Supporting Development of British Petroleum - Case Study Example

Answers Answer British Petroleum is a London based organization. The organization has multinational presence as far as its structure is concerned. The organization has business operations almost in 80 countries across the world. As far the market capitalization is concerned the organization is in the sixth place in the industry. The organization deals with lots of products as well as services. The company is one of the leading providers of products like Ethane, Propane, Isobutene, Normal Butane and natural gasoline. The company gives significant focuses towards the NGL services like Fractionation Storage, Transportation, Marketing, Trading, and Risk Management. Progas is also a product for the organization. Natural gas is also an important product for the company. Apart from natural gas, the London based organization has products like Petroleum, Motor Fuels, and Petrochemical and aviation fuels. In 2013 revenue of the organization was US$ 396.217 billion. As far as the revenue of the organization is concerned it is the fifth largest organization in the industry. The company is vertically integrated. BP over the years has done multidimensional works in the industry. The organization is engaged with exploration, production, distribution, and refining, trading and power generation. BP is public limited company and shares of the organizations are traded in London Stock exchange, New York Stock exchange and Frankfurt Stock Exchange. Political and economic factors are the two key factors as far as the external environment of the organization is concerned. The organization has multinational presence. Political stability is significantly important for the company (Ulph, 2011, pp. 45-47). Political situations of the different countries vary from each other. Political situation of USA is significantly different from the same of Somalia and Pakistan. When the organization takes any project overseas, it involves lots of human resources, finances and technologies. Political instability can be a significant matter of concern for the organization. Global political unrests can delay the projects of BP. It can be a significant barrier to success as far as the financial results are concerned. Global economic situation is also a key external factor for the company. If the economic situation of the world is sluggish then revenue of the organization can decline because sales figure of the organization will decline due to sluggish economic situations. On the other hand if the global economy is doing well then demands of the energy products will increase and revenue of the company will increase as well. Answer 2 Due to the large business operations, the organization deals with lots of stake holders. Here in this section of the study three most important stakeholders of the company will be discussed. Human resources of the organization are one of the most important stake holders. Performance and business operations of the organization are significantly dependent on the highly skilled, dedicated and talented workforce of the company. Executive or top level workforces of the organization take key decisions related with the business strategies of the company. Employees of the organization are significantly responsible and engaged towards their duties. Employees of the company shares close relationship with the organization. Business ideas of the employees are given significant importance. In 2013 the organization conducted an employee survey where almost 37,000 employees across 70 countries shared their business related views. Investors of BP are the integral parts of the company. Over the years the organization has given significant importance towards the investors. The organization shares close relationship with investors. Chief executive of the BP group and the other executive members of the organization manage close relationships and meet with them on a regular basis. Investors of the company provide the required funding for taking different energy related projects across the world (Wright & Gallun, 2005, pp. 56-58). The organization believes in sustainable free cash flow. Investors of the organization can ask for different information related with the investment through the email. Investors of the company can express their business related views with the help of Proxy Vote. Society is also an important or key stakeholder for the organization. The company has clearly identified the role of society in their business operations. Due to that BP is significantly committed towards the society where they work (BP, 2014). Society and the organization share automatic relationship between them. Business operations of the company are significantly influenced by the local societal situation. So, the organization maintains close relationship with this important stakeholder. Answer 3 Primary stakeholders of the organization are utterly important for the financial performances of the company. Efficient and productive workforces of the organization can influence financial performances significantly. It can increase the efficiency and productivity of the whole organization. Due to this operating costs of the organization can be reduced. Once the operating cost get reduces then automatically profitability of the organization increases. In this way work force can influence the financial performances of the company. Supplier and contractors of the company are also essential for the financial performances of the company. With the continuous supply of quality raw materials the organization can finish or manage a project within fix and stipulated timeframe. It avoids any kind of project delay. If projects are completed within the stipulated time frame then the organization can save lots of money which is financially suitable for BP. Investors are utterly important for the organization as far as their financial performances are concerned. Sentiments of the investors can influence the financial performance of the company. If investors are confident about the business operations of BP, then the investors will invest their moneys in the company. In this way share price of the organization increases. If investors are not confident they will not invest their money into the company and share price will go down. Government policies can influence the financial performance of the organization. If the Government agencies impose any kind of tax related with a project of the organization, then certainly it will hamper the financial situation of the company. Tax policy varies from country to country. Different government interest rates also vary in various countries. So, Government is an important stake holder which can influence