Assignment On British Petroleum

This Paper will concentrate on the organisation known as British oil typically referred to as British petroleum. This reason for this paper would be to examine and evaluate and analyse the present proper position of British petroleum inside the industry also once we proceed further we shall also consider the environment analysis, structural determinants from the concentration of your competition, structural analysis and competitive means of British petroleum, The entire paper continues to be split into three parts, simply one we consider the general analytical techniques like SWOT, PESTEL, suggested by M.E porter , latter simply two British petroleum is going to be analysed within the light of ansoff matrix and BCG matrix, and also the porters five forces, the ultimate part includes suggestions regarding the above mentioned analysis

Introduction :-

“BP is among the world’s leading worldwide gas and oil companies, supplying its clients with fuel for transportation, energy for warmth and lightweight, retail services and petrochemicals items for everyday items”

http://world wide web.british petroleum.com/sectiongenericarticle.do?categoryId=3&contentId=2006926

British oil well referred to as British petroleum is world’s major gas and oil company, it is among the the world third biggest company (source Wikipedia: http://en.wikipedia.org/wiki/British petroleum) it’s well know brand worldwide, as well as in business realm it’s much referred to as a corporation that has been positively taking part in vertical integration approach in each and every section of fuel industry, which includes excavation of oil and extraction and production refining distribution energy generation and buying and selling, lately British petroleum continues to be positively including in the introduction of alternative energy assets because it is thought through the finish of the century all of the mobile phone industry’s reserves of conservative fuel deposits will vanish, however British petroleum has its own operation going through in 80 different nations and created roughly 4 million barrels of oil, Bp’s biggest maket share is within u . s . states mind quarted in Houston, the organization continues to be alleged for that threat of environment and safety concern following a recent spill in gulf, British petroleum may be the first company to understand the the long run interest in energy is anticipated to improve by 50% with within the next 2 decades as well as on the British petroleum website it’s mentioned the 85% from the energy demands is going to be met through the non-renewable fuels

Medicare Part A:-

British petroleum SWOT ANALYSIS:

Talents:

BP’s History/brand:-

British petroleum Among the mobile phone industry’s well know brand that has been operating in the industry forever from the 1800s but formally referred to as Anglo- Iranian oil company , its history itself dictates its stability with in the industry, it includes a strong holds within the u . s . states market among the biggest consumer of gas and oil on the planet also

Bigger producer within the Gulf:-

As British petroleum is has its own strong root hold within the American market the organization features its own refining market and distribution channels thus it features a unique and formidable infrastructure, with the network of their subsidiaries making rivals daunting

Geographically diverse organisation:-

British petroleum continues to be operating in 80 different nations worldwide under different names like Amco, Burmah Castrol, British petroleum express, Arco, British petroleum connectAnd so on. British petroleum also indexed by NSE and FTSE and LSE. however British petroleum amco is among the most powerful brand among the rest of the brand that British petroleum works

Leadership in oil related technology:-

The oil related technology is understood to be “Oil production related technology might help maintain revenue and profits by providing the controlling firm the opportunity to increase production on new oil fields. Superior technology also enables better usage of existing oil reserves from the production and refining capacity” Source: (http://world wide web.wikiwealth.com/swot-strength:superior-oil-related-technology) using the definition above that British petroleum has acquired an aggressive edge among its other rivalries in growing producing new oil fields

Concentrate on Conventional oil :-

“On february 2007 the organization has introduced it might be investing 8 billion dollars within the next 10 years within the research of numerous alternative techniques to search the conventional energy resources” source (http://en.wikipedia.org/wiki/British petroleum#History) British petroleum has over checked out the fuel crisis thats likely to arise in in the future therefore it has transformed its logo design to Helios as one example of it corporate social responsibility thus by attaining the client confidence around the brand, this campaign had been based on slogan known as “BP beyond petroleum” Michael. E. Porter ” emerging industries are recently created or cool industries which have been produced by technological improvements, that elevate something new or service to the stage of potential viable of innovations” pg 215 . Thus based on M. E porter using unconventional energy is definitely an emerging market where British petroleum makes extensive efforts to achieve the edge against your competitors. Also we will be talking about the likely methods that British petroleum can consider , once we proceed in to the next parts of this paper

Weakness:-

Negative consumer perception:-

Though British petroleum continues to be striving difficult to position British petroleum like a environmentally friendly brand, the current occurrences has put British petroleum customers on dilemma concerning the brand positioning, because of recent spills in Alaska and gulf, also British petroleum has elevated it gas prices in in comparison to the rivals

Unstable Oil industry:-

Industries for example oil are in the stake because of their availability later on , however oil market is higly lucrative , additionally, it suffers unpredictability which decreases ale opportunities in the traders

