Analysis of Logistics and Supply Chain Management at British Petroleum

This report analyzes British Petroleum's logistics and supply chain management, focusing on its strategies for the global oil and gas market. It explores the relationship between e-business and e-commerce, highlighting innovations and their benefits to BP, such as mobile commerce and data-driven marketing. The report also examines best practices in the industry, including supply chain management and cost reduction strategies. It discusses the importance of efficiency, supplier relationships, and the integration of e-commerce to enhance BP's performance. The report provides insights into how BP can leverage these practices to maintain a competitive edge in the dynamic business environment.

Running Head: Logistics and Supply Chain Management
British Petroleum
Logistics and Supply Chain Management

Logistics and Supply Chain Management 1
Table of Contents
Introduction......................................................................................................................................2
A. Logistics Management................................................................................................................3
Introduction of Organization........................................................................................................3
Logistics management..................................................................................................................3
Efficiency of Logistics management............................................................................................4
B. Relationship between e-business and e-commerce.....................................................................6
E-commerce.................................................................................................................................6
E-business....................................................................................................................................6
Link between e-commerce and e-business...................................................................................6
Recent innovations in e-business and e-commerce......................................................................7
Benefits to British Petroleum through recent developments and innovations in e-business and
e-commerce..................................................................................................................................7
C. Range of best practices.............................................................................................................10
Best Practices.............................................................................................................................10
Range of different best practices................................................................................................10
Benefits of best practices to the organization............................................................................10
Conclusion.....................................................................................................................................13
References......................................................................................................................................14

Logistics and Supply Chain Management 2
Introduction
Under this report, British Petroleum’s logistic management strategies will be covered and along
with this, their strategies’ effectiveness will also be covered with the view to attain the
competitive advantage in the international petroleum market. Under this report, relationship
between the e-business and the e-commerce will be discussed and along with this, benefits
attained from the recent developments and the innovations made in the e-commerce will be
discussed.

Logistics and Supply Chain Management 3
A. Logistics Management
Introduction of Organization
British Petroleum is a multinational company engaged in the production and the distribution of
oil and gas across the global market. British Petroleum’s logistic management involves the
activities of managing their goods and services in such a manner under which all their local as
well as international clients’ demand could be fulfilled. BP P.L.C distributes its products
amongst the 72 countries across the globe and their average production of oil is near to 3.3
million barrels. Logistics and supply chain management process involves the supply, control and
manage of the raw materials to be used by one company and the transfer of those materials to the
other business enterprise for making the finished goods. With the effective logistic management
process, organization will be able to compete in the dynamic business environment easily.
Logistics management
Logistic management is the component of supply chain management and it includes the plans,
methods and the implementation techniques for improving the flow of goods and the services. It
also maintains the flow of information from the origin to the consumption point in order to
enhance the customer satisfaction level.
Supply chain management is the process of the delivering the raw materials, information,
products, and services to other business organizations for making the finished goods, to
customers for the consumption purpose. British Petroleum is involved in both the processes i.e.
upstream as well downstream activities of business. Logistics and supply chain management
process includes various departments such as marketing, production and distribution. Under this

Logistics and Supply Chain Management 4
process, customer’s demands needs to be fulfilled on priority basis because they plays crucial
role in the success of the organization. As British Petroleum is involved in both upstream as well
as downstream activities, they will be counted in the B2B type of business organizations. This is
because they do not directly deal with the customers, they supply oil and gas products to
distributors and wholesalers and then they distribute the same to the customers (Ahi & Searcy,
2013).
Efficiency of Logistics management
British Petroleum is engaged in the distribution of oil and gas products through offline mediums
but with the introduction of the online mediums, organization will be able to enhance their
revenues through selling their products with an extra channel. Today, online shopping is more
preferred as comparing with the offline shopping modes because it allows the customers to
purchase as per their requirements as well as it has various other benefits such as effective return
facilities, etc. British Petroleum could be able to take orders for the supply of oil and gas through
e-commerce mediums and along with this, it also enhances the expansion opportunities for the
organization (Fawcett, et. al., 2011).
E-commerce and e-business are the terms used to describe the trading activities over the internet.
These are new terms which are used for enhancing the efficiency of the logistics management
proves. Apart from this, supply chain management and the customer relationship management
also gets improved with the help of advanced techniques of trading. Recent developments and
innovations made in the e-business term have enhanced its efficiency as well as effectiveness.
Following are some of the innovations made in the e-business activities through which British

Logistics and Supply Chain Management 5
Petroleum could enhance its revenues as well as its expansion opportunities in the other countries
across the globe
Generally, distribution network of business enterprise is known as the supply chain management
process but both processes are quite different from each other. The main motive of distribution
network is to deliver the products and the services manufactured by the organization to the
customers for fulfilling their needs. While supply chain management’s main motive is to perform
all the activities of the distribution network and along with this, this also consist the development
of customer relationship management for retaining the customers for long run (Balocco, Perego
& Perotti, 2010).

Logistics and Supply Chain Management 6
B. Relationship between e-business and e-commerce
E-commerce
E-commerce is a term used to denote the purchase and sale transactions done on the internet
platform. There are many other activities which are executed under the term e-commerce such as
mobile commerce, instant money transfer, internet banking activities, etc. Online Shopping
websites are the part of e-commerce industry.
E-business
E-business is the activity of purchasing and selling over the internet platforms. Any kind of
trading activity executed over the internet platform will be counted as the e-business activity. In
traditional times, people used to go to the markets for purchasing and selling the products as per
their needs. While today, these activities can be performed over the small wireless device
without devoting much time to go to the markets especially.
Link between e-commerce and e-business
Digital mediums have developed their separate image in the business environment effectively
and with the effect to this, various companies have adopted this strategy with the view to expand
their business in the domestic as well as in international markets. With the introduction of digital
mediums of trading, market share of the physical market have been reduced rapidly. Offline
markets have also adopted the medium of e-commerce trading activities in order to attain their
goals and the objectives.

