Strategic Management of BP Oil Company

Business Strategy

Table of Contents
INTRODUCTION.................................................................................................................................3
Task 1....................................................................................................................................................3
Influence of macro environment........................................................................................................3
Task 2....................................................................................................................................................6
Internal environment analysis............................................................................................................6
Task 3....................................................................................................................................................9
Porter Five Forces analysis................................................................................................................9
Task 4....................................................................................................................................................9
Various model, theories and concept used for strategic management of BP oil company................9
CONCLUSION...................................................................................................................................12
REFERENCE......................................................................................................................................13

INTRODUCTION
Business strategy is defined as a process to form different polices and find out
different approaches that can support company in taking competitive advantages in the
market. This report is based on the case study of the BP Oil Company in respect to its
strategy formation. British Petroleum PLC is the summarised form of BP Oil Company. The
organisation was established in the year 1909. William Knox D’Archy is the founder of the
company. Company is associated with the oil and gas sector to conduct business operations.
Headquarter of the company is located in London, United Kingdom. This report will
summarise the different aspects of the strategy formation of BP Oil Company. Henceforth,
report will emphasis on the impacts macro environment in putting over the business
operations of company. This report will also project about the organisation internal
environment and capabilities. Furthermore, report will also project the Porter Fiver Forces in
respect to the organisation. Strategic direction of company will also discuss in this report.
Task 1
Influence of macro environment
Macro environment is defined as the external business environment that influences
company operations. PESTEL Analysis is the suitable tool to assess the macro environment
influences over the company.
PESTEL Analysis
PESTEL Analysis is a precise technique to assess the impacts of different factors
associated with the macro environment. This model comprises with political, economical,
social, technological, environment and legal factors associated with the macro environment.
Political Factor: Political factors involve different policies and strategies frame by
government related to corporate sector. All such government policies related to oil sector are
directly influence the company’s operations. Government approach towards the growth and
development of corporate sector deeply influence the business environment as all policies
frame by government are a reflection of such government approaches. As the government in
UNIETD Kingdom are very progressive towards the growth and development of peoples and
country which allows governments to frame effective policies for the betterment of the
corporate sector as the sector play a huge role in the growth ad development of the GDP

(Fernandes, 2017). Political stability in country also influences the macro environment in
country. Political stability in UK allows government to frame long term policies and
regulations which further drives companies to form long term strategies related to growth of
business.
Economical Factor: Economic factor put huge impacts over the growth of companies.
Economic factors different elements such as currency flow, value of money, inflation, growth
rate of countries GDP and other economic factors. All policies of company related to
business expansion and products are based on the economic situation of country. Company
also make business expansion decisions based on the economic activity of country. Inflation
in economy also play a huge role for the companies as itv directly restricts the purchasing
capacity of the potential customer of company.
Social Factor: Social factors involve demographics of country, culture, religious values in
country, traditions, education of peoples, choices and other social factors. All the social
factors play huge role in taking buying decisions by customers. Company launch different
campaigns such as marketing campaigns based on the cultural factors so that customers
purchasing decisions can be attracted by companies (Camillus, 2016). Company also launch
new products based on the trend and fashion in country. It can be stated as social factors are
among the key business environment factors associated with the macro environment which
influences all aspects of company’s presence in market.
Technological Factor: Technological factors involve all technological advancement in
country. Technology has been proved as the transformation in the business. This factor in
macro environment drives companies to understand all effective technological factors that
can be channelizes by company in order to achieve growth for te business. Companies utilises
technological factors in all its business operations which includes logistics, operations, supply
chain management and marketing. Technology also drives company to conducts research
related to the business and products development activities.
Environment Factor: Environmental factor can be summarises as the recent development in
macro environment. This factors drives company to launch the eco friendly products to meet
the requirements of the potential customers of company (Liu and et.al., 2017). BP Oil
Company also engaged in various social responsibilities as a part of the corporate social
responsibilities under these factors. This factor drives company to build up loyal customer