Strategic Analysis and Planning for British Petroleum Oil Company

This report provides a comprehensive analysis of British Petroleum (BP) Oil's business strategy. It begins with an introduction to business strategy and its application to BP, followed by an examination of the macro environment, including political, economic, social, and technological factors, and their impact on the company's strategic decisions. The report then delves into BP's internal environment, capabilities, and the application of frameworks like SWOT and PEST analysis. It also explores the company's strategic direction, vision, mission, and the role of strategic planning techniques. Furthermore, the report evaluates the competitive forces within the oil and gas industry and proposes strategies to improve BP's market position. The analysis includes the application of various strategic models and concludes with a strategic management plan, offering tangible priorities and objectives for the company. This report is contributed by a student and available on Desklib.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1Applying appropriate frameworks impact and influence of macro environment and its
strategy........................................................................................................................................3
D1 Critique and interpretation of data to produce set of valid strategic directions....................8
TASK 2..........................................................................................................................................11
P2 Internal environment and capabilities of an organisation...................................................11
M2 Critical analysis of McKinsey's 7 model...........................................................................13
TASK 3..........................................................................................................................................14
P3 Evaluating competitive forces of a given marketplace of an organisation..........................14
M3 Appropriate strategies to improve competitive edge and market position.........................14
TASK 4..........................................................................................................................................15
P4 Applying theories and models to devise strategic planning for an organisation.................15
M4 Strategic management plan.................................................................................................16
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
In today's context business strategy can be determined as a course of action or decision
which assist entrepreneur in gaining specific business objectives. It is a plan that management use
to secure a competitive position in market as on to carry operations and achieve desired ends of
business (Brewster, 2017). In this report the organisation chosen is British Petroleum Ltd, a
British multinational oil and gas company headquartered in London. It is one of the world's seven
oil and gas company worldwide. This report is going to analyses impact and influences of macro
environment and its strategies as well as its internal environment and capabilities of an respective
organisation. Moreover, applying Porter's Five Forces to identify its competitive position and
providing recommendation based on outcomes. Furthermore, applying models and theories to
assist understanding and interpretation of strategic which is useful for an organisation.
Additionally, producing a strategic management plan that has tangible and tactical strategic
priorities and objectives of respective company. Hence for such purpose CEO of British
Petroleum has appointed junior manager in solving problem that has been faced within an
organisation.
TASK 1
P1Applying appropriate frameworks impact and influence of macro environment and its strategy
A business strategy is set of competitive moves and actions that business uses to attract
customers, strengthening performance and achieving organisational goals and objectives. It is
basically set out to achieve desired goals and objectives in an attractive manner. Additionally, it
can be described as a long term business planning process and mainly concerned with scope of
business activities.
Strategy: In organisation context, strategy is a framework that usually provide direction and
scope for an organisation over longer period of time which help in achieving advantage through
configuration of resources within a challenging environment. A strategy is all about integrating
organisational activities and utilizing as well as allocating scare resources within organisational
environment as to meet up organisation goals and objectives. Moreover, while planning strategy
it is essential to consider that all the decision are taken to meet up the need and demand of
customers as per their preferences. Moreover, within an organisation strategy is a blue print that
defines organisation goals and objectives, reduces key policies and plans for achieving those

goals in a most appropriate manner. Thus, it can be said that strategy deals with long term
development rather than routine operations as it consist of probability of innovations such as new
product, new methods or market to develop for future aspect.
Role of strategy to achieve business objectives and goals
In an organisation context strategy play's many different role within workplace. Herein,
mangers of BP oil are adopting different role of strategies in achieving organisational goals and
objectives. The role of strategy are determined below:
Framework and operational planning: In an organisation, strategy provides a
framework that usually plans in operating at challenging environment (Burlton, 2015). If
strategies are developed and carefully understand by the mangers of BP oil so that a consistence
can be maintain in operating their day to day business activities and function. Moreover, by
maintaining an equivalent consistence in strategies than resources are utilised at maximum level
and an organisation will able to achieve its goals and objectives in an efficient manner. Thus, in
this an organisation will able to attain sustainability for longer duration of time.
Clarity in direction of activities: Within organisation strategy usually focus on direction
of activities that are need to be undertaken in achieving goals and objectives of an organisation.
In this role of strategy mangers of BP oil must ensure that they are clear about their
organisational objectives in more clear and specific manner. Moreover, if strategies are spelt out
in an effective manner that it become clear to direct a person in an organisation who is
responsible for implementing various courses of action. Thus, strategies most focus on
operational activities and make them more practical in nature.
Increase organisational effectiveness: In an organisation strategies determines
organisational effectiveness in different ways. Strategies usually bring effectiveness within
organisational activities by properly utilising resources in best and effective manner in order to
bring efficiency which ensure maximum contribution towards organisational activities.
Moreover, mangers of BP oil need to take strategic management decision which states that
objectives of an organisation can be achieved in given context of resources.
Personal Satisfaction: In today's context an organisational strategies also contributes
towards organisation effectiveness by providing personnel satisfaction too. In many organisation
a formal strategic management process is followed with this process people are more define
towards roles and responsibilities by reducing conflicts and ambiguity. Moreover, the mangers of

