Comprehensive Business Strategy Analysis Report: BP Oil Company

This report provides a comprehensive business strategy analysis of BP Oil Company. It begins with an introduction to business strategy and its importance, followed by an overview of BP Oil Company. The report then delves into the strategic planning process, including goal-setting, analysis, strategy formation, implementation, and monitoring. It examines the macro-environmental factors affecting BP, such as political, economic, social, technological, legal, and environmental factors, along with a SWOT analysis. The report also explores the internal environment and capabilities of BP, including its internal capabilities and applying the McKinsey 7-S model. Finally, stakeholder analysis is used to identify key stakeholders. The report uses models, theories, and concepts to interpret the strategic directions available to the organization.

Business strategy

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
TASK 2............................................................................................................................................6
TASK 3 .........................................................................................................................................10
TASK 4 .........................................................................................................................................12
REFERENCES..............................................................................................................................16

INTRODUCTION
Business strategy is a combination of the all actions performed and decision taken by the
organisation for accomplishing the goals of the business and also secure the competitive
positions in the market. It is support and backbone of the business as the roadmap and leads to
the desired goals (Scholes, 2015). BP oil company is a multinational British petroleum, oil and
gas company in UK. It is one of the largest seven gas and oil super majors and also with the 12th
largest revenue. This report will study the impact and influence of the macro environment factors
of the organisation and business strategies and it also describes the internal environment and
capabilities of the organisation. Furthermore, this report will discuss the outcomes of the analysis
by using the models in the market sector and also applying models, theories and concepts with
the understanding and interpretation of strategic directions available to the organisation.
The overview of the study has been described the different strategies of the business and
also it also support and backbone of the business for making competitive positions in the market.
TASK 1
Strategy
It is a process which is an plan high level of action design for achieving the long term
and overall aim. Strategy is important because when all the resources are available for achieving
the goals of BP oil company then the resources are usually limited. It generally involves the
setting of the goals, determining the actions, mobilising the resources for executing the actions.
The role of strategy and different strategic direction.
The role of the strategy is important because it deal with the specific strategies where it is
necessary to increase the odds of the success. It is important that business strategy which seeks
and hire the outside consultants for assisting the carrying out and forming of the strategies and on
the other hand the strategic direction which has been included the central forces which propel the
business towards the intended goals and objectives. It has been involved the mission. Vision,
tactics, strategies and core main values for the establishments of the direction which gives a way
and path for ruining the business. The main role of the business strategy has provided the plan of
the operation function which has been performed and company can use best for it. It aligned with
the company and also help in achieving the long term plans and strategies of the company.
Strategic planning formulation

Goal-setting:- It is one of the most important purpose of strategic planning where it
clarify the vision and goal of the BP oil company this strategic planning techniques has been
identifying the key facts that defines both short and long objectives, identify the process of
accomplish the objectives, customize the process of staff and asgin a task to each for achieving
the task and goals of BP oil company(Sia, Soh and Weill, 2016).
Analysis:- It is one of the key stage where all the information and details has been
gathered and then shape for the next two stages. In this it gather the relevant data and
information which accomplish the vision of the BP oil company. The main focus of the analysing
is to understanding the needs, strategic direction, initiatives which help in growing of the BP oil
company and it also illustrate the issues which affect the goals of the business and identify the
strength, weakness, threat, opportunity which arises along in the path.
Strategy formation:- Informing the strategy is it review the information which cleaned
for completing the analysis. it determine the resources which currently help in reaching and
defining the goals. The problems faced by the BP oil company has been prioritised by their
importance to the success. When the prioritised has been formulated according to the strategy
then the economic situations are fluid and also the critical stages has been developed the
alternative approaches which target the each step of plan.
Strategy implementation:- Successful implementation of the strategies is the success of
the business ventures. It is an type of the action stage when the overall strategy does not working
with the current structure of BP oil company. When the resources and funding are available for
the ventures and securing the points then employees are ready for executing the plans of BP oil
company.
Strategy monitoring:- Strategy control and evaluation involves the management of the
performance and also consistent of reviewing the external and internal problems and also make
the correct actions when it is necessary(Akter and et.al., 2016).
Macro environment of the organisation.
It is a framework of the tools which has been used for monitoring and analysing the macro
enviornmental factors of teh BP oil and gas company which may profound the impact of
performance of teh organisation.
Political factor:- Political factor has been involve the trading policies, lobbying,
relations of inter-countries and so on. For achieving the success and growth in the dynamic oil

