Instructions to Candidates 1. The assessment contains four sections that cover the four main thematic areas of the module. For sections 1, 2, and 3, select and answer one question. Section 4 contains...

British Petroleum
British Petroleum

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British Petroleum
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British Petroleum

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S.No Table of Content Pg No
1 Introduction 3
2 Mission Statement 5
3 Porter's Five Forces 7
4 Porter's Five Forces Analysis of BP 8
5 VRIO Framework 9
6 Recommendation 10
7 Conclusion 11
8 References 12
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Introduction
British Petroleum (BP) is one of the world’s seven super major Oil and Gas companies. It
is British Multinational Company and is headquartered in London, England. The company
provides fuel for transportation, energy for heat and light, lubricants to keep engines moving and
petrochemicals products used to make everyday items as diverse as clothes, paints and
packaging.
BP was started in 1908 when the oil was found in rugged parts of Persia. The company
was established as subsidiary of Burmah Oil Company which helped them in exploiting the oil
discoveries in Iran. The company has its operations in and around 80 countries As per annual
report 2014, the company has 85,000 employees working. They believe that the projects and
operations on which they are working are helping them to generate more employment,
investment and tax revenue in the countries where they are operational. The revenue of the
company as of 2014 is 65,424 million. The company has produced 34,869 millions of barrels of
oil. There are approximately 17,200 retail sites on which BP is present.
The company was amongst the first to engage in the strategic international issue. BP
served many nations through the world wars and significant history events. BP has put its plants
in the potential oil production zones. They established themselves not as a brand but also as a
raw material producer for processing the crude oil.
The company has two main operating segments – Upstream and Downstream. The
company’s main aim is to achieve sustainable success as a group and to work for the benefits of
shareholders, society and partner in a long term. The business model of the company spans from
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exploration and marketing. The portfolio of the company is diverse and integrated which si
focused on the prevailing conditions.
Upstream - In their upstream segment, the company is actively managing their portfolio
to their strength. They are divesting non-core assets and in a long term they are finding
alternative ways to create value. This segment is responsible for exploration of oil and
natural gas, field development and production, storage and processing, and midstream
transportation.
Downstream – there was continuous improvement has been seen in safety process and
strong operational performance of the company in 2014. This resulted in profit and
operating cash flow growth. Downstream is product and service led segment of BP which
is made up of three businesses of Lubricants, Fuel and Petrochemicals.
The main competitors of BP are: Exxon Mobil Corporation, Chevron Corporation, Royal
Dutch Shell plc and many other oil companies. The company is working on five values which
express the shared understanding of what they believe in. These values are Safety, Respect,
Excellence, Courage and One Team. In 2014, Global primary energy consumption decelerated
sharply. The consumption rate for all the fuels has increased except the nuclear power. Except
coal the production for all the fuels has also increased. Global consumption growth of natural gas
is weaker than production.
In 2014, there was an increase of 0.9% of global primary energy consumption. Dated
Brent was averaged $98.95 per barrel; there was decline of $9.71 per barrel from 2013. There
was no change in Crude oil in 2014 and remained firm. The global oil consumption grew by 0.8
million barrels per day.
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The company committed to help in meeting up the energy demand through mix of
technologies and fuels. It also continued to increase stakeholder engagement on the change of
climate. Through the use of branded fuels and engine oils they improved the fuel efficiency.
Mission Statement
A mission statement of the company is a statement which is used as a way of
communicating the purpose of the organization. Although the mission statement of the company
remains same for long period of time but it is also not uncommon of organizations that change
their mission statement. This statement is generally consisted of three components that are very
essential.
 Target Market
 Contribution
 Distinction
The main purpose of mission statement is to serve as the goal/agenda of the company. A
mission is general expression of the overriding premise of organization which ideally would be
in line with the values and expectations of the major stakeholders. It is concerned with the
overall purpose of the organization, its boundaries and its scope. It sometimes refers to the
challenging question “What business are we in?” (Johnson & Scholes, 1993)
British Petroleum does not have any official mission statement but they do have several
different statements which are called as:
 What we do? – BP claims that they find, develop and produce sources of energy
which are very essential. They convert these sources into the products which are
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needed everywhere. There is need of energy all over the world and due to which
the need of energy is growing. This energy is available in many forms and it will
always be. They are committed to provide high...