BP oil need to take decision in an systematic manner so that everybody knows how to contribute
towards organisational objectives.
Strategic intent: Strategic intent defines idea of an organisation that desire to attain in
future. It indicate long term market position of an organisation in order to create and desire of
opportunities for exploring new responsibilities. The strategic intent of BP oil is to recognised as
a great petroleum company that is competitively successful in competitive marketplace of same
industry line.
Different strategic direction
Strategic action is a course of action that leads to achievement of goals of an organisation
(Chang, 2016). It is one of the important force in an business as it established a structure for
internal responsibilities that each department carry out in an appropriate manner. Moreover, it
clearly identifies mission, vision, objectives and strategies that defines core value in
establishment of strategic direction.
Vision: The vision of B P oil to have best competitive corporate in same business line as
well as to become assessable, inclusive and diverse.
Mission: Its mission is to bring integrity, honesty dealing with dignity and striving for
mutual advantage as well as working towards human progress.
Strategies: The strategy direction of BP oil is to become more abundant and less costly in
their product and services. They are adopting new technologies that will produce more efficiency
in several ways as well as help to meet up expect rise of demand in competitive advantage.
Issue: Moreover, respective company was facing problems in meeting demands of
stakeholders and its result to loss key workers and it tremendously effected profitability of their
performance in competitive marketplace.
For such instance, mangers of BP oil have cost of leadership model in order to regain their
competitiveness in marketplace. With application of this method they are able to create low cost
of operation within market. This strategy is primarily adopted by the mangers in order to gain an
advantage over competitors by reducing operational cost in same industry. Moreover, this
strategy adopted as it allows them to remain competitive in time when policies, technologies and
customer's preference are evolving. Moreover, BP oil mangers believes in an balanced portfolio
in order to remain competitive in marketplace as well as sustainability for longer period of time.
Identifying and explaining different strategic planning techniques

In an organisation strategic planning is basically a management activities that are adopted
to set out priorities, focus on energy and resource, employees and stakeholder work towards
achieving common (Chenand and Jermias2014).There are different strategic planning techniques
such as VMOST, PEST, SWOT, SOAR and Porter's Five forces. Herein, the mangers of BP oil
are adopting SWOT and PEST analysis in order to best strategic planning that help in achieving
goals and objectives of an organisation in an effective manner.
PEST analysis:
PEST analysis is adopted by an organisation as measure or assess marketplace for their
product at a given time frame. Herein mangers of BP oil are adopting this tool in drawing out
proper strategic planning which is essential for an organisation for longer duration of time.
SWOT analysis:
In an organisation play's an essential role as it help to determine evaluate competitive
position of a particular organisation by identifying an organisation strengths, weakness,
opportunities and threats. Moreover, BP oil are using SWOT analysis in order to have most
strategic planning for their business operation. Herein, the mangers need to identify its strengths,
weakness, opportunities and threats so that an appropriate decision can be adopted which is
important for an organisation to attain sustainability in same industry line. Moreover, strengths
will help mangers to are described their unique feature from its competitors as well as
understanding their consumer depth by catering all their energy needs. Additionally, weakness
will help managers to take decision for those are where they are lacking behind or such areas that
are need to be focused more so that better result can be outputted. Moreover, determining
opportunities that creates avenues in competitive environment that are surround by business
capitalize to increase profitability in competitive marketplace. Furthermore, analysing threats
that usually harm an organisation due to increase in competition. Hence with Swot analysis an
organisation will able to have an effective strategic planning so that appropriate decision can be
taken.
The above mention are tools and techniques that are adopted by mangers of BP oil in
developing an appropriate strategic planning that is beneficial for an organisation to attain
sustainability for longer period of time.
M1 Critically analysis of macro environment to determine strategic management decision
Macro environment analysis:

