PTT Public Company Limited is the largest petroleum company in

Thailand. The PTT Philippines Corporation Subic is a subsidiary of the said

company. The main function of which is to maintain and operate terminal and
depot facilities for petroleum and petroleum related products. Group 3,
presented a paper which highlighted the downstream operation of PTT Subic
which is primarily the addition of chemical additive to refine petroleum and
distribution of petroleum products and lubricants. They also discussed the
different segments that the company caters: retail, distribution, aviation and
commercial markets. This paper serves as an evaluation of the operations
audit and recommendations made by the group for the company.
Operation Management provides the over-all understanding on how
management decisions are guided by the framework that managers adopt in
their company and provides systematic design, direction and control of
processes that been able to transform inputs to outputs beneficial to the
company, customers and other stakeholders.
The PTT Operations Audit was well discussed by Group 3. They were
able to present how the company is able to operate based on their own
strategies and principles. Having existed in the Philippines for more than a
decade the company have already established their own operational
strategies incongruence of with their corporate strategies. Along with their
framework, they are able to steer the company on to their desired direction.
The operation strategy of the company is specific and precise that enables
the company to be focused on what they need to accomplish.
Since it is a subsidiary, they follow the implementing rules and
regulations set out by their head office. Although a few government
mandates may affect some of them some adjustments may have been made
in order for them to operate in the local setting.

For PTT Subic, since they are on the downstream production and are
not particularly involved in producing petroleum, the backbone of their
operation is focused on further processing of their base product. Most of their
expenses are geared towards importation of petroleum from their sole
supplier which is their Main Office located in Thailand. For additives, they
only have a handful of suppliers which are located locally. The companys
activities are mostly focused these operations and processed good deliveries
to retailers. They take in the cost of deliveries and do not charge them on
their customers.
For product design, PTT Subic is mostly concerned with two major
categories of products, high volume low variety petroleum products and high
variety low volume lubricant products. They have a limited array of products
but only differ on the quality of products and percentages of chemicals
involved. They may only have a few items on their product line but this due
to their idea of serving low cost petroleum products to customers. This one of
their competitive advantage from other leading petroleum, offering cost
efficient products. Adding more items which would need further processing
would only raise their cost which would then increase their price.
PTT Facilities in the office have the minimum requirement for back
office operation. Some lay out office may need to be rearranged in order to
to minimize time consumption and loss of data for interdepartmental
interface. This applies for the marketing and accounting department. Some
of the office locations may be a bit in question, like location of the IT Staff
from server area and the office of the Operations Manager being on the
ground floor. For its operations layout, it is somehow efficient and cost
effective in the sense that they accessible to their customers through
national road accessibility and the existence of the pipeline connection from
Subic to Clark lessens the costs of operation.

However, location wise, they may face other cost especially on the
cultural side. They are located on the Boton Area which is under the cultural
grounds of the Kanawan Community of the Aestas. In the coming years,
when the National Council for Indigenous People (NCIP) formulates the
necessary paperwork, a portion of the companys revenue as well as the
other companies within their cultural grounds will be given to the community
as homage for use of their land.
For Human Resource, their employees benefits are not well presented.
They only presented the work hours, labor quantity and needs for each job
but not necessarily the whole recruitment process, employee packages and
other benefits like manpower development, incentive programs and bonuses.
This is in reference to the performance evaluation wherein the satisfaction of
employees are rechannelled on their quality of service and effective
performance on their work.
For Quality Management, although PTT Subic has been a recipient of
numerous

awards from Thailand (Thailand Quality Awards) and the

Philippines Quality Awards which all follow the Baldrige Excellence program,
PTT still needs to focus on the improvement of their service quality like
emission testing for customers, incentives and the like to further uplift
customer satisfaction. Their focus on the product may be exceptional but
they too need to cater to their customers. For further improvement they may
need to acquire ISO certification which entails them to make changes on
their processes, documentation and other areas in order to qualify.
Overall, PTT Subic for a short period of time has already progressed as
an institution. They were able to have a strong hold of their own identity as
an organization, have their own market share, and have a distinct variety of
products and good facilities from layout and location. However, like all things
there are still areas that need improvement. These things can be

accomplished through the application of various theories and strategies

backed up by experience and current market trend and also with proper
manpower supervision and development.