Company overview of BP

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BP is a global oil and gas company headquartered in London, United Kingdom. It is the third-largest energy company and fourth-largest company in the world measured by revenues and one of the six oil and gas "supermajors".Its products include exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has major renewable energy activities, such as biofuels, hydrogen, solar and wind power.

The brands are:

BP

The main global brand, appears on every product and place of it. It has been growing since 1920s, when 'BP' petrol first went on sale in Britain.

Castrol

The lubricants brand BP acquired in 2002. Products include motor oils for automobiles and motorbikes, and also lubricants for every conceivable application on land sea and in the air

Arco

Joined the BP group in 2000. Arco is the leading gasoline marketer, whose name and branding appear on all BP-owned and franchise-operated stations in the western USA.

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Aral

One of the most trusted brands in Germany. It has been associated with quality automotive fuels. It is also the country's third largest fast food retailer, after McDonald's and Burger King.

ampm

Is a value-add-on to select ARCO gas stations, selling from packaged beverages, grab-n-go sandwiches, treats or fountain drinks. The brand covers many states of the US as part of select ARCO and BP fueling stations.

Wild Bean Café

These on-the-go cafes are tucked into many BP Connect stations, open 24 hours a day, 7 days a week, and offer inventive sandwiches, fresh baked goods and delicious, fresh-ground coffee.

Which business generates the most revenue? ( 100 words )

BP has two major businesses:

Exploration and Production

Refining and Marketing

In the 2010 segmental financial report, revenues of the businesses are:

Revenues after consolidation (equal to Sales and other operating revenues less sales between businesses) are $29.217 million by Exploration and Production, $ 265,393 million by Refining and Marketing, and $2,497 million by other businesses.

Therefore, Refining and Marketing is the business that generates the most revenue for BP.

Which business generates the most profit? ( 100 words )

Replacement cost profit is an accounting practice for reporting profits in the oil industry.

In the oil industry, the cost of goods sold varies significantly due to fluctuations in the price of oil. Replacement cost profit addresses this problem by allowing oil companies base their cost of goods sold on the current price of oil, rather than the price at the time individual reserves were acquired. In other words, oil companies report profitability based on how much it would cost the company to "replace" the reserves it sells.

In 2010, BP's EBIT (equals to Replacement cost profit (loss) before interest and taxation adds Inventory holding gains) is contributed by: Exploration and Production: $30,970 million, Refining and Marketing: $7,239 million, and Other businesses: ($1,500) million.

Therefore, Exploration and Production is the business that generates the most profit for BP.

Which business will drive growth in the next decade? ( 100 words )

The world's energy demand will increase faster in the near future, despite the slow down of economy growth. Most of that increased demand will be supplied by hydrocarbons - that is oil and gas. Although much work is being done on alternative and renewable forms of energy, these provide only a tiny proportion of the world's energy supplies. According to Lord Browne [1] , "there are no renewable or alternative fuels yet available which can compete with hydrocarbons and while there are some very interesting technical possibilities for the long term, we don't believe that new forms of energy will make a material contribution to global energy supply within the next 20 years".

Therefore, Exploration and Production will still be the driving activity for BP's growth. In addition, Richard Paniguian [2] shown that BP's average growth forecast for the next decade is 1.5% per annum for oil, and 3% per annum for gas. So in the next 10 years, BP's exploration and production of gas will likely be in focused.

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How successful would you say this company has been since 2007? ( 100 words )

The following chart show the oil production of five supermajors, include BP, Exxon Mobil, Shell, Chevron, and Total. The BP has been outperformed all the other since 2005, and the gap between production seems to be increasing. Moreover, since 2007, BP has been able to maintain the oil production stably, produced even more in 2009, while many other companies suffered a decline in production.

The next chart shows the financial performance of the group during 2007 - 2010 (numbers are collected in BP's annual reviews of the corresponding years). Except in 2010, when the group suffered a significant damage from the Deepwater Horizon oil spill, BP has been able to make about $30 billion profit on average ($28.8 billion in 2007, $41.7 billion in 2008, and $22.5 billion in 2009). If the expenses of $40.9 billion for the Gulf of Mexico oil spill reponse in excluded, then the BP's 2010 profit would be $35.4 billion [3] .

In general, since 2007, BP has been successful in maintaining it's oil and gas exploration and production growth.

Corporate Responsibility ( 12 % )

How has the company responded to the increasing demands of society for greater Corporate Responsibility? ( 100 words )

BP try to make their impact on local communities and economies positive by running their operations responsibly and by investing in the community in ways that benefit both local populations and BP.

