Management imprint associated with the recovery and outstanding development of Petrovietnam
Rising from the crisis and growing spectacularly
From the end of 2014 to 2019, Petrovietnam fell into an unprecedented crisis period in history due to both objective and subjective reasons. These were the impacts of economic recession, prolonged sharp decline in oil prices, decline in oil and gas production, policies and mechanisms for the development of the industry revealing many shortcomings in the new situation, ... along with limitations, shortcomings, violations, and shortcomings of the previous period from incidents, weak projects, hot development, and deviation from the core... All of these have seriously affected the operational efficiency, reputation, and brand of Petrovietnam, production and business activities have declined, some projects have fallen into a deadlock, many units have encountered difficulties and losses, ... From there, it has affected the jobs and lives of workers; the trust of the leaders of the Party, the State, of society and of the Oil and Gas workers has seriously declined.
In 2017, Petrovietnam reported to the Prime Minister its financial picture, predicting that by 2019, the Group would have an imbalance in cash flow and fall into an extremely difficult situation. Those who had been involved with and witnessed the Group during that period must still remember the extremely difficult situation, with many judgments and doubts about Petrovietnam's ability to recover and the continued development of the Oil and Gas industry. The cultural damage was so profound that many officials and workers did not dare to call themselves Oil and Gas people.
In that context, with the attention, direction, rectification and support of the Party and State leaders, especially in personnel work, Petrovietnam has carried out comprehensive reforms and gradually overcome difficulties and challenges, developed stably and regained growth momentum.
Prime Minister Pham Minh Chinh visited and encouraged oil and gas workers at the construction site and affirmed the achievements of Petrovietnam in recent years.
This is shown through specific figures such as: Petrovietnam's total assets in 2023 increased by 19% compared to 2020; Total revenue in 2023 increased by 81% compared to 2020; State budget payment in 2023 increased by 83% compared to 2020. Petrovietnam's brand value in 2023 reached nearly 1.4 billion USD, 3 times higher than in 2019.
By the end of 2023, Petrovietnam had successfully completed 2 years ahead of schedule the 5-year plan for the period 2021-2025 assigned by the Prime Minister in terms of the targets of paying to the state budget and consolidated pre-tax profit. It is estimated that by the end of 2024, Petrovietnam will exceed the 5-year plan in terms of total revenue. Thus, after 3 years (2021-2024), Petrovietnam has fully completed the financial targets according to the 5-year plan 2021-2025.
Currently, Petrovietnam annually supplies nearly 9-11 billion m3 of gas for the production of 35% of the national electricity output, 70% of the nitrogenous fertilizer output and 70-80% of the gas for domestic consumption in the country. Petrovietnam is also the second largest enterprise in electricity supply with a total capacity of power plants reaching 6,605 MW, accounting for about 15% of the total national electricity output. The total consolidated assets of the entire Group currently reach over 1 million billion VND (equivalent to about 43 billion USD); equity capital of over 530 thousand billion VND (23 billion USD), leading in non-financial enterprises. The average annual total revenue is equivalent to about 9-10% of the country's GDP; the average annual payment to the State budget currently reaches 9-9.5% of the country's total budget revenue... and many other impressive figures and results.
Petrovietnam affirms its leading role in the economy and national energy security
With high efficiency in production and business, Petrovietnam has fulfilled its role well in association with the “5 words An”: Ensuring energy security, food security, economic security, national defense security and social security. Since then, the Group has restored the trust of Party and State leaders, people of all walks of life, and oil and gas workers. In addition, it has also created a solid foundation and basis for the Group to implement strategic goals in the next phase.
Management marks
The spectacular comeback, overcoming the crisis, and at the same time facing new challenges to turn "danger" into "opportunity" from 2020 to now is the effort, perseverance, and persistence, with many solutions implemented synchronously and drastically by Petrovietnam, which are consistent with extremely unique, creative, and effective management marks, serving as a guideline for all activities.
Petrovietnam Chairman of the Board of Directors Le Manh Hung reports to Prime Minister Pham Minh Chinh on production and business activities.
Managing change, promoting efficiency
Since 2020, for the first time, Petrovietnam has identified and proposed the action motto of the year. These are considered comprehensive solutions, demonstrating the management guidelines and orientations for operations and production and business activities throughout the Group, in order to overcome difficulties and fluctuations, take advantage of opportunities, and reach the finish line successfully.
In 2020, in the extremely difficult context of the "double crisis" caused by the Covid-19 pandemic and the unprecedented decline in oil prices in the history of oil and gas trading (at one point, WTI oil price dropped to minus 37.6 USD/barrel), with the motto of action " Managing fluctuations, Optimizing value, Promoting consumption, Strive to overcome difficulties, Seize opportunities, Safely reach the finish line" , Petrovietnam is one of the few oil and gas companies in the world that has overcome the crisis and safely reached the finish line with a profit of nearly 20,000 billion VND.
