British Petroleum's Strategic Management and Sustainability Analysis

This report provides a comprehensive strategic analysis of British Petroleum (BP) within the global haulage industry. It employs several strategic tools, including PESTEL analysis to evaluate political, economic, social, technological, environmental, and legal factors impacting BP. The report also examines the industry life cycle, assessing BP's position through introduction, growth, maturity, and decline phases. A SWOT analysis identifies BP's strengths, weaknesses, opportunities, and threats, while the Five Forces model assesses industry competitiveness. The analysis considers BP's market leadership, operational challenges, and sustainability efforts, particularly in light of environmental concerns and regulatory pressures. This document is available on Desklib, a platform offering various study tools and solved assignments for students.

STRATEGIC MANAGEMENT
AND SUSTAINABILITY
ASSESSMENT 1

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
PESTEL analysis.........................................................................................................................1
Industry life cycles......................................................................................................................3
SWOT Analysis..........................................................................................................................4
Five force model.........................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Strategic management refers to the plans of action the company formed in order to
accomplish the goals of the organization. Basically it is the process which involve setting of
goals, procedures and objectives for the company in order to deliver high competition in the
marketplace(Andreeva, et.al 2019). It plays vital role in the proper functioning of the
organizational function as it helps in improving the operational area. The present report will
examine the various strategical analysis for the global Haulage industry and British petroleum. It
is the leading industry of the UK with high market growth rate. For the analysation the study
highlight the strategic tools such as PESTAL, SWOT, industry life cycle and five forces model.
.
MAIN BODY
The British petroleum company plc. Is one of the largest oil and gas multinational
organization which is having the headquarter is in London, England. It offers wide range of the
opportunity to the peoples and workers of the organization. The company offers refine and crude
petroleum to the various haulage industry as well as the consumer. The organization leading the
domestic as well as international market with adequate gross profit. For the analysation of the
strategies the organization utilized various analytical tools which are mentioned as follows:
PESTEL analysis
PESTEL analysis is the most suitable framework for the largest organization which is
leading different market segments (Fitri, et.al 2019). Similarly, for the British petroleum
industry it is important to analysis the factors which are affecting the enterprises. The petal
analysis consist of different factors or the elements as the pastel indicate political,
environmental, social, technological, economic and legal factor.
 Political: the political factor is the essential element for the growth of the organization
and or is important to determine the factor. It includes the policies which is formed by
the ruling government for the companies. In context of British petroleum the
organization formed the plans of action as per the political decisions, new tax regimes
and enforcement of countries legal system. While the oil and the petroleum company is
facing some sort of petrol supply chain issue the government of country analysis the
issue and deliver support to organization. The political people cooperate with the
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enterprise in order to resolve current problem. The government encourage the company
to take initiative of operational decision-making process. Due to the Brexit the issues of
supply chain increased in the country.
 Economic: it is the factor which affect the economical valuer of the company. For the
growth of the company it is essential to determine the inflation ate, saving, interest and
foreign exchange rate as various company has different economical cycle (Hartmann and
Vachon, 2018). The spending of the money on the oil and gas industry is also considered
in this factor. The British petroleum industry contribute equally in the growth rate of the
country's economy. Organization balance the economy with the assistance of the
economic factor. The industry is unable to deliver the fuel to many retail stores or the
transport industry due to that issue the company face some sort of crises along with
downfall in the economy of the company.
 Social factor: it refers to the culture, belief and the values that people are considered
before buying any product or services. The social trend impact the buying preference of
the consumer. Similarly, the increment in the population is another social factor that
affect the company because as the population raises the demand for the petrol also
increases in the country. As per the study when the organization is having the issue the
traders become worried of the outcomes. The company apologies for availability of the
fuel built grate impression on the minds of the people. Along with that that issue also
decrease the brand value in the marketplace. The cultural environment of the
organization is considered in the social factor as it include the behaviour of the people
working within the firm.
 Technological factor: it involves the innovation and modification of digital techniques
within the organization. It is highly affective element in the transport industry. The
industry is growing fast with the assistance of availability of wide technology in the
marketplace. The industry utilized the technology to analysis the pros and cons along
with the distribution oft oil and gas in the marketplace. The organization detects the
issue rapidly and announce the early warning to the consumer (Hatefi and Vahabi,, 2018)
. With the help of the technology the members of the company able to announce the
message of the issue the organization is facing. For the monitoring and the controlling
the enterprise adopt secure IT system.
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 Environmental: it affects the profitability of the company,. In this factor the people of
the organization is concerns about the natural climate which is important to be
considered by the organization. The change is tin the climate affect the industry brutally.
The company suppose to put more effort in order to reduce the green house emission.
The company maintain the pipelines in order to supply the fuel rapidly and effectively to
the retail sites. The industry decreases the utilization of the harmful gases and lower the
pollution spread by the transport services.