BP use local suppliers wherever possible as this minimizes costs and enables them to form strong relationships with BP's vendors. It is also beneficial for local companies to become suppliers to a global company.

BP identify possibilities for investment through contacts with local people and organizations. Their programmes range from support for education and public infrastructure programmes.

BP also share their technical expertise with local governments.

BP committed $744,000 in 2009 to humanitarian aid through the BP Foundation. They supported relief efforts for the victims of natural disasters worldwide.

Or to the challenge of sustainability ( 100 words )

Today's energy has become a complex challenge, with strategic, economic and environmental dimensions. The main ways to meet the world's future energy challenges are through diversity, by accessing the widest range of energy sources; competition, by bringing out the best ways of finding, producing and distributing energy; and efficiency, by making the most of each unit of energy.

The world could potentially consume around 40% more energy in 2030 than we consume today [4] . In meeting this demand sustainably, the energy companies will need to supply a diverse energy mix. The mix will be more than oil and gas - but hydrocarbons will still be a major part of it.

BP's analysis indicates the world has enough proved reserves to last for about 40 years for oil and 60 years for gas. BP has been working at the industry's frontiers and continuing to innovate in their technology and processes in order to find more oil and gas. For example

They made the Tiber discovery in 2008, more than ten kilometres beneath the Gulf of Mexico.

They are pioneering new technologies - such as digital imaging of reservoirs and advanced drilling techniques - to access gas that is locked in dense rock formations.

They are getting more oil and gas out of mature fields.

Or Climate Change ( 100 words ) ?

BP is acting to address the issue of climate change by making its operations more energy efficient and by creating products that help lower customers' carbon footprints. Its prgramme of action includes:

Trying to manage greenhouse gas emissions from its operations. Requiring operations to incorporate energy use in their business plans and implement technologies and systems to improve it.

Trying to produce its hydrocarbons as efficiently as possible, and work in partnership with vehicle and equipment manufacturers to improve the efficiency of fuels and lubricants. For example, Ford's Fiesta, Focus and Mondeo are engineered with specially formulated, advanced BP Castrol lubricants, which improve fuel efficiency and therefore reduce carbon dioxide emissions.

Building a focused portfolio of material renewable and low-carbon energy businesses. There are four key areas: biofuels, wind power, solar photovoltaic systems, and carbon capture and storage.

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Factoring a carbon cost into its investment appraisals and the engineering design of new projects. New BP investments with material carbon emissions are required to include a cost of carbon that can realistically be expected over the life of the project. This helps to keep its investments competitive in both today's world and future where carbon has a more robust price.

Participating in the policy debate, calling for policy action to put a price on carbon and stimulate renewable and low-carbon energy. For example, BP signed the Copenhagen Communiqué, a declaration by businesses calling for "a long-term ambitious, robust and equitable global deal on climate change."

Funding and participating in a wide variety of research programmes on climate change and low-carbon options for the future. Some examples are: the Carbon Mitigation Initiative at Princeton University, the Energy Initiative at MIT, the Energy Biosciences Institute, the Stanford University's Program for Energy and Sustainable Development.

What evidence is there that the company engages with external stakeholders? ( 100 words )

One of the most important external stakeholders is the local government, where BP locate its business. Several evidences of BP's engagement with the stakeholders are:

In Azerbaijan, BP are supporting a project to improve the technical advice provided to policy-makers, known as the Advisory Programme for Macroeconomic Management and Institutional Reforms.

In Trinidad & Tobago they have advised the government on its strategy for energy efficiency and renewable energy.

BP's economic experts visit many countries to share the findings of the BP Statistical Review of World Energy. On their international visits, BP's team explain to government officials, academics, diplomats, journalists and others how the data can be used to improve understanding of the market context in which countries develop their energy policies and strategies.

BP support the Oxford Centre for the Analysis of Resource-Rich Economies to study how countries rich in oil, gas and minerals can use their resources for successful development, rather than falling prey to mismanagement, corruption and deterioration of traditional industries.

Crisis Management ( 12 % )

How has the company managed major issues in the past few years? Has it had to face a major crisis? How did it react ? ( 250 words )

The bisgest issue of BP during the past few years is the Deepwater Horizon oil spill. On 20 April 2010, the semi-submersible exploratory offshore drilling rig Deepwater Horizon (Macondo Prospect field in the Gulf of Mexico) exploded after a blowout; it sank two days later, killing 11 people. This blowout resulted in a partially capped oil well one mile below the surface of the water. The resulting oil slick covers at least 6,500 km2, threatens the coasts of Louisiana, Mississippi, Alabama, Texas, and Florida.