By 2021, Petrovietnam's operations will be aligned with the motto of "Managing fluctuations, Maximizing value, Expanding markets, Seizing opportunities, Linking investments, and Restoring growth". The Group continues to steadily overcome the storms of the widespread Covid-19 pandemic, severely affecting all aspects of economic and social life, and comprehensively completing all aspects of production and business activities, achieving the goal of recovery and growth compared to before the Covid-19 pandemic.
From 2020 to present, Petrovietnam has strongly recovered and continuously set new records in production and business.
In 2022, Petrovietnam set the motto of action "Managing fluctuations, Anticipating trends, Connecting resources, Promoting technology, Promoting investment, Sustainable development" as its goal. As a result, the Group has achieved many new growth records in its history. In particular, the Group's total revenue reached 931.2 trillion VND, up 48% compared to 2021, setting a new peak, although this was not the highest year in terms of exploitation output or oil prices. The Group's total State budget contribution in the year reached 170.6 trillion VND, exceeding the annual plan by 2.64 times, up 52% compared to 2021.
By 2023, the Group continued to break its own record with the Group's total revenue reaching VND 942.8 trillion, exceeding the annual plan by 39%, VND 11.6 trillion higher than the record in 2022, equivalent to 9.2% of the country's GDP. During the year, the Group's activities were associated with the motto of action "Managing fluctuations, Expanding scale, Accelerating digital transformation, Shifting models, Improving productivity, and Regenerating business" .
In 2024, with the motto of action "Managing fluctuations - Adding new motivation, Renewing old motivation, Creating new energy sources, Reaching new heights" , Petrovietnam continues to successfully complete all aspects of production and business activities and aims to reach 1 million billion VND in total revenue, setting a new record.
These are excellent results, associated with management directions that are very close to reality, showing the Group's acumen, sharpness and strategic vision in management. And throughout it is the motto "Managing fluctuations". This is one of the new, unique and creative management solutions at Petrovietnam, helping the Group respond promptly and effectively, minimizing the damage from negative fluctuations in the macro situation and the market; at the same time, taking advantage of new opportunities to achieve the highest production and business efficiency.
Chairman of the Board of Directors of Petrovietnam Le Manh Hung commented that in the context of the world situation in recent years being full of fluctuations, uncertainty, and unpredictability, and the specific nature of Petrovietnam's operations being large-scale, it is greatly affected by the market and the macro-economy. If fluctuations are not well managed, there is no way to achieve comprehensive victory because "it is easy to gain in this place/in this field but also very easy to lose in another place; gain now but can also lose all achievements very quickly when facing market reversals and bad fluctuations". From there, fluctuation management was introduced and became a culture, promoting effectiveness in Petrovietnam's corporate governance.
Cultural reinvention sets the stage for business reinvention
Along with production and business, an inseparable process in recent operations that the entire Petrovietnam system has been interested in implementing is Corporate Culture Regeneration (VHDN). Since the end of 2019, Petrovietnam has officially approved the Petrovietnam Culture Regeneration Project, based on core ideas including: Core Purpose and Core Value System, screening and eliminating toxic culture; updating and supplementing progressive and modern culture with synchronous and specific solutions such as forming 7 effective habits, etc. From there, regenerating and elevating Petrovietnam culture associated with the core value system of "Aspiration - Intelligence - Professionalism - Compassion" takes place every day, every hour, in each administrator of Petrovietnam member units, shifting from management culture to governance, building a scenario of fluctuating governance, linking macro to micro, long-term vision, not linking organizational development with individual tenure. Petrovietnam culture has therefore penetrated deeply and spread more strongly, turning pressure into motivation, building a management plan for the following year higher than the previous year, firmly maintaining the growth target has also been formed. Along with that, the culture of solving big problems has changed, creating cohesion and consensus in the entire Petrovietnam system towards the common goal of solving difficulties and obstacles, bringing the Group and units to develop and rise.
Through 4 selection rounds from 2021 to present, Petrovietnam and 15 units in the Group have been among the total of 75 enterprises nationwide recognized as Enterprises meeting Vietnamese Business Culture standards, of which Petrovietnam was recognized in the first round of review.
Workers' confidence is strengthened and enhanced.
Mr. Ho Anh Tuan, Chairman of the Vietnam Association for Corporate Culture Development, shared: “We clearly see the special attention of Petrovietnam’s leaders to the development of corporate culture. The apparatus implements corporate culture work methodically, enthusiastically, with many creative, unified and harmonious ways. Petrovietnam is not only a pillar of the country’s economy but also builds a very good corporate culture. This is the foundation and launching pad for Petrovietnam to complete the tasks assigned by the Party and Government, continuing to affirm its position domestically, regionally and internationally.”
Linking the chain, forming the Petrovietnam ecosystem
Another outstanding management solution of Petrovietnam is to form linkage chains, build the Petrovietnam ecosystem, to enhance coordination of activities, cooperation, utilization and sharing of resources within the entire Group, thereby promoting internal strength, improving efficiency, competitiveness and increasing resilience, responding to difficulties and fluctuations.