 Legal factor: in the globe the various countries having different legal system in order to
mange the function in more effective and adequate manner. The industry analysis the
usefulness and discrimination of the law(Heffron, et.al 2021). In the united kingdom the
legal system is concerned with the people who are associated with the industry. The act
of renewable transport fuel obligation pressurized the buyers to utilized bio fuels which
affect the performance of the company in the marketplace. The law of the country deliver
extensive support in order to operate the function of the company. The legal system give
assistance to the company in convincing the people or the regular byers of the
organization.
Industry life cycles
This life cycle indicate the evolution of an industry with the assistance of four phrases.
As the business required time period to grow in the marketplace it is important to consume less
time. Basically it depends on the company that how rapidly the company acquire the market. It
is essential to utilize the life cycle stages to identify the performance of the company. Further it
gives assistance in comparing the company with the other competitors available in the
marketplace (Kreps,2019). The phrases which are involved in the evolution cycle is bifurcated
as follows:
 Introduction: this phrase is the first stage of any business enterprises when the
organization introduces the company by spread awareness among the people about the
product and service the company is offering. Similarly, the British petroleum utilized this
stage to increase the business value and attract huge amount of consumers in order to
maximize the profit of the company ass well as lead the marketplace. The organization
invests the capital in the promotion activity to established and operate the business fully.
The organization work on the technology to develop the competition in the market.
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 Growth phrase: it is the second stage of the business when the company acquires the
market and already introduced in the marketplace. In this stage the business enterprises
reorganized as the brand in the marketplace. The employees of the firm work on the
productivity in order to boost the sales and increase the revenue with the cash flow. In
the case of oil and the gas industry thee business grow when the population increase as
well as increase in the Demand of transport industry rapidly. For the scaling up the
growth of the industry the organization deliver the services 24 hours with the minimum
price. The British petroleum accelerate the market share of the company in order top
grow and acquire whole marketplace. Furthermore, the company work on the feedbacks
deliver by the consumer as the area of improvement (Meunier, et.al 2020)
 Maturity phrase: in this stage the organization started growing and reaches to the
maximum size. The organization encourages the consumer to buy the product which is
offered by the company. At this stage the company do not acquire any sort of growth
just aim of increasing the market share a well as profitability of the company. The
growth of the organization slow down as the competition increases in the marketplace.
Although the British petroleum manage to maintain the relation with the consumer by
delivering the transparency and loyalty to the consumer. While the company is having
the supply issue the sales of the company started loosing in the marketplace.
 Decline stage: it is the last stage on the industry life cycle when the company started
declining in the marketplace. In that state the organization do not generate the profit but
face some losses as the company started losing the value in market. The oil and the gas
industry come on that stage when the organization is having issue with the supply of fuel
in the country (Naim and Bisson). The institution is unable to deliver the fuel to the
consumer which drop the sales and affect the profitability of the organization. This
pressurizes the business enterprise to improve the services of the company.
SWOT Analysis
The British petroleum is one of the largest organization which grab wide range of the
strength and the opportunity in the marketplace. As this business enterprises is largest and
operated in the international market it has some sort of threat as well as the weakness in the
marketplace. In order to improve the weakness of the company it is vital to identify. With the
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assistance of swot analysis the organization highlight the strength, weakness, opportunity and
threats of the company in the following manner as follows:
Strength: the most essential strength of the organization is having the great image in the
marketplace along with geographical diversity (Padash and Ghatari, 2020). It is one of the
biggest enterprise which deliver the exclusive energy in the oil and gas sector. The operational
function of the company is operated with the high quality. The name and the fame of the
company is strong in domestic as well as international market because of which the company is
acquiring high profit and satisfy the consumer.
Weakness: to survive in the marketplace it is important to determine the weakness of the
company. It gives assistance in improving the area to satisfy the consumer of the organization
and generated new customers for the welfare of the company. The company is unable to meet
the demand of the consumer as they are facing the issue of fuel supply chain. One of the
important work which the company should consider that is the oil spills and issue of
environmental damage all over the world. The organization shut down many oil wells and
managed work economic cycle and unable to fulfil the responsibility.
Opportunity: the organization is having the opportunity to resolve the issue in order to attract
the consumer and generate the profit to acquire the marketplace (Purba and Septian, 2019).
Along with this the company has the chance to increase the potential through launching the new
project in the marketplace. The company can generate more profit by increase the consumption
of the fuel as well as the price. Furthermore, the company can expend the market of natural gas
and increase the scale of the profit. The institution has the probability to invest in other business
which are different from, the oil and gas industry.