In the days after the accident, BP faced a complex and fast-changing crisis. With

oil escaping into the ocean, uncertainty grew around its ability to seal the well and restore the areas affected. This was an intense period, with the situation worsening almost daily.

The turning point is BP's meeting with President Obama on 16 June 2010, provided reassurance to the US government that BP would do the right thing in the Gulf. The Board of Directors focused on three critical objectives:

Ensuring the response team had the resources it required to stop the leak, contain and clean up the damage, and providing financial support to those affected.

There were about 48,000 people involved at the height of the effort. BP has set up a $20-billion fund to show their willingness and capacity to pay all legitimate claims for compensation. For the long term, they have committed $500 million to a 10-year independent research programme that will examine the environmental impact of the oil spilled and dispersants used. BP will continue to help restore the environment

and economy of the Gulf, however long that takes.

Resolving to understand what happened on and below the Deepwater Horizon, to apply the lessons learned and to make the findings available publicly.

BP's comprehensive internal investigation concluded that a sequence of failures involving a number of different parties led to the explosion and fire. They have established a safety and operational risk function, enhanced risk management through the restructuring of their upstream business. They are also conducting a wide-ranging

review of when and how BP outsources operations.

Moving to secure the long-term future of BP and their capacity to meet their financial responsibilities in the Gulf.

Decisive action was required because events in the US led to a crisis of confidence in BP within the financial markets. In response, the Board made the decision to cancel three dividends payments. This action steadied and strengthened BP's position at a critical point, although it affected small and large shareholders alike.

Result: BP's team stopped the flow of oil in July and completed relief-well operations in September.

If there has been no particular crisis related to the company, such as a product failure or damage to the environment, how has the company reacted to the economic downturn? ( 250 words )

Global energy demand is set to grow in the future. But in the short term, demand has been affected by the global economic downturn. Overall growth in energy demand in 2008 was only 1.4%, the slowest growth since 2001 [5] . At the same time the geographical pattern of demand is shifting, with energy consumption in highly industrialized economies having been overtaken by that of developing countries. For example, China alone accounted for nearly three-quarters of the world's growth in energy use in 2008.

Oil prices ranged from $36.55 to $78.86 in 2009, lower on average and less volatile than in 2008, reflecting the impact of the economic downturn and the markets' expectation of supply being able to meet demand over the short term.

BP believes the challenges of energy can be met through:

A broad and diverse mix of fuels and technologies, produced and used efficiently

Fossil fuels will continue to play a major part in meeting the energy challenges, providing a continuing role for BP's core business. They also have projects to produce hard-to-reach hydrocarbons, such as tight gas locked in dense rock formations, and Canadian oil sands. As the same time, They see an increasing role for natural gas and investing in finding and producing gas around the world.

They believe renewable and alternative energy will make up an increasing share of the mix. Therefore, they have invested around $4 billion since 2005 in low-carbon technologies with the potential to become material businesses for BP. In all aspects of energy production and consumption, efficiency is going to become more important.

Innovation in technology and partnerships at the frontiers of the industry;

They have a lot of experience of using cutting-edge skills and technology to undertake complex oil and gas projects in many of the world's most technically challenging and hostile environments, such as the Arctic and ultra deepwater.

Recent innovations include new technologies to increase recovery from mature oil fields and advanced seismic techniques that create highly detailed images of reservoir formations miles below the surface.

Strategy (12%)

How would you define the company's strategy over the past few years:

What markets has it focused on? ( 100 words )

BP has two major businesses: Exploration and Production that generates the most profit and Refining and Marketing that generates the most revenue. Although the group's activities cover a wide area across six continents, and its products are available in more than 80 countries, there are several key markets that BP has focused on:

Africa

The exploration and production activities is focused on Algeria, Angola and Egypt. The refining and marketing activities have a significant retail presence in Southern Africa.

Asia

The exploration and production activities are centered in China, Indonesia, Vietnam and Pakistan. China is also a center of chemicals manufacturing, (together with South Korea and Malaysia), Liquefied Natural Gas (LNG), and retail operations (together with India).

Australasia

The exploration and production activities in Australia and New Zealand are centred in Australia, where BP Solar is also a major marketer of solar panels.

Europe

The UK is a centre for trading, legal, finance and other mainstream business functions. The exploration and production business covers the North Sea - both the UK and Norway. BP have an important joint venture in Russia and are involved in a number of exploration and production projects in Azerbaijan.

BP retail sites are a common sight in several European countries. In Germany they market under the Aral brand.

