March 8, 2010
In 1919, Halliburton was founded by Earle P. Halliburton and is known as one of the world’s largest providers of services and products in the oil and gas industry. Halliburton has many services from locating hydrocarbons, managing geological data, drilling and formation evaluations, to well construction and completion. There are two divisions that make up Halliburton. They are: Drilling and Evaluating and Completion and Production. These two divisions accounted for 18 billion dollars in revenue in 2008. Halliburton employees more than 50,000 people in approximately 70 countries and offer two major business segments. The Energy Services Group provides the technical products and services for fuel exploration and production, and (KBR) Kellogg Brown & Root, Inc. KBR is a construction company that has refineries, pipelines and chemical plants.
This paper will cover the various methods of Halliburton’s planning functions of management, legal issues, ethics, and corporate social responsibility. The paper will also explain three factors that influence Halliburton’s strategic, tactical, operational, and contingency planning.
Planning Functions of Management
As planning is an important function of management, it allows an organization to achieve its maximum potential. The planning function is a methodical approach for taking the goal and turning them into plans and strategies. An example of a planning function that Halliburton utilize is Knowledge Management, which is processes, tools, and behaviors that are deliver the correct content to the correct people at the exact time needed and in the correct context so that they can make the best decisions possible for the business, and promote the newest innovative ideas (Leavitt, 2002). One example of how the Knowledge Management provided value was captured by an electric wire line perforating business development representatives in Houston. One customer questioned which perforating system would be the best one for the well design on the drawing board and whether or not they would be able to retrieve the perforating equipment form the well. As the customer needed this information immediately, the Halliburton BD representative spoke with the community’s full-time knowledge broker about the concern. The knowledge broker then presented the question to the community. With an immediate response, an engineer in New Iberia replied that there were several field people in his location that performed this service and used the system in question regularly and did not know of any problems with it. As this response came back, the BD representative in Houston was able to provide the customer with a screenshot of the responses to the request. The customer then in turn had Halliburton do the work (Leavitt, 2002).
As many businesses have seen their fair share of legal issues, Halliburton is not stranger to the legal woes and have had their share in the past decade. Most accusations are against the division of KBR. Between 1999 and 2000, one legal issue that arose was when orders had been placed with 10 foreign subcontractors that were working on military logistics. The accusation was filed against KBR under the Federal False Claims Act. This accusation included double-billing, inflating prices and providing products that the Army did not need during the construction of Camp Bondsteel in Kosovo (Overbilling, 2006). Eagle Global Logistics (EGL) executive Kevin Andre Smoot pleaded guilty in the US District Court in November of 2003 for making a false statement and violating the Anti-Kickback Act. EGL was hired by the Halliburton subsidiary KBR to ship military cargo to Iraq. EGL paid out to the government $4 million dollars to settle claims under the False Claims Act that EGL had inflated the invoices for the shipments into Iraq. The accused EGL was charged with “war risk surcharging” on