, the company has risen gloriously. There is no compromise on quality. The policy is to go for high standards in every field. And, the aim is satisfaction and happiness of employees, customers and shareholders. The success story of SABIC is actually a pointer towards the growth of large international business groups which can influence global economy. A business house limiting activities in one country alone can catalyze the economy of that particular country only. But in the case of a company having bases in more than one country, can affect the economy of more than one nation. At least in a few cases various nations will be forced to formulate and bring changes in their policies according to the business tactics of international groups. This shows the relevance, role and power private businessmen achieve in the global economy. Work Cited sabic,http://www.sabic.com/corporate/en/binaries/SABIC_CORPORATE_V2ENG_tcm4-1610.pdf 10 Jan 2008. Web. 08 Dec. 2009. Read More