For the effective analysis of macro factors, BP oil requires to analysing political,
economical, social and technological factors keenly in order to appropriate and flexible planning.
Political factor plays a vital role as it help determining factors that impact BP oil long term
profitability in operating country or marketplace (Chu, Kumar and Khosla, 2014). These factor
need to analysis adversely before enter into marketplace. Moreover, Economic factors impact on
inflation rate, interest rate, foreign exchange rate and economic cycle that determine aggregate
demands in marketplace. Furthermore, social and technological factors are advancing with rapid
growth. For such instance, mangers of BP oil need to analysis technological factor but also
overcome with technologies that need to speed their productivity and profitability.
SWOT analysis of BP oil and its affects in management decision.
Swot analysis is a framework that is used to evaluate a company's competitive position
by identifying an organisation strengths, weakness, opportunities and threats. Moreover, BP oil
are using SWOT analysis in order to have most strategic planning for their business operation.
Strength: Strength describe what an organisation excels and what separate it from its competitor
such as a strong brand, loyal customer's in competitive mark place.
(Xingang,and Bei, 2013). In an organisation strengths are described as unique feature an
organisation have that separates it from its competitors. BP oil have some strong strengths such
as:  BP oil has diversified into number of areas such as lubricants, energy, aviation fuel and
information technology. It have loyal customer's especially in oil business which have
high loyal bard in marketplace as well as attain global leadership and play's a critical role
in maintaining an economic balance in region. Moreover, this will help management to
take effective decision so that they can more efforts to make an attractive brand in
competitive marketplace. Thus, for such instance they need to understand their consumer
depth by catering all their energy needs.
Weakness: Weakness refers an organisation to stop performing at its optimum level. It usually
determine where an business need to improve to remain competitive in marketplace (C.
andFragkos2013). In an organisation weakness are refer to those area where an organisation need
to do improvements. Herein, some of the areas that BP oil need to make improve are as follows:
 BP oil have faced controversies such as they have undergone many scandals which have
effected sustainability rating that affected goodwill. Moreover, they have faced ethical

issues such as dishonest transactional issues which lead to create negative image in
society. Additionally, mangers of PB oil was not able to penetrate successful in non
energy markets due to low energy related domains. Herein, mangers need to make strong
planning and tactics so that they can overcome their weak areas in an effective manner.
For such purpose they need to monitor their areas so that appropriate strategic planning
can be done.
Opportunities: Opportunities are advancement that usually creates avenues in environment that
are surround by business capitalize to increase profitability in competitive marketplace
(Coleman2012). Herein, the mangers of B P oil are garbing to some extent to attain opportunities
in competitive marketplace.
 BP oil are garbing opportunities as they are expanding their business operation in many
other countries and nation. This lead to create increase in hunt for huge resources and
demand. Moreover, increase in production of motor vehicle in different parts of country
will ultimately increase demand and supply. Furthermore, it will raise opportunities for
respective organisation to quest for resources and increase production as well as price
too. Thus, needs to create such management plans and procedures so that effective
opportunities can be adopted in proper time without any deal in it.
Threats: Threats refers to those factor that have potential harm within an organisation
(Wheelen, 2017). Herein, BP oil are facing some threats that effected by some factors are:
 Increased in environmental regulation will majorly imposed pressure on organisation to
design eco friendly products which increase the production cost and lower down profit
margin. Moreover, emergence of new companies and rivalry among existing market that
increase competition and fluctuate profit margins. Herein , mangers of organisation need
to have strong management plans and policies so that they can over such threats in
competitive marketplace. Additionally, this is need so that a respective organisation can
be harmed in any way.
D1 Critique and interpretation of data to produce set of valid strategic directions
PEST analysis:
Political factors: As per the view point of Athanasios Pitatzis, Political factor is usually
determined to extent in which government may influence economy or a certain industry (PEST
Analysis for global oil and gas companies operations, 2017). Herein, political factors plays a