industry across so many countries is only to diversify the risk of the political environment. Its
important to have the political stability in the environment of the BP oil company because from
instability it increases the level of corruption in the level of regulation of the oil sector. The
positive impact of the political environment is it provide intellectual property protection and also
favoured the trading partners which is beneficial in the stability of the political factor and on the
other hand the negative impact is it increases the tax rates, pricing regulations on oil, wages
legislation when the government changes this all effect the BP oil company. The positive impact
of this factor is when the political environment is stable then it does not change the environment
in the other hand the negative impact is when the tax rate is increases then it affect the revenues
of the company.
Economic factor:- It involves all the inflation rates, interest rates, saving rates, foreign
exchange rate and also the economic cycle for determine the aggregate demands and investment
in the economy of the BP oil company. The competition norms of economic environment factor
impact the competitive advantages of the BP oil company. The organisation has been used
country's economic factors such as inflation rates, growth rates and the economic indicators etc.
The positive impact which affect the decision making of the company is exchange rates and
stability in the host country capital, unemployment rate, education level of the economy and the
negative impact of economic factor is the intervention of the government, the quality of the
infrastructure affect the BP oil company the positive impact improved quality of life due to
economic growth, these gains have not been even, and economic growth usually has negative
economic consequences. of natural disasters and other economic risks of the BP oil
company(Thompson, Strickland and Gamble, 2015).
Social factor:- its important for BP oil company to understand the culture of the society,
attitudes, beliefs of the population which plays a vital role in the market because BP oil company
has to understand the consumers of the given market and has to design the message of the market
for oil company customers. The positive impact of the social factor on the decision making
process of the BP oil company is it learn new thing and participate in the society's culture
according to the new changes which gives them proper details and information about the oil and
gas usefulness and harm to the customers in the market and on the other hand the negative
impact is changes in the attitudes and social culture according to time. The positive impact of the

social factor is it adopted the new advance technology and on the other hand negative aspect is it
bring so many changes which is not affordable by the company.
Technological factor:- This factor is very fast disputing factor for the industry where its
important to bring the technological analysis and also speed up the technology disrupts with the
industry. From accepting the new development of the technology it speed up the work and also
make the firm profitable and it also gives a tough competition in the market. The negative
impact of the technological factor on the decision making process is it takes huge time and cost
for accepting the new changes and also the positive impact is it lower the burden of work of
employees and worker and increased the profitability. The positive impact of the technological
factor it lower the burden of work of the employees and on the other hand the negative impact it
it time consuming and take huge cost.
Legal factor:- the framework of the legal factors and also the institutions is not enough
for protecting the rights of intellectual property and helps in entering in the new market. The
positive impact on BP oil company is provide the copyright, patents, data protection fro the
industry and also the negative impact new rule and polices has been made by new government.
The positive impact of the legal factor is all the work has been done according to the legal laws.
on the other hand the negative factor is it affect the transportation and legal authorities of the BP
oil company.
Environmental factor:- its necessary to make the norms according to the standards of
the environment which affect the profitability of the BP oil company. Its important to run the
company according to the laws and liability towards the environment. The negative impact is it
affects when changes comes in the weather and climate which affect the working process of the
company and also the positive impact is it from making the Eco-friendly oil and gas it does not
harm the climate and recycle the oil of the company for resuse.(Higgins, Omer and Phillips,
2015).
SWOT analysis