Petrovietnam units promote cooperation and development
Since 2020, Petrovietnam leaders have directed the promotion of linkage, formation and development of value chains throughout the Group. Up to now, dozens of linkage chains have been formed and put into operation, promoting efficiency in practice... Developing value linkage chains within the Group also actively contributes to member units working together to research solutions to maximize resources, innovate to develop new products, and increase the efficiency of units.
In the new journey, Petrovietnam continues to affirm the spirit of "One Team, One Goal" , promoting connections to increase the strength and efficiency of the Petrovietnam ecosystem, capable of coping with all difficulties and challenges, successfully implementing the strategy; along with that, expanding cooperation with units outside the ecosystem, building an integrated model inside and outside to aim at becoming a national Industry - Energy Group, associated with the requirements of rapid and sustainable development.
Growth Management
Another thing that is easily seen in Petrovietnam in recent years is the trend of sustainable growth, with each year being higher than the previous year. This has been a drastic requirement in the Group throughout the past period. Especially in 2023, this task was concretized, when for the first time Petrovietnam issued a management plan according to Decision No. 529/QD-DKVN on assigning goals and key tasks of the year with extremely challenging goals and plans, higher than those assigned by the Government, Ministries/sectors. This demonstrates great determination, when the Group puts itself under "pressure" to "grow", even on the very high foundation of the production and business results achieved in 2022 with many records set. On the basis of that management goal, the entire Group has strived and surpassed itself, setting new records in 2023.
Entering 2024, the growth task continues to be set. The management objectives according to Decision 529 (retaining the same name) were once again issued and entered into business life throughout the Group, becoming a vibrant emulation movement, a basis for evaluating the implementation of tasks throughout the Group.
Preparing for the 2025 plan, the "requirement" of growth continues to be put on top by Petrovietnam, along with Petrovietnam's "double-digit" growth target, Chairman of the Board of Directors of Petrovietnam Le Manh Hung emphasized, "To move towards a new era, the era of national growth, it must be associated with the mission of the cells in the economy, which are enterprises, entrepreneurs and people. In such a context, we are not allowed to set a low growth target. At the same time, we must link growth with increased income and welfare for workers, harmonizing the interests of the State, enterprises and workers". That is the spirit in strategic planning, to organization and implementation at Petrovietnam, as well as the member units of the Group.
The task is not only an order but also a solution and preparation of resources to carry it out. From the Group to the member units, we all aim for a common goal, fulfilling our responsibilities and tasks in our positions. Petrovietnam leaders and professional departments are fully informed to fully support and make timely decisions to help member businesses achieve their goals. Each unit in the Group is struggling to see the potential, renew traditional driving forces and add new driving forces for growth.
Petrovietnam Chairman Le Manh Hung has repeatedly emphasized that if one "refuses to grow", confidently setting a "safe" plan, one year lower than the previous year to easily exceed the plan, is a very dangerous thing in management. Growth and the desire to reach out must be present in Petrovietnam's leadership team to continuously develop the business, contribute to the economy and take good care of employees. He has also repeatedly urged member units not to limit themselves, to consider what they have achieved as the peak, but to always think bigger, act bigger to reach new heights.
Export of offshore wind power footings
Not only achieving high results in production and business activities, Petrovietnam has made appropriate changes to create momentum for growth and development in the next period.
These are some of the typical management solutions, among many solutions that have been put into practice in Petrovietnam's production and business activities in the recent period. In which, Petrovietnam has truly shown innovation, positive changes, improved management efficiency, and a modern, multi-level, multi-field approach with high integration with the goal of ensuring a synchronous and comprehensive business operation system from strategic planning, organizational model, financial system to human resource management, resources, production organization and market development, towards sustainable development. This helps Petrovietnam promote management efficiency, production and business activities achieve high results, and at the same time shift the business model towards a more sustainable direction, with stable revenue and profit structure between fields, growth, no longer relying solely on the oil and gas exploitation sector.
Ms. Ha Thu Thanh, Chairwoman of the Board of Directors of the Vietnam Institute of Directors (VIOD), commented that Petrovietnam is a pioneer in changing corporate governance awareness in Vietnam. Petrovietnam's leaders, especially Chairman of the Board of Directors Le Manh Hung, have built corporate governance into the program, system and deployed it to Petrovietnam's capital representatives in member companies. This demonstrates the commitment of Petrovietnam's leaders to implement corporate governance in an effective, transparent and secure manner, not only to reduce capital loss, but also to use that capital in the most effective way.
The recent period marked Petrovietnam's outstanding success, associated with the right and skillful management direction, which has brought Petrovietnam to spectacularly overcome difficulties, grow, develop, and establish a new position. Thereby, creating a solid foundation, along with appropriate shifts for the Group to accelerate and break through in the new period, aiming to become Petrovietnam - the National Energy Industry Group , actively contributing to the "transformation - rise" of the country in the new era.
Mai Phuong
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Source: https://www.pvn.vn/chuyen-muc/tap-doan/tin/1301ba0b-3fd9-40d6-bec3-10e8f7445d22
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