significant role determining that factors that impact BP oil long term profitability in operating
country or marketplace(Eaton and Kilby, 2015). The mangers are keenly examining different
factors before entering or investing into competitive market such as: BP oil are facing government interference, bureaucracy and legal framework of contract
agreements that are usually enforced by government. Moreover, government of other
nation are encouraging to choose more sustainable energy forms because of climate
destabilization forms of Carbon dioxide. Moreover, BP oil need to maintain work week
regulation, mandatory employee benefits and industrial safety regulation that are
necessary to maintained by mangers of respective organisation.
Positive impact: Government of different nation are imposing subsidiaries and other sustainable
as well as eco friendly energy in order to have benefit for an economy. Moreover, with such
instance a respective organisation is able to attain sustainability for longer duration of time with
high loyal brand image.
Negative impact: The need to maintain high safety and security for their employees as well as
their customer's. For such instance the mangers need to occur high expenses in proper regulation,
ensuring its employee safety in order to maintain reputation of an organisation.
Economic Factors: As per the view point of Israel Kirzner, an economic factors have
significance impact on an organisation does it business and know its productivity and profitability
in competitive environment. Moreover, economic factor are those factor that usually impact on
inflation rate, interest rate, foreign exchange rate and economic cycle that determine aggregate
demands and investment in an economy. The factors that are impacted by BP oil are Many countries are depended on British Petroleum as well as supported by it's energy
supply. Moreover, many alternative sources of energy that are their growth is expected
less time. Therefore, it may bring threats to BO oil industry.
Positive impact: Many counties have supported BP oil by reducing tax and inflation rate so that
an country can develop its economy in an appropriate manner. Thus, it became beneficial for
both organisation as well as nation or country.
Negative impact: Herein, British Petroleum has faced many issues in entering new marketplace.
Such as huge norms and regulation, need to reduce carbon emission trading and effected by high
tax, interest and inflation rate.

Social factor: According to Krzysztof Wozniak, Social Culture usually impact on culture of an
organisation within an environment, it share beliefs and attitudes of population that plays a great
role in operating business. Mangers of BP oil need to understand such social factor such as: BP oil needs to understand marketplace in order to design oil and gas industry for
consumers. Such as demographic and skill level of population and reducing emission
trading and carbon funds into legal requirements. Moreover, social attitude, cultural issues
and population growth effect a respective organisation socially.
Positive impact: BP oil are production or designing their product and services in such a manner
that help them to reduce carbon emission which leads to create positive impact on environment
as well as society.
Negative impact: In many countries BP oil have faced may social issues such as buying and
consuming pattern of people differ from nation to nation. For such instance they need to observe
needs and wants of customer's as per the requirement which will lead to increase productivity of
an organisation.
Technological factor: According to Dr. Jack A Onysis, technologies are landscape that
changes and bring out huge impact in which an organisation are affected in marketplace. In
today's context technology is fast disrupting factor in growth of an organisation. The mangers of
BP oil need to analysis technological factor but also overcome with technologies that need to
speed. Such as: With proper adaption of technologies British Petroleum lead to refine, explore, distribute
in marketplace. Moreover, it will lead to increase in product offerings as well as create
value chain in oil and gas sector.
Positive impact: BP oil are creating positive impact in marketplace as they are adopting
advancement tools and techniques that help to provide better quality of product and services to
customer's.
Negative impact: The mangers of BP oil need to have a strong impact competitive marketplace
so that they dose not lack behind due to high competition and rivalry among existing market.
Stakeholder analysis
Stakeholder analysis is an important techniques that help an organisation to identify
analysis needs in competitive marketplace. It is basically used to identify all primary and
secondary stakeholder who have vested interest for which project is concerned. The main aim of

