Abstract
The objective was to build a graphical interface based on quantitative scenarios to track and show the performance of the main productivity indicators to support senior management decision-making. The problems detected within the organization was related to the number of productivity indicators that were independently analyzed without considering the causes and effects that indicators have over one another. The research was carried out by following the proposed system dynamics methodology. The proposal presented to senior management supports decision-making improving efficiency in three respects: 1) service times, 2) responsiveness, and 3) savings and income for the company. Competitiveness is measured in terms of the company's productivity and positioning when improving its operating efficiency. The contribution to the state of the art is the inclusion of an additional phase to the system dynamics methodology related to the development of the graphic user interface for decision-making.
TopBackground
The demand for energy will increase considerably in the coming years as a result of population growth and economic development. According to Repsol (2015), in 2013, the energy demand was 13,559 million tons of oil equivalent. However, a great number of people all over the world are currently experiencing major changes in their lifestyle as they move from a subsistence economy to one based on the service industry. The highest demand for energy comes from developing countries, where an increase of 17,934 million tons of oil equivalent is expected by 2040.
Much of the increase in energy demand will result from rapid growth in Asian economies, especially China and India. The expected energy demand in the developing countries of Asia will grow at an annual rate of 3.7 percent, far higher than that in any other region. Energy consumption in Asia will double over the next 20 years, accounting for around 65% of the total increase in energy demand for all developing countries (Food and Agriculture Organization of the United Nations, 2008).
Nowadays, the Organization of the Petroleum Exporting Countries (OPEC), an organization created to coordinate oil production policies of its member countries, is committed to stabilizing the international hydrocarbon market, making sure oil producing countries obtain a reasonable return over investment, and ensuring the continuous and stable supply of crude oil. The OPEC produces 40% of crude oil worldwide, and 14% of natural gas (Petróleos de Venezuela, S.A., 2005).
However, Urbano (2016) states that while the main oil producing countries in the world are not precisely OPEC members, they supply a large part of the world’s demand. In 2016, the world's leading oil producer was the United States, with a total of 14 billion barrels per year, followed by Saudi Arabia with 12 million. Mexico was ranked in the ninth place with 2.85 million barrels per year; these are produced and marketed and, in some cases, distributed by the company Petróleos Mexicanos (Pemex). Kuwait was positioned in the last place, with 1.5 million barrels less than those produced in Mexico. There are several organizations in the world like Pemex, dedicated to the production, distribution and commercialization of fuels, including Shell, Chevron and Exxon, as well as those solely dedicated to buying and distributing fuel.
The Energy Reform has a set of specific objectives to be achieved by 2025, such as: improving the economy of Mexican families, increasing investments and job creation, strengthening Pemex and the Federal Electricity Commission (CFE), strengthening the state’s leadership as owner of the nation’s oil and gas resources, and as a regulator of the oil industry. Consequently, crude oil production was set out to be increased from 2.5 million barrels per day to 3 million barrels per day by 2018, or more by the year 2025.
Since its creation, Pemex has been the only company responsible for the production, distribution and marketing of fuels in Mexican territory, and only differentiating the business by groups of gas stations under the norms set forth by Pemex; therefore, it is considered a monopoly. According to the National Statistical Directory of Economic Units (DENUE, 2017), there are 10,464 service stations operating in the country, of which 503 belong to the state of Sonora, and there are 71 in the Cajeme region that sell fuel.
The present research focuses on an organization within the energy industry, which due to confidentiality issues, the actual name will not be disclosed; it will be referred to as the Corporation, consisting of business units distributed throughout the region with different lines of business.
As a result of the energy reform, organizations that are in the gasoline service station industry are now facing a number of changes, such as the liberalization of fuel prices and the entry of new competitors with business models that differ from that by which the only fuel retailer in Mexico (Pemex) operated until 2015, when service stations were free to decide whether they would work under the scheme established by Pemex, find another franchise, or create their own brand.
Key Terms in this Chapter
Graphical Interface: Space where the decision makers try different conditions of the parameters and variables to observe their behavior prior to the decision.
Feedback: it is the process that allows to have information of one variable on another or others, during the simulation and not at the end, this allows to adjust on the model to modify, if it were the case, possible decisions that do not affect the desired result by the organization.
Simulation: A behavior based on variables that change over time and that allow decisions to be made based on past and current data to understand future trends.
Scenarios: A behavior of the variables due to changes in the parameters to define situations of risk (pessimistic) or favorable (optimistic) based on the current situation of the system (normal).
Exogenous and Endogenous Variables: The exogenous variables affect the system without the system provoking them (they are situations such as climate, social disorder, crime, etc.), the endogenous variables are those that are within the organization and these affect us because we influence them (e.g. production processes, storage and handling of raw materials, staff schedules, etc.).
Complex System: It is the relationship that occurs between the set of events that are represented by variables and parameters, that interacting and growing in events shapes the complexity of organizations and allows to exploit more information for decision making in different situations.
Dynamic Events: A group of variables and parameters that act separately but not independently, since when connecting event 1 with event n behaviors occur where each event plays a role in the complex system.