financial performance through taxing. Society is also an important stake holder for BP. With the help of CSR the organization tries to give something back to the society. To fulfill their social duties the organization has to allocate some budgets for their CSR activities. All the allocations related with the CSR activities can influence financial performances of the organization. Answer 4 BP faced controversial corporate responsibility concern in their Tangguh project. During that project the organization faced significant issues. During that project the organization used indiscriminate local military authority which raised the eye brows of global people. The plan of the organization was to make the project site a military free zone. With the help of this the organization was trying to introduce a community based approach to their security. But Indonesian military TNI was significantly dissatisfied with the decision of BP. They tried to create instability in the project region. Due to the torture of the TNI, almost 5000 people left the project area. TNI conducted an operation known as “Operation Comb & Destroy”. With the help of this operation TNI tried to get or grab the security responsibility of the project site. Human right in the project area was significantly ignored. According to a study of BP, the project was significantly detrimental as far as the environment of the region is concerned. It created noise pollution, gas pollution and pollution from gas emission. The project emitted sulphur dioxide, nitrogen dioxide, carbon dioxide and hydrogen sulphide. All those gases were significantly detrimental for the environmental balance of the region. The project left behind lots of solid and liquid wastes during the drilling and extraction. All those wastes increased the carbon foot print of the region. Different wastes were contaminated into the local water. It hampered the quality of water surrounding the project area. The project of the organization affected the mangrove forests significantly. Before coming into the project the energy giant boasted a lot regarding the environment sustainability of this project. The organization carried out an Environmental Impact Assessment to reduce the adverse environmental impacts. It was the first Greenfield project in the industry. The project was criticized from different parts of the society. Most of the experts termed the project controversial. Answer 5 I would identify the members of the coalition group with the help of some steps. First of all, I would identify all the direct and indirect stakeholders of the organization. In this step all the stakeholders related with the organization will be would be identified. Then I would judge the varying influences of the stakeholders on the company. This step will be done on the basis of priority with the help of stakeholder mapping. Then I would take representative from all the stakeholder groups. I would take more members from those groups which can make significant impacts on the company’s decisions. Most of the members would be from the investor group, societal group and from the government agencies. As far as forcing the organization is concerned, three targeted groups are significantly important for me to accomplish my goal. Investors are the pillars of the company. BP will not be able to take its investors for granted. If the investors stop investing into the company then the financial situation of the organization will be hampered significantly. If the local community related with the controversial issue opposes the project and does not support the company then the project cannot be successful. If government agencies impose any kind of ban or taxes then certainly profitability of the BP project can be hampered. All the above reasons are clearly articulating that all the targeted groups have significant influences on the decision making procedure of the company. That is why I have chosen these three groups. Proper collaboration is significantly important among the all targeted groups. I would arrange meetings after regular interval of time. In that meeting all the members of the coalition would share their ideas regarding the controversial issue. Apart from physical meetings I would create a social networking platform through which members of the coalition would manage a close relationship among them. I would arrange joint activities to pressurize the organization. Answer 6 Forming a coalition has significant challenges. Here in this section three challenges that I would face to create a coalition would be discussed. Interpersonal conflicts among the members can be a potential challenge for me (Kouzes & Posner, 2012, pp. 78-82). Members from the different groups may fight among each other to gain the supremacy or importance. Due to the time constraints members of the different groups may not come together on a regular basis. Each and every targeted group has their own stipulated works. It is very difficult for them to come to a common platform and manage time. Due to varying ideas of the targeted members it is very difficult to come to a common platform. I would overcome the challenges of the interpersonal conflicts with the help of various team building activates where members from the different groups would be encouraged to reduce their interpersonal conflicts. I would give equal opportunity to all the targeted groups to share their ideas. It would certainly reduce the battle for supremacy. I would make a calendar for meeting with the people of targeted groups. The calendar would be made on the basis of collective time availability of the different stakeholder groups. When the calendar would be made I would invite representatives of the all targeted groups. In this way all those groups would inform me about their availabilities. Time constraint would be overcome with a collective time calendar. I would assign important responsibilities to the members of the group. I would try to manage a common harmony or middle path among the varying ideas of the different targeted groups. It would help me to bring all the members to a common platform i.e. to pressurize the organization to address the controversial issue. References BP. (2014). Supporting development in societies where we work. Retrieved from: http://www.bp.com/en/global/corporate/sustainability/society/Supporting-development-in-societies-where-we-work.html. Kouzes, J. M. & Posner, B. Z. (2012). The leadership challenge: how to make extraordinary things happen in organizations. New York: John Wiley & Sons. Ulph, C. (2011). PR analysis of British Petroleum. Berlin: GRIN Verlag. Wright, C. J. & Gallun, A. R. (2005). International petroleum accounting. New York: PennWell Books. Read More