the stakeholder analysis a strategic and relationship between different stake holders that are
important for an organisation. The internal stakeholders are shareholders, employees and
suppliers and external stake holders of BP oil are customers, competitors, local communities etc.
 Stakeholder are central in huge corporations within British Petroleum as they play
fundamental role such as great amount of capitals which is essential to set up and operates
business function effectively.
 Suppliers plays a crucial role in chain and supply of production. Herein, the company
embeds different core values that essential in every kind of business operations.
Moreover, suppliers are ensuring that its action effects and reflects core value of
operation.
 Consumer are refer as king in marketplace. The main objectives of British Petroleum is
to understand consumers expectation in order to deliver quality of product to customer's
through out retail networks.
Thus, from the above analysis it has been determined that stakeholder analysis plays an effective
role in knowing what are the core interest of owner, customer's, investors and suppliers.
TASK 2
P2 Internal environment and capabilities of an organisation
BP oil is one of the leading oil industry in United Kingdom as well as at world wide. In
an organisation there are many different elements and operations that decides over all
performance of an organisation like, management, employees, working culture are known as
internal environment of a an organisation. Herein, mangers have direct control over management,
polices and procedures in order to perform essentially so that changes in internal environment
have strong capabilities in competitive marketplace. For such instance need to make certain
changes and improvement so that they can improve their working and achieve their goals and
objective. Moreover, the junior mangers of BP have identified many strengths and weakness
which are determined below:
 British Petroleum is one of the highest and loyal brand in United Kingdom. It has
diversified its product and services that have ample number of subsidiaries with its loyal
customer's. Moreover, they are having highest contribution towards economy's welfare as
well as have highest network connection at worldwide

 Moreover, they have faced many social and ethical issues in performing their business
function. They were caught in many scandals such as dishonest of transaction with their
employees and customers. Furthermore, they have also faced issues related to oil spills in
different location of world.
Thus, BP oil has efforts in many different areas of market, like non energy, but they do not get
success in that, which cause them huge loss in their economic conditions, productivity,
profitability and goodwill in competitive marketplace.
Internal environment of an organisation deals with management of resources like human
resource, physical resource, technology and other resource which are useful in developing and
maintaining reputation in marketplace. Moreover, it is composed of element within an
organisation that includes current employees, management and especially cooperate culture.
Herein, the managers of BP oil are developing an attractive work place for its employees and
staff members so that they can per their role, duties and responsibility in an attractive manner.
Strategic capabilities and its components
Strategic capabilities refers to capabilities of members within an organisation that usually
enable in formation and development of strategy in order to pursuit a sustainable advantage
(Jocovic and .etal, 2014). For such strategic capabilities management and mangers of BP oil has
determined McKinsey's 7 model in order to know its strategic capabilities and its components
Structure : Structure usually represent a way in which business division and units are organised
that includes information which is accountable with different roles and responsibilities. Herein,
mangers of BP oil are implementing management structure in their decision as they were poor
in decision making process. For such instance, mangers are use vertically integrated with this
structure while they make decisions for their teams as well as organisation.
Positive impact: The structure play's a vital role as it help managers of an organisation
so that a proper implementation of structure can de adopted so that they can overcome their poor
decision making process.
Negative impact: For such instance, if mangers of respective organisation are not able
to use vertically integrated with this structure then they will not able to attain sustainability for
longer duration of time.
System : System are process and procedures of a company which usually maintains daily
activities and function how business is operated. The mangers of BP oil are following many

safety measure regarding their staff and employee members. Moreover, they are adopting
leadership management style that help mangers to make understand to its employee and staff
members so that safety measure can be adopted in an appropriate manner.
Positive impact: Herein, mangers of BP oil are able to maintained and handle internal
processes, strategies are built within organisation then they will able maintain their productive in
competitive marketplace
Negative impact: herein, If mangers of BP Oil need to maintain safety measure than they
will not able to maintain such proper and systematic manner of performing their task and
activities.
Style : In the model style represents that an organisation decision is represented by top level of
deep water horizon accident, leadership style used by them was not able to make their employees
and contractors to understand the importance of safety measure Their corporate culture has
stubborn nature, which is very much known as culture of arrogance.
Positive impact: Herein, if the mangers are able to adopt proper and effective strategics
then their is no occurrence of skills gaps and conflict situation. Which make peaceful and
positive working environment.
Negative impact: Moreover, The limitation of adopting a particular and specific style is
that adopting a particular culture for a long time seems as a limitation
Staff : In this model style The staff of BP oil do not understand the importance of safety, as they
do not think that safety as a core element for their organisation. This is all because of lack in
communication of importance of safety among employees.
Positive impact: Herein, by examining staffs in effective manner manger able to develop
strategies, policies, rules and regulation in effective and appropriate manner. Additionally, it will
help to allot work to right employees in effective manner.
Negative impact: If both employer and employee are not able to understand in an
appropriate manner than organisation able to understand every employee or staff in effective
manner.
Skills : The staff of BP oil has lack of skills that are required while dealing with an accident or
preventing it in line with values shared by BP oil safety and environment. This is because,
leadership is not able to communicate with their staff about the importance of these skills in
safety and growth of them.