Possibilities:-

Energy independence: –

since 8 billion dollars continues to be invested into research of conventional powers and alternative fuel techniques, you will see more possibilities developing within the fields of photo voltaic wind and gas energy

Growth of areas:-

British petroleum can consider growth of its edges to appropriate oil reserves and through purchase of gas and oil industries within the north ocean along with other areas globally

Prices and quality:-

British petroleum may also reconsider by flexing its prices policy to be able to answer the challenging competition, supported by very same top quality of fuel

Risks:-

Instability:-

Many BP’s oils creating regions are facing with unstable government making business much more volatile

Oil Spill:-

British petroleum continues to be alleged to be undertaking environment hazard activities in oil excavation following a spills in Alaska and Mexico, too a some periodic fire accidents within the British petroleum oil rigs, corrosion within the oil pipe lines can also be appearing a significant threat to the organization

Saturation of assets:-

Natural saturation of assets within the oil wells could be another major threat towards the company’s existence

PESTEL Analysis :-

M. E Porter has recommended a frame work known as pestel analysis in understainding the forces within the macro atmosphere G. Schools and Remedy states that “understanding how PESTEL factors might effect on and drive alternation in general is a great beginning point” pg 66

The word PESTEL means political , economical social technological environmental and legal these forces have affect on the organisational exterior atmosphere

POLITICAL

• As talked about above because of unstable government authorities within the BP’s production nations the mobile phone industry’s energy marketplaces are becoming more volatile

• Due to climatic change issues and weather disturbances government authorities are coming up with a powerful obstacles on oil excavations, besides encouraging such industries into discover more sustainable types of energy

• On whole the worldwide energy marketplace is increasingly volatile because of ongoing oil demands in the under developed nations

ECONOMIC

• The economy is based on the power reserves for the reason that country

• ” The interest rate of worldwide economic recovery supports the answer to energy prospect to next several years” (IEA. 2010 details sheet )

• Energy marketplaces can envisage demand increase by nearly 60 % based on IEA

• Due substantial increace within the alternative powers supply are required to develop within the next couple of decades quickly

SOCIAL

• Based on the Kyoto protocol, charge of the CF(swimming pool water fluorine) carbon pollutants has turned into a legal requirement

• More attention continues to be attracted for the concerns on sustainability for the future though this might appear just a little impact right now because of unavailability of manufacture of cheaper types of renewable power for example photo voltaic and wind energy

TECHNOLOGY

• This pressure is probably appears to become a significant driver of alternation in the worldwide energy market because it is being underpinned with a technological developments of manufacture of economical methods for renewable power

Part 2:-

The Ansoff Matrix :- the ansoff matrix is really a 2×2 matrix with items market mix for existing and new marketplaces , it was initially suggested by H. Igor Ansoff, it’s a growth marketplaces matrix helps the organisation to consider its proper decision it may also help us to analyse how British petroleum has varied itself from British oil to beyond oil

http://tutor2u.internet/business/strategy/ansoff_matrix.htm

Existing product

Cool product

Existing market Market transmission

This requires British petroleum stretching its physical frontiers, more retail shops, direct distribution etc Product

Bio-fuels which are created inside a sustainable way, and solar power wind energy etc

New market Market development

Marketing and advertising flexing the prices policy in United kingdom and obtaining person possessed retail shops in prime locations

Diversification

Neat and renewable solar power for houses, streets and companies

Use of ansoff matrix to the current organization:-

Market transmission:- British petroleum includes a obvious and focused strategy in market penentration using its varied items for every single market segment like houses business as well as varied items like lubrication motor oils etc can also be found to aid its deliberate strategy into market transmission

Product:- this tactic is better applied whenever a particular service or product is within maturity or perhaps a decline stage however because of global environment fuel crisis it is essential to search for any new energy assets, however this proper approach give an edge against your competitors towards the organisation like bio fuel through sustainable sources, thus British petroleum has switched its marketing tag from British oil to beyond oil IEA 2004, also predicted the future energy supply is going to be from renewable assets

Market development:-

British petroleum continues to be strongly and readily using the forex market strategy, because it is presently operating in 80 different nations, also as part of further market development, British petroleum hold its very own distribution channels besides getting dealer distribution channels, lately in India, British petroleum has specific a brand new demographic group ie., CNG( compressed gas) for domestic reasons, By which British petroleum has acquired a substantial share of the market. However, still there’s a lots of space to develop in this region by growing more into Africa and Russia and Europe

Diversification: –

Although diversification is definitely an very dangerous strategy, to secure BP’s future British petroleum has invested 8 billion dollars in the introduction of economical methods to produce renewable and alternative powers, as you will find some speculations that solar power is going to be utilized more by 50% than its present usage (data monitor 2004). To be able to gain knowledge of this sector of one’s production british petroleum has invested this type of great deal, to restore its deficits because of recent oil spills. British petroleum has acknowledged the significance of diversification strategy, when the expertise is acquired then it’s really a market leader by selecting emerging industry marketplaces entry methods