Logistics and Supply Chain Management 7
Concepts of e-marketing are quite unique and every organization needs to perform their activities
in an appropriate manner with regards to the e-commerce activities in order to attain its
objectives in the same field. Disruptive use of these concepts could result in barriers for the
organization. E-marketing and internet marketing are two different sides of a coin. E-marketing
concept is a broader concept whereas internet marketing includes spreading awareness regarding
the organization’s products through websites, email, wireless media, etc. While e-marketing
activities includes a broad concept under which all the activities of internet marketing are
included and along with these activities, major concept i.e. customer relationship management
system is also being included. With the help of these concepts, British Petroleum will be able to
commence its trading activities through e-commerce mediums which will lead them for attaining
their goals and the objectives.
Recent innovations in e-business and e-commerce
E-commerce is the activity which defines the delivery of information, products, and services to
the consumers over the telephone, internet mediums, etc. with the motive of earning certain
amount of profits. E-business is a broader term than e-commerce because it also consist the
activities of providing after sale services to the consumers along with the buying and the selling
activities. E-business activities majorly performed for developing and for maintaining the
customer relationship management (Christopher, 2016).
Benefits to British Petroleum through recent developments and innovations in e-business
and e-commerce
 Multichannel Approach: In traditional times, trading activities were used to be
conducted through offline sources only i.e. selling and buying of products in the physical

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markets. Consumers were used to go in the markets for purchasing and consuming the
products and services as per their needs and requirements. But after introduction of the e-
business and e-commerce, opportunities for expansion have been increased rapidly.
 Mobile Commerce: It leads to the enhancement of the portable devices and the internet
facilities in those devices. Mobile phone, tablets, laptop, are some of the examples for
mobile commerce devices. Mobile internet users have also been increased with the
increase in the mobile commerce. With the effect to this, various organizations have
doubled their revenues through selling their products and services on both the platforms
i.e. online as well as offline. Usage of mobile phones, tablets has been increased in the
last years and these are the major sources through which online orders are being placed.
In order to attain the growth and benefit of these devices, British Petroleum needs to
launch their websites and appropriate digital media tools should be used in terms of
promotion of the organizational websites and other e-business mediums (Gil, et. al.,
2010).
 Data Driven and Personalization Marketing: This innovation is made on the basis of
increasing and unique demands of the consumers. Under this strategy, consumers are
asked to provide reviews and feedbacks in relation with the products and the services
offered to them. On the basis of their reviews and feedbacks, organization develops or
alters their existing products and services in order to fulfil their needs. This helps them to
attain the highest level of satisfaction from the consumption of the products and the
services. Along with the consumers, it builds up trust level amongst the consumers
towards the company which helps the organization to survive effectively in the
competitive and dynamic business environment. Under this strategy, customers are

Logistics and Supply Chain Management 9
targeted and segmented on their requirements basis and then appropriate and effective
products and designed and delivered to the consumers for the purpose of attaining the
goals such as customer satisfaction, increase in the revenues, etc. (Lambert &
Schwieterman, 2012).

Logistics and Supply Chain Management 10
C. Range of best practices
Best Practices
Best practice is the standard performance which needs to be attained from the perception of
attainment of organizational goals and the objectives. This practice is considered as the top
performance and for every task; there will be a best practice. This also motivates the performers
to attain to the level of the best practice.
Range of different best practices
British Petroleum is included in the business to business type of trading activities, they extracts
the oil and gas from the core sources and then reforms them as the finished products. These are
delivered to the consumers with the help of distributors and the wholesalers. In order to perform
the activities, supplier relationship needs to be developed for providing the products to the
consumers within the time as well as to fulfil their needs. Following are some of the benefits
which could be attained from the implementation of strategies in e-business and e-commerce
industries:
Maintaining good supply chain management relationship plays crucial role in attaining desired
goals and the objectives for the organization. British Petroleum has the effective supply chain
management techniques and strategies which are also organization’s strengths and it helps the
organization to develop its separate image in the oil and gas industry (Leonard, 2012).

Logistics and Supply Chain Management 11
Benefits of best practices to the organization
 Decreased Cost: For decreasing cost of the production, organization have various ways
such as changing supplier, reducing profit margins, cutting unnecessary costs, etc. But all
these techniques could generate negative results for the organization and in order to attain
the effective results, targets set up by the management, organization needs to adopt the
most adequate and effective strategies. For instance, British Petroleum moves towards the
new supplier of workers and raw materials used for extraction purposes. This decision
could generate positive as well as negative outcomes for the organization because it is not
necessary that organization will get the same benefits as per the previous suppliers.
Hence, it very necessary to enquire about the results and effectiveness before adopting
strategy for enhancing the growth opportunities for the organization (Meng, 2012).
 Efficiency: British Petroleum will get adequate benefits from the adaptation of e-
business activities. While to perform the activities of the e-business in an appropriate
manner, organization needs to perform certain functionalities i.e. maintaining good and
effective customer as well as suppler relationship. This will help them to generate
positive outcomes which will enhance the chances of the growth and the opportunities in
the international market.
 Reduce Price Changing: Adaptation of e-business and e-commerce activities will lead
to the reduction in the prices of the products. This will lead to enhancement in the
demand of the products at certain level. This is due to avoidance of the distributors and
the suppliers from the process and customers will be able to get the products on priority
basis. Apart from this, regular shifting of suppliers could also affect the demand of the
products because it may affect the quality as well as the effectiveness of the products.