North America

The BP group is the largest oil and gas producer and one of the largest gasoline retailers in the United States. In Canada, their activities focus on the production of natural gas and derivatives and we are currently considering a North American natural gas pipeline project in a joint venture.

South America

Exploration and production work is a core aspect of BP's presence in Colombia and Venezuela. In Brazil, their lubricants business has been operating for over 50 years, and aviation fuels have been sold to main airlines for 9 years now.

What are its core strengths? ( 100 words )

BP core strengths are technological innovation and leadership ability.

The new things delivered by BP change from year to year. But the value of innovation itself is a constant. They operate at the frontiers of geography, geology, environment and geopolitics. They could find and produce oil and gas in challenging surroundings from the Arctic to the Sahara, from the Gulf of Mexico to western Siberia. They have a dynamic and evolving technology program with 10 flagships. Their technology programs are commercially focused - designed to find new solutions to business problems.

BP's core strength in technological innovation even turned into distinctive strengths in deepwater, unconventional gas and EOR, and they have built a strong portfolio for the long term on the back of that capability.

BP's leadership ability is shown in the results of the business. Despite several changes in the CEO position recently (Tony Hayward replaced Lord Browne in 2007, and Bob Dudley replaced Tony Hayward in 2010), the group still can keep its performance in production and revenue. The leadership ability expressed its best in the quick recovery of the group after the Gulf of Mexico oil spill, when many were expecting a merge with Shell or Exxon-Mobil, or even a bankruptcy declaration.

Would you describe the company as innovative? ( 100 words )

Innovation matters because it is the main driver of human progress and development. In the context of energy, unprecedented levels of innovation are needed over the next several decades to provide solutions to growing global energy demand.

BP is an innovative company, and in fact 'Innovative' is one of BP's values [6] . Innovations are encouraged in most aspects of their business. In traditional activities like exploration, BP's technological innovations are aiming at improving the efficiency of current project, as well as exploring the hard-to-reach sites (in deepwater or under hard density rock). In sustainable energy, BP have been investing a lot to innovate solar, wind, and carbon capture and storage technology to diversify their energy portfolio.

Vision, Mission, Goals ( 12% )

What is the company's vision? ( 100 words )

Vision describe what the organization would like to become - management's strategic vision of the firm's future [7] . The following statement, although not titled as a 'vision statement', mathches the definition.

BP wants to be recognised as a great company - competitively successful and a force for progress. We have a fundamental belief that we can make a difference in the world. [8] 

What are its goals ? ( 100 words )

A goal is considered as an open-ended statement of what one wants to accomplish, with no qualification of what is to be achieved and no time criteria for completion [9] . The following statement can be considered as BP's goals:

We help the world meet its growing need for heat, light and mobility. We strive to do that by producing energy that is affordable, secure and doesn't damage the environment. [10] 

How does it motivate its employees? ( 100 words )

Providing a work - life balance environment.

There are a variety of flexible working arrangements such as part-time and flexible hours, depending on employees' role.

There are occasions when people have to work very hard and unsociable hours. When this happens, BP considers whether it might be appropriate to provide extra time off and/or other additional benefits.

BP supports a range of family friendly policies (such as career breaks and adoption leave) aimed at allowing people to contribute to their families without compromising their professional development or career aspirations.

Promoting diversity

BP establish a platform for creativity, innovation and problem solving by valuing the differences among people. They are committed to a culture of diversity, which helps attract, develop and retain talent.

BP try hard to ensure their selection and assessment processes are free from bias and that they offers everyone access to opportunity.

Offering competitive reward packages and linking pay to performance

The group's top performers are receiving industry-leading bonus rates. BP also offer people the opportunity to learn, grow and contribute.

Desirability as an employer ( 6% )

Would you like to work for this company and why? ( 100 words )

I personally would like to work for BP. First and foremost, working for one the world's biggest corporation is a good opportunity for anyone. Since BP hires many talents, working with such team mates can help me greatly improve my professional skills in many fields. Moreover, the oil industry is very competitive, which makes BP change a lot in both technology and management. It in turn helps me to increase my knowledge of many new things. Finally, with more than twenty job categories, I may find some opportunity to build my own career - either sticking with BP in the long term or preparing myself for a better start.

Part 2:

1.Critically discuss the contention that ' leaders are born not made' ( 500 words )

Are leaders born or made? That is one of the most difficult and frequent question has been asked many times but it has a lot of opposite opinions. Many say that leaders are born not made, they think leader skill is innate, people who are not own that skill can not be a good leader. But the other are think differently, they believe that leader can be made by training process.

