THE STUDY OF DYNAMIC CAPABILITY ON WORK EFFICIENCY IN THE UPSTREAM PETROLEUM INDUSTRY

Abstract

— Indonesia’s petroleum production each year falls by an average of 5%, while demand increases
by 8% with the tendency for demand to continue to increase. With the widening gap between production and
needs, without discovery of new petroleum reserves and empowerment of energy sources other than
petroleum, an energy crisis will arise. The study elaborates on research models involving work motivation
and innovative behavior as antecedents of the dynamic capability to improve work efficiency. 156
questionnaire samples from 8 petroleum companies was analyzed using Smart-PLS. The findings indicates
that work motivation and innovative behavior of the worker of upstream petroleum company in Indonesia
positively affects individual dynamic capability as a company asset, although innovative behavior has no
positive effect on the efficiency improvement. Dynamic capabilities should reduce time and working process
and simultaneously increase the work efficiency of the upstream petroleum companies in Indonesia.