Positive impact: Herein, if an organisation have specific and appropriate skills they able to
conduct work or task in appropriate and effective manner.
Negative impact: In order to be effective in team employees has to update and enhance
there skills which seems as limitation for staffs.
Strategies : herein the mangers have adopted a strategy, which make a condition for them of no
profit and no gain, which was named as “federation of assets”. Thus, this help them in gaining
some incentives in sharing best practice in risk management and safety.
Positive impact: Strategies plays an essential role in order to maintain strength within
an organisation. Moreover it is one of the action plan is anticipation of alteration external
environment. So the effective and attractive strategics can be adopted.
Negative impact: Herein, if managers fail to adopted such effective strategic then they
will not able to achieve their goals and objectives in an attractive manner
Shared vision : In this model BP oil managers have several rules and regulations in their
organisation related to safety and other operations of organisation. Moreover, due to lack in
leadership style, their employees are not able to follow them. Hence this process help mangers
lead to delay in achieving organisational goals and objective, and also can cause loss to
organisation.
Positive impact: In an organisation this method usually develop feeling of cohesiveness
and connection with employees as well as company. Eventually, if employees understand it in
effective manner they able to conduct work in proper way.
Negative impact: Within an organisation, if each and every employees don't have same
behaviour then they will not able to stretch themselves as per their need and requirement of an
organisation.
M2 Critical analysis of McKinsey's 7 model
With the adoption of McKinsey's model the mangers have overcome with various
positive and negative impact which hight impact ion business performance and outcome in an
attractive manner. Herein, this model help mangers of BP oil to develop effective structure of
working criteria with the adoption of proper management styles and leadership approaches that
are effective in nature and help mangers in taking appropriate decision. Moreover, share values
influences mangers to take decision in delay manner as they to identify this process so that they
do not loss business gaols and objectives.

VRIO model :
In today's context VIRO m model is adopted as it is an analytical tool that help in
evaluation of company's resources and know competitive position of an organisation in
competitive marketplace. Herein, the mangers of BP oil has implemented this model to know its
value of resources as well as its competitive image in marketplace. Such as:
Value : As per view point of Pranzetti, it is creating value for its organisation with its
offerings and garbing opportunities in competitive marketplace. Resources which they use for
adopting new ideas and innovation. Moreover, it help in conduct work in effective and efficient
manner.
Rarity : As per view point of Knott, it refers to those products and services which are rare
and it is not easily inmate by other companies Herein, they have rarity in their product and
services as well as maintaining huge plan in Gulf as one of the unique resources within an
organisation.
Immutability : According to Mare, it refers to those factors which is not inimitable by
other companies easily. This can create cause huge amount resources as an organisation need to
maintain huge amount cost in order to maintain reputation of their organisation.
Organisation : As per the view point of Indartono and Wibowo, It refers to those factors
which can sustain for long term without any difficulties. They are maintaining their resources in
an effective manner so that work become easier as well as stability can be maintained in
competitive marketplace.
TASK 3
P3 Evaluating competitive forces of a given marketplace of an organisation
In today's context industry attractiveness forms part of different industry structure. It is
greater potential profits that have to be investigating in competitive marketplace. Nevertheless,
companies are considering to enter into new marketplace in order to determine what kind of
move would be beneficial that is useful in respect of company's prospect. Herein, the mangers of
BP oil are adopting Porters Five force field analysis in order to know its competitive position in
competitive marketplace.