To begin with, let's define what is a leader? A leader is a person who guides others toward a common goal, showing the way by example, and creating an environment in which other team members feel actively involved in the entire process. A leader is not the boss of the team but, instead, the person that is committed to carrying out the mission of the Venture. Below are some qualities a strong leader may possess. The sixth president of United State has a sentence "If your actions inspire others to dream more, learn more, achieve more, you are a leader".

There is the leadership trait theory which points out that people are born with certain character traits or qualities. Since certain traits are associated with proficient leadership, it assumes that if you could identify people with the correct traits, you will be able to identify leaders and people with leadership potential. Most of the time the traits are considered to be naturally part of a person's personality from birth. From this standpoint, leadership trait theory tends to assume that people are born as leaders or not as leaders.

There is a lot of value in identifying the character traits associated with leadership. It is even more valuable to identify the character traits that followers look for in a leader. These traits would be the characteristics of an individual who is most likely to attract followers.

Leaders are also had two sides: good side and bad side. For example, Ho Chi Minh President is a good leader. When Vietnam was being dominated by France colonialism, he tramped about abroad through thick and thin for 30 years in search of a way to save the country. His contributions have helped a large part of Vietnam's victory in the resistance war against French colonialists and in the anti-American resistance war. His way of doing things earned him respect and admiration from Vietnamese people and people of socialist countries.

Adoft Hittler is an example of bad leaders. His selfish style leading and dictatorship, in additions, his ambitions are to conquer other countries to make all of the world is Germanie's. Moreover, Hittler propagandas Racism to the black and the Israelite, he has muderred a big deal of people. All of things above make him a bad leader.

The book The Leadership Challenge identifies 20 character traits that are generally associated with good leaders. The top five traits are: honest, inspiring, forward-looking, competent, and intelligent. It is easy to understand that people likely love or admire those who possess these traits, hence are willing to follow them. Moreover, traits such as honest and inspiring allow one to behave people very kind, hence he or she can win followers' loyalty.

Although being under many criticism, the contention that ' leaders are born not made' seems to be correct in many circumstances. Managers are very easy to train, or 'make', but for a leader, certain traits can make many differences.

2.The best way to ensure constant innovation is to hire young, newly - graduated candidates with an interest in innovation and set them up in a think - tank, separate from the main organization - so they can develop new ideas unimpeded by the existing business. ( 500 words )

Bringing an organization to success is difficult, but retaining it at the achieved level and having continuos success is much harder. To ensure the long-term development of organizations, constant innovation is a key. A constant attempt at innovation, both in terms of product and service, holds the key for success of business in a competitive world.

The best way to ensure constant innovation is to hire young, newly - graduated candidates with an interest in innovation and set them up in a think - tank, separate from the main organization - so they can develop new ideas unimpeded by the existing business. Most young, newly-graduated candidates want to contribute their best efforts to the organization. They have many dreams and are anxious to make them come true. That high working morale is often hard to find in old employees, who has been working for the organization for 5 years and more. It is the motivation for innovation. Of course, an interest in innovation is a must.

A think-tank is a special unit that conducts research and engages in advocacy such as policy, strategy, science, technology, and advisory. A think-tank is the place dedicates for innovation, from the environment of similar people to all the settings that serve the special purpose. In a think tank, young candidates have every facility they needs to maximize their brain power and contribute their best to think about innovative ideas and make them come true. Moreover, with all the expertise available in the think-tank, plus the guide of experience experts, innovative ideas are guided to aim to special purpose that serve its main organization best. For example, Economic Research Institutes gather only talents that are interested in innovation of that field, and are funded to research and advice government economic policies only.

The reason to set a think-tank separate from its main organization is to keep the mind of people in the tank fresh. Most of the time, the work of a think-tank is research. One of the most important requirements for academic and scientific research is objective. To be objective in both methodology and findings, researchers should be separated from the subjective ideas of the main organization so that they are free from interference. Another reason is that organization usually has its own mind set, may be because of a strong culture, conservative people, or just lack of motivation to think about new ideas. If the think-tank is set as a sub-unit within the main organization, the big mind set of the whole organization will affect the innovative strength quite a lot. And the last reason to separate the think-tank from the main organization is that young, newly-graduated candidates should be preserved dedicatedly for research. There may be times that an organization's unit has to do tasks outside of its scope by some special need of the management. When this happens, people in the unit are distracted, hence the efficiency of the research tasks will be lower, or even cause the research to fail. Therefore, setting the think-tank separately from the main organization help increase the efficiency of innovation process.

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