SWOT BP oil company
Strength It has strong operational performance.
It uses the developed technology.
Weakness The weakness of the company is the oil spills
and it is so much near to the accident in the
industry while working.
Opportunity It has potential growth and success for the new
task and projects.
Day by day growing the demand of the energy.
Threats Threat of the company it is responsible for the
global emissions and also have the concern of
the cyber security.
Stakeholder analysis
It is an one of the important technique for analysis and identification for stakeholders
needs. Stakeholders has the vested interest in the problems with the task which has been
concerned. It is a type of process for assessing the systems and potential changes which has been
relevant to the interest parties. The information which has been used for assessing the interest of
the stakeholders has been addressed in the planing process and also the issues has been
consisting the weighing and balancing the competing demands.
TASK 2
Internal environment: - Internal environment of the BP oil company has been composed the
elements within the firm. It involves the current employees, corporate culture, management and
employer behaviour.
Internal capabilities:- it is generally based on the strategies, motion of the internal resources
and also the core competencies of the BP oil company which derived the distinctive capabilities
for providing the strategic platform and underline the long term profitability.
McKinsey’s 7'S models

This are the hard elements of the model.
Strategy:- It is an plan which deployed by the BP oil company in order to remain
competitive in the market and industry. It is an ideal approach for establishing the long term
strategy and also aligns with the other elements of the models. It also communicate clearly with
the BP oil company about the goals and objectives(Pisano, 2015).
Structure:- The structure of the BP oil company has been made according to the
corporate hierarchy, command of chain and also divisional make-up which outlines the
operational functions and also the interconnect. It easily effect the details of the management
configurations. It provide the details about the responsibility of the workers of the BP oil
company.
Systems:- BP oil company system refers to the workflow, process, procedure and also
the decision which make up the standard of the operations within the BP oil company. System is
Illustration 1: The McKinsey 7's Model
(Source: The McKinsey 7's Model 2018)

a word where manager spend their vast majority and find out the details that all the workers and
employees are working on the right project or not, work completing on time, it is important to
have the function which runs all the functions properly(Hsieh, Ma, and Novoselov, 2019).
This are the soft elements.
Shared Values:- It has been commonly accepted the norms and standards within the BP
oil company which temper and influence the behaviour of the entire management and staff. It has
been given on the guidelines of the company which has been presented to the staff. It is basically
related to the actual accepted behaviours within the workplace.
Style:- Style is all about management and leadership styles. It has been understand the
leadership styles which should fall in line both the culture and needs of the organisation and
team of the BP oil company. There are different leadership styles which employed by manager
depending on the situations and needs to craft the approaches of the job which has been best fit
on the circumstances around organisation.
Skills:- It always comprises with the capabilities and talents of the management and staff
of the BP oil company and it can determine the work and achievements the organisation has been
accomplish. When time changes it assess the available skills and always divide to change the
skills according to the goals set for its strategy.(Hayashi, Kitamura, Nagasawa, and Suga,
2019).
Staff:- The word staff refers to the personnel of the BP oil company such as how large
the workforce is, motivations resides, training and also the employees are prepare for the task
before set them for employees by the BP oil company. Its necessary to understand the strength
and weakness of the team organisation because never want to ask someone in the team that have
not capable of. So, its important to understanding the talent and skills along way. From good
leadership and leader always improve the talents and skills of the team within the staff and that
should be priorities.
VRIO framework tool for analysing
It is an business analysis framework which forms the part of the BP oil company strategic
scheme. There are some points which has been described below;