Threat of substitutes : Substitutes are the products which are use for replacing one when
it is not available or on permanent basis. The best example of substitutes are tea and coffee, a
person who use to drink coffee, some time drink tea when it is not available. BP oil is a big
organisation of UK in oil and sector, and substitutes in this sector are narrow. The option of
substitute is available in very few cases, like, if a customer has choice in two or more types of
fuels then only this can be consider as threat. There substitution effects is less in number because
companies are working for their development. A vehicle can run only on one either it can be
liquid or can be gas, therefore, substituting their product is not possible till now. And the force of
substitutes are negligible for them.
Bargaining power of buyer : In this model this factor considered as powers of buyers
related to organisation's customers. Herein, organization analyse about the buyer's power to
bargain. This factor also depends on competitors available in market with similar good and
service. Moreover, in such case an n that industry prices depends on global demand so they have
high level of bargaining power. Herein, mangers of BP oil has its loyal customers in competitive
marketplace. Moreover, they are providing their offerings with affordable price with premium
quality. Thus, with high number of loyal customers an organisation are able to decrease in
difference between rate reduces the force of buyer on their bargaining power.
Bargaining power of supplier : In this, process an organisation use to analyse the power
owned by organization's suppliers. Herein, if any supplier do not get agree on their terms then
the cost of switching over another supplier for them will be very low. In perspective of Bp oil
their bargaining power of supplier is in that field is oil field and engineers and technicians so they
have edge over suppliers. Mangers of BP oil have limited suppliers with their on terms and
condition as they don't want to compromise with their quality of product and services. Thus,
such influences of BP oil reduces the force of supplier's in competitive marketplace.
Threat of new entrance : In today's context an organisation need to maintain such rules
and regulation as it is not a easier task to do. As this process save their time and resources which
they can invest on to design some other strategies. Moreover, an respective industry is attractive
in competitive marketplace but due to huge cost less threat of new entrants available in that
industry. Herein, mangers of BP oil have great advantage as it is not easier for competitor to enter

into such market. Therefore, these factor indicates impossible for a common people to invest
and launch their venture in this sector
Industry rivalry : Herein, an organization need study about their existing competitors in
market and make strategies to gain some competitive advantage. Additionally, their rivalries are
British petroleum in which shell, gulf coasts that already well established brand name in industry
so they have high industry rivalry. Moreover, BP oil has number of competitors which are
ultimately affecting its competitive position and market share in competitive marketplace. For
such instance BP oil has started its emergence with small organisation of same industry line
which help them in gaining competitive advantages in marketplace.
M3 Appropriate strategies to improve competitive edge and market position
Ansoff Matrix is strategic management tool that provides a sequence that help an
executives, mangers so that marketers devises strategies for future growth of time. Herein , the
mangers of BP oil are adopting such matrix so that they can attain sustainability for longer period
of time.
Market development : This matrix of market development will help them to lead their
their business and operation by providing same products with premium quality.
Market penetration : In this case BP oil mangers can increase their probability in their
existing product and services such as by adopting different and attractive promotional activities.
Product development: Herein, the mangers of BP oil are making advancement in their
product and services in order to enhance market share and maintain quality in competitive
marketplace.
Diversification : Herein, mangers faced lot of problems as it is one of the most risky
strategy for an organisation. As it become difficult for an oil industry to bring diversification in
product line.
TASK 4
P4 Applying theories and models to devise strategic planning for an organisation
In an organisation mangers of BP oil are adopting Porter's Generic model for making
effective strategies that is essential for an organisation in order to gain competitive advantages in
same product line industry. Porter's generic models adopted by mangers of BP oil as it can be

used by to strategies. Generic strategies of BP include safe, reliable and compliant operations;
financial and operational momentum and strategy through upstream, downstream and corporate
simplification. The strategies adopted by mangers are determined below:
Cost Leadership : Cost leadership strategy is helping mangers of BP oil in gaining some
competitive advantages by offering their product in low cost in competitive marketplace. Herein,
they are producing their product at low cost in order to attract large number of customers.
Hence, this will help them in gaining some competitive advantages as well as increase their
productivity and profitability. along with increase in their profitability.
Differentiation : This strategy is helping mangers of BP in order to differentiate their
product and services from its competitors. For such instance there are creating unique value in
market place by fulling customers need and demand as per their requirement.
Focus : In this strategy cost focus help an organisation to make strategies which can
make their focus only on the cost of product in competitive market place. Herein, it helps Bp Oil
in making proper strategies so that stability can be maintained. Where as, differentiation focus
can help BP oil help mangers in making strategies which has main focus on making a product
which can create uniqueness in marketplace
M4 Strategic management plan
It is a organizational activity document which is used to communicate within the industry and it
includes in organization's goals, set responsibilities, focus energy, resources, strengths of
operation that ensures the employees and stake holders are working together to achieving
common goals and objectives within the organization. There are lot of methodologies and
frameworks that follows the same pattern and have a common goals. It helps in to set vision and
mission of the company and maximize organization's resources to reduce wasting time and
money or extra activities that are not necessary for the company. This also helps in to understand
the industry trends and scenarios that influence an organization. Strategic management plan is
important to identify the correct way to accomplish company's goals and objectives.
Producing Strategic management plan that has tangible and tactical strategic priorities
In an organisation Strategic management plan is a document which is used by
organisations to communicate their plans and goals within an organisation. Herein mangers are
adopting strategic management plan in communicating activities to its employees and staff
members.

