Question
Please answer the following question based on BP (Beyond Petroleum) case.
1) Describe the 5 competitive forces in the industry.
2) Draw up a strategic plan of this industry. Include all major players.
3) What are the key success factor in this industry?
4) Which of the five generic strategies best describes the organization's strategy?
5) What is the financial conditions in this industry?
The case is following:
BP (Beyond Petroleum) Focuses on Sustainability BP formerly British Petrolom and the Anglo In?doing, the company also hopes to educate Persian Oil Company, has experienced a lot of others about how they can personally reduce ups and downs over ins hundred-year history their impact on the environment in the h trom nearly bankrupeing its founder William of repositioning itself as an environmentally e one of the woeld's largest responsible company energy companies. BP has also experienced its fair share of controversies practices, enviroomental damags, and hazards to workers. It and all oeher lar business THE 100-YEAR HISTORY OF BP Arey, a wealthy British genilkman D'Arcy to pursue ing, both his patience and finances were nics have come under fire for beins re for the rekase of huge anmounts of reenhouse who had invested all his savings in the qu gasses into the atmosphere. BP, however, has for oil in the Middle East. While experts and attempted to turn a page in its history hook scientists had encouraged toward a more environmentally-friendly future. the venture, after more than six years of The company has invested in renewable energy drill and has thrown large amounts of support behind running low. Finally, in 1908, the drillers ethics and compliance initiatives, even writing reached almost 1,200 feet and a fountain of an expansive code of conduct for its 92,000 oil spewed out. After long years filled with employees disappointment, pain, and despair, the Anglo- This case provides an opportunity to Persian Oil Company, what would become observe the efforts of BP to improve its image BP, was born. The company quickly opened and manage decisions related to ethics and social trade on the stock market, and D'Arcy, who nsibility. Before delving into recent issues had lost nearly his entire net worth, became that BP has faced, a brief history of BP is givm rich to provide some background. Although BlP hasA naptha field in Iran, formerly known sought to establish itself as an ethcally respon as Persia, located around 130 miles from the sible company, certain disasters resulting from mouth of the Persian Gulf, was the first place company megligence are detailed in this analy where the Anglo-Persian Oil Company estalb- it has often failed at this goal lisbed a refinery. (Naptha refers to any sort petroleum product, In this case, the Anpa in the past. In recent years, BP has realized the need to become of more environmentally-friendy, Persian Oil Company was pumping crude o being the first oil company to recognize the George Reymolds, D'Arcy's head manager tor presence of global warming and to launch ini a all the miners, quickly discovered that navi be cleaner forms of energy gating this rugged land was not going to This case wn develepes aecer the direction of oc
Explanation / Answer
1. The five competitive forces in the industry are as follows:
1. Competitive rivalry - This is the force which help to know about the bottleneck competitors of the business. It also helps to identify their ability to Threaten the company. If all the revelries are providing same kind of product and they are larger in number then the power of company would be reduced. In this case, there are major players of energy in the market so the company faces a kind of threat from them.
2. Potential of new entrants in the industry- The potential of new entrants in the industry is is quite low. This is because of the reason that there is a government intervention while starting a business or performing operations of businesses. As they are dealing with non renewable sources of energy which need a protection. Hence, it is not easy to get the certification from the government for the business operation in field of energy. This helps the company BP having Monopoly in the market.
3. Bargaining Power of supplier- The bargaining power of suppliers is very high because there the less number of suppliers.
4. Bargaining power of customers- The bargaining power of customers is moderate. This is because of the reason that large number of customers in the market in comparison to suppliers.
5. Threat to substitute products- There are other substitute products of energy such as solar energy, wind energy etc. Hence there is a threat to the main product. Its intensity is also high.