Value:- Its necessary that resources are valuable because when the resources seen as
valuable which enable the BP oil company implement the strategies which improves the
effectiveness and efficiency by exploiting the opportunities and mitigating the threats(Amran,
Ooi, Wong and Hashim, 2016).
Rarity:- The second framework of the model is the resources must be rare and also the
resources which has been required by BP oil company. If a particular valuable resources has
been possessed by the large amount of the player in the company. The situation has been
indicated as the competitive equality and competitive party. In this case the BP oil company
posses the large amount of resources which has been rare and valuable and it is likely the least
temporary competitive advantages.
Inimitable:- It is very difficult to imitate and there is also so many significance cost of
the disadvantages to the BP oil company which trying to obtain. It duplicate and develop the
resources and its capabilities.
Organisation:- The BP oil company has been coordinate and assemble the resources
effectively. Organisation has been acquire , monitor and use the resources which has been
Illustration 2: VRIO Firm resources to competitive advantage
(Source: VRIO Firm resources to competitive advantage 2018)

involve, even the organisation be valuable, imperfectly and rare with the limited resources is not
able to create the sustainable advantages for the BP oil company.
TASK 3
Porters five force analysis
Attractiveness:- A term used to describe interesting profit possibilities one may obtain by
investing in an available market and/or industry. The better a market's attractiveness, the greater
the potential profits to be had by investing in that market.
Competition In The Industry:- it refers to the number of competitors and also the
ability to undercut the organisation. There are many large numbers of the competitors which
along with the equivalent products and services which has been offer. buyer and suppliers of the
company seeks out to the competition of the BP oil company which is able to offer the best deal
in lower prices because organisation has the greater power to charge highly pricing and also
deals with the higher achieve of profits and sales of the BP oil company (Hsieh, Ma and
Novoselov, 2019).
Potential of New Entrants Into Industry:- The power of the BP oil company has been
affected by the forces of the new entrants into the market. Less the money and time it only cost
for the competitor for entering into company's market and has been a effective competitor more
then the position of the company which significantly weakened. BP oil company has the strong
barriers which entry has the attractive features which allows to negotiate the better terms and
charge higher rates.
Power of Customers:-It is an specifically deal with the abilities where customers has to
drive the prices down and it has been affect the buyer or consumers of the BP oil company which
has significance for each and every customers. Customers has the power of bargaining which has
been described the outputs of the market. It has been included so many things such as the
availability of the existing oil, the switching cost of buyer, leverage of bargaining and so on.
Power of Suppliers:- There is bargaining power of the suppliers where supplier has to
supply the raw materials, labour, components and services to the BP oil company which has the
source of power and there are few substitute. It involves the switching cost which is relative to
the cost, impact on the cost of inputs and differentiation, strength of the distribution channels of
the BP oil company.

Threat of Substitute Products:- Substitute products uses the different technologies
which try to solve the economic needs. Substitute products and services has been used in the
place of companies oils and services where it produce the oil and gas from which there is no
more close substitute which has the more power to increase the price and also the lock of the
favourable terms in the BP oil company.
There are some competitive strategies which has been combined with the scope of all the
activities such as when the BP oil company enter into new market for becoming more
challenging for the competitors and meeting all the demands of the stakeholders. When it enter
into new market there are so many strategies which has been expected by the BP oil company
such as the marketing strategy where it advertise the oil and gas of their company for increasing
the sales and it also comes with the product development where it provided the better quality of
oil and so many new gas which is running in the market and the opportunity has been taken by
the BP oil company where it develop there product and launch it into new market. Where it has
to raise the share of market and also offers so many variety of oils and gas which has been offer
in so many market segments which has been targeted by the BP oil company for increasing the
sales and productivity of the oils and gas(González-Rodríguez and et.al., 2018).
Ansoff matrix
Existing products New products
Existing market Market penetration
It has been achieve the growth
through offering the better
quality of oil and gas to the
new market.
Product development
it has been accepting the new
opportunities for both the oil
and gas and the market is new
to the industry.
New markets Market development
it raise the market share
through the growth and also
offers the current oil and gas to
the market segments.
Diversification
it develop new products for
replacing or complement the
current offers which target the
existing segments of the
market.