 The main and motive goal of the BP oil is to improve their goodwill and attain
sustainability fort longer period of time.
 Moreover, involve the description of business as BP oil is European company which
deals in oils and gas products. So that each and every business function and operation can
be achieved.
 The mission of BP oil is to increase their profitability, productivity as well as attain
sustainability in competitive marketplace. The main strength of BP oil is technologies used by them, where as weaknesses are their
poor reputation in market due to loss co workers within organisation.
Vision: The vision of B P oil to have best competitive corporate in same business line as
well as to become assessable, inclusive and diverse.
Mission: Its mission is to bring integrity, honesty dealing with dignity and striving for
mutual advantage as well as working towards human progress.
Core Value: - The core value of British Petroleum is to provide good quality products
and services to customer as well as remain competitive in marketplace.
Objective: To Introduce new oil services and scheme in Russia with the new joint venture
strategies in order to enchaining 5% more market share.
SWOT analysis: -
Strength Weakness
 British Petroleum is one the biggest oil
company at world wide. Moreover, it is
serving with best and premium quality
of product and services in competitive
marketplace.
 Herein, BP oil have negative
perception of public regarding company
as they were losing their reputation due
to its high competition.
Opportunities Threats
 An organisation can enhance price of
fuel or oil as there is more demand of
natural gas in market so respective
company can operate in market.
 Competition in market is big threat of
company due to more of competitors.
Moreover, restriction and regulation of
government where they are operating
in it.

Moreover, mangers of BP oil are developing Tuck man's model of team developing in an
attractive manner.
Forming stage: In this stage, in an organisation employee belongs to different culture that
influence their working culture in performing their task. Moreover, this is the first stage in team
development in which autocratic leadership approach helps to conduct introduction between
employees in order to provide them information in regard their roles and responsibilities.
Storming stage: At this stage employees being to see themselves as a part of team.
Herein, in this process BP oil manger aid leader to analysing ideas and thoughts of individual
properly so that gaols and objectives can be attain in an attractive manner.
Norming stage: At this time, team members starts working together for the
accomplishment of their targets. Thus, democratic leadership approach can be more impactful for
BP oil mangers in order to provide strategic direction to employees in regard their new project
and development of an organisation.
Performing stage: In this stage mangers of BP oil are adopting situational and
contingency leadership which is termed as more beneficial in terms of analysing current situation
or identifying changes within an organisation.
Adjourning stage: This is the last stage of while project ends and team dissolved.
Moreover, with the implementation of such leadership theories BP oil mangeres can easily build
new team for their diversification approach.
Thus, theory is appropriate for respective company for developing effective team but it
also has certain limitations like it is time consuming because manager has to evaluate and
analysis employees’ skills and ability. Thus, it help mangers of BP oil in order to develop team
and individual in an effective manner.
CONCLUSION
Form the above report it has been concluded that business strategies play's a essential role
in adopting future goals and objectives for longer duration of time. This assignment was
structured into four task. Task one consist of frameworks and impacts that influence macro
environment and its strategy as well as critically analysing strategic management decision.
Moreover, Task two will consist all internal environment and capabilities of an organisation and
critically analysing McKinsey's 7 model in order to know its competitive advantage in
marketplace. Additionally, Task 3 will covered what are the competitive forces of a given

marketplace of an organisation with adoption of appropriate strategics to improve competitive
edge in market position. Furthermore, task 4 help mangers to adopt theories and models to
devise strategic planning for an organisation.

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