Threats: due to the rules and regulation imposed by the government the company is having
trouble in accomplishing the opportunity and increase the market share of the company. Along
with this the organization is facing high competition in the marketplace which is one of the
factor because of which the company is enabled to grow more in the market. The another threat
is increase in the price of the operation of the company, the people of the company started
avoiding the consumption of the product offer by the company. Basically thereat are the barriers
of the company (Shaw and Donovan, 2019).
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Five force model
Porters five force models refers to the model which determine or analysis the five
competitiveness that modifies the function of the industry along with the strength and
weaknesses of the business enterprises (Szum and Nazarko, 2020). It is widely used by the large
company in order to build various plans of action for the welfare of the company. It gives
assistance in increase the competitive advantages of the business and encourage the profitability
of the company. The five force model is bifurcated into five different elements which are
mentioned as follows:
 Competition in the industry (high): the British petroleum company has numbers of the
competitors in the marketplace and capability to defeat the competitors of the company.
The company has high competition in industry due to availability of many companies in
the marketplace. The organization offer wide range of the products and service to global
Haulage industry the consumer in order to satisfy them and generate the profit for the
organization. Along with that the company had power to charge high price from the
consumer while the compensative competition is low. The organization set the terms to
increase the sales and the profit of the company to face the forthcoming challenges.
 Potential of new entrants into an industry (low): the organizations power is also
affected by the forces of new entering companies in the marketplace. The competitors of
company need to invest less amount in the market research (Tsangas, et.al 2018).
Although the new entering company has high competition in the field off oil and gas
industry as many other company already leading the market and it required huge amount
in the infrastructure. The leading company become the strong barriers for new entering
company as they already acquire the market and form sort of strategy to lead the market
in effective and efficient manner.
 Power of the supplier (high): the power of the supplier is high in this industry as the
petroleum industry is largely depended on the other company and import the petrol form
other country. The organization is depended on the power of the suppliers they can not
generate the petrol. The suppliers of the company are limited in the industry so the
organization has opportunity to enhance the profit.
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 Powers of the customers (medium): the ability to drive the price of oil and gas is the
medium because the price of petrol is decided by the government as they impose taxes
on product and the servives of the company.
 Threats of substitute(high): the availability of the treat is high as there are so much
petroleum company available in the marketplace which deliver similar service to the
consumer. In context to that the buyers of the organization have opportunity to shuffle
the preferences of buying the product from the organization.
CONCLUSION
From the above report it will be concluded that the strategic management is essential
element to considered for the growth of the company. In order to survive in the marketplace it is
important to analysis all the pros and cons of the company so the organization able to meed the
demands of the consumer (Xu and Liu,2019). The present report shade light on the leading oil
and gas company of UK which face the issue of supply chain. In that problem the company is
not able to deliver the services to the consumer which decrease the image of the company in the
marketplace. Furthermore, the report also highlighted the analysation of various tools which are
necessary for the proper operation of the company.
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REFERENCES
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performance: The interactive role of industry context. Business Strategy and the
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Hatefi, M.A. and Vahabi, M., 2018. Strategies of Oil and Gas Projects, on the basis of Project
Management Knowledge.
Heffron, et.al 2021. The emergence of the ‘social licence to operate’in the extractive
industries?. Resources Policy, 74, p.101272.
Kreps, D.M., 2019. Microeconomics for managers. Princeton University Press.
Meunier, et.al 2020. Alternative production of methanol from industrial CO2. Renewable
energy, 146, pp.1192-1203.
Naime, S. and Bisson, C., A Scenario Approach for Better Anticipating the Oil Market
Shifts. M. ATİLLA ÖNER A. KEMAL TUĞCU, p.285.
Padash, A. and Ghatari, A.R., 2020. Toward an Innovative Green Strategic Formulation
Methodology: Empowerment of corporate social, health, safety and
environment. Journal of cleaner production, 261, p.121075.
Purba, J.H.V. and Septian, M.R., 2019. Analysis of Short Term Financial Performance: A Case
Study of an Energy Service Provider. Journal of Accounting Research, Organization
and Economics, 2(2), pp.113-122.
Shaw, F. and Donovan, C., 2019. Assessing the Preparedness of Major Oil and Gas Companies
for a Low-Carbon Energy Transition. Available at SSRN 3339853.
Szum, K. and Nazarko, J., 2020. Exploring the determinants of Industry 4.0 development using
an extended SWOT analysis: A regional study. Energies, 13(22), p.5972.
Tsangas, et.al 2018, March. Cyprus energy resources and their potential to increase
sustainability. In 2018 9th International Renewable Energy Congress (IREC) (pp. 1-7).
IEEE.
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Xu, X.L. and Liu, C.K., 2019. How to keep renewable energy enterprises to reach economic
sustainable performance: from the views of intellectual capital and life cycle. Energy,
Sustainability and Society, 9(1), pp.1-10.
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