The data from this second stage are consistent with

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Unformatted text preview: rature. Second, using semi-structured interviews a description of the use of decision analysis in investment decision-making in the upstream was produced that is representative of current practice in the industry. The data from this second stage are consistent with previous research that indicated a gap between current practice and current capability in investment appraisal (for example see studies by Arnold and Hatzopoulous, 1999; Carr and Tomkins, 1998; Schuyler, 1997; Buckley et al., 1996; Shao and Shao, 1993; Kim, Farragher and Crick, 1984; Stanley and Block, 1983; Wicks Kelly and Philippatos, 1982; Bavishi, 1981; Oblak and Helm, 1980 and Stonehill and Nathanson, 1968). The findings as such are demonstrably valid and reliable. Thirdly, using the data gathered from the research interviews and publicly available financial data, the relationship between use of decision analysis techniques in investment appraisal decision-making and good organisational performance was investigated statistically. As such the research has contributed to the current 69 discussion (for example, Clemen and Kwit, 2000; Clemen, 1999) in the decision theory literature of the relationship between normative and descriptive models of investment decision-making. Furthermore, since the sample used in this research contains 87% of the U.K. petroleum operators, it is clear that the findings are representative of all U.K. petroleum operators. Moreover, since most of the oil companies that operate in the U.K. are amongst the major players in the oil industry, the findings can be said to be indicative of investment decision-making practices in the major companies in the worlds’ upstream oil and gas industry. As with any research, the results have to be interpreted bearing in mind some limitations. The context within which the research is undertaken inevitably impinges on the actual articulation of the research methods employed. In this regard the time, and by implication the resource limitations, influenced the final methodology adopted in three ways. Firstly, time and resource constraints precluded the use of observational research techniques that would have facilitated an enhanced understanding of the dynamics of the investment decision-making process and the links between the different stages of the process, the “soft” effects on organisation performance from using decision analysis and the relationships between the individuals involved. Secondly, the research was limited to a single time period that coincided with a period of very low oil prices, proliferation of mergers and corresponding job losses. Interviewing respondents who knew that they were to be made redundant affected the data gathered from them since respondents often perceived their organisations’ approach to decision-making as extremely poor and portrayed their management in a less than favourable light. In all cases this data was disregarded and other respondents were used in these companies. Furthermore, there was tremendous uncertainty in the industry at this time and many companies were changing their approach to investment decision-making and, as indicated above, were becoming...
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