BCG Matrix :

Cash Cows

British oil includes a large share of the market in gas and oil industry using its wings extended in 80 different nations, however, these SBU are rich in share of the market with less room for that growth because it is an adult market, these SBU have to be handled well with right technique to keep up with the profits

STARS:

British petroleum is presently well-established in many of their operating nations however, there’s still room to develop to stars because it the 4th biggest when it comes to revenue making then royal Nederlander and Exxon Mobil (cnn, 2010)

(http://money.cnn.com/magazines/fortune/global500/2010/full_list/)

QUESTIONMARKS:

British petroleum is attempting to head to new marketplaces by trading into sustainable and alternative energy assets, because it has small be part of high growth market because it is predicted that marketplace for these renewable powers were prone to rise quickly Also BPs CNG items could be another question mark because it has high growth which may be changed by gas within the developed nations

DOGS:

British petroleum business could be effected by electrification of rail transport within the under developed nations, Wherever British petroleum is working in. Because of the marketplace for delivering diesel to locomotives are in the dog’s condition, since it has relatively low growth and small share, which market might sooner vanish. However British petroleum can continue this present SBU, because it cannot modify the other SBUs

British petroleum includes a stable share of the market inside a unstable market, regardless of the facing accusations from recent gulf disaster

Part 3:-

Recommendations for British petroleum because of its entry into emerging energy industry:-

Michael. E. porter (1980) recommended a few of the common early obstacles like

• Proprietary technology

• Access to recycleables along with other inputs

• Risk, which boosts the effective chance price of capital there by effective capital obstacles

Proprietary technology:-

British petroleum may be the first company to recognize the necessity to invest into growth and development of new methods to produce energy it’s invested 8 billion dollars to build up and posses the brand new technologies being produced of wind and solar power

Use of recycleables along with other inputs:-

Although the inclination of the particular barrier may not appear appropriate to BP’s manufacture of wind and solar power because they are freely and abundantly obtainable in character however British petroleum still can gain competitive advantage by arranging the copy privileges from the technology that’s being/is going to be accustomed to convert the choice assets into energy. Thus producing revenue

Risk:-

Typically established information mill frequently not the first one to maintain the brand new emerging industry due ot technological advancement even getting the abilty and apparent talents , but climb this guitar rock band wagon latter, and attempts to establish by placing high greater chance cost, within this situation British petroleum has some relatively apparent talents like understanding from the clients and brand strength, so it’s advisable that British petroleum still press by trading into research of other fuels

PORTER FIVE FORCES

Brendan Examining the competitive atmosphere – 5 Forces Framework of Industry Analysis

British petroleum: An analysis while using Five Forces Framework

Industry Competition

British Oil (British petroleum) works within the energy industry. You will find only a small amount of firms inside the energy industry. It is really an oligopoly market – you will find a small amount of producers taking pleasure in a sizable share of the market. The oligopoly market structure is really a fundamental driver of BP’s profit increasing operation. British petroleum and it is rivals can make abnormal profits because of the marketplace structure that they compete. There’s mutual interdependence between companies within an oligopolistic market structure. BP’s primary rivals are Exxon Mobile, Total SA, Chevron, ConocoPhillips and Royal Nederlander Spend.

British petroleum can make abnormal profits like the method in which monopolist operate. A strong like British petroleum might not be fully efficient nonetheless they remain in a position to survive because of high obstacles to entry within an oligopoly market. Bain (1956) referred to obstacles to entry as factors which permit established firms within an industry to earn supernormal profits without bringing in entry. An oligopoly structure is characterised by high interdependence between rivals. The choices of British petroleum are heavily based on the choices of the rivals.

Just how does British petroleum remain competitive on the market when they cannot take market leadership? Area of the answer lies using the dependency of competitor choices as well as an lack of ability to consider an expense leadership strategy. The possibility of taking this kind of strategy could induce a cost war and lower profits. If BP’s rivals decrease fuel prices then British petroleum will most likely lower their cost to prevent losing clients. If however a strong decides to boost prices then it’s rivals is going to be unwilling to follow. For this reason costs are regarded as ‘sticky’ – as prices are usually resistant against change.

Sticky cost levels could be described with a ‘kinked’ demand curve produced by Hall and Hitch and Sweezy (1939), proven in figure 1.1. The kink reaches cost P. Any rise in cost above P can lead to a far more than proportionate fall in quantity required as customers tends to buy using their company firms who haven’t elevated their cost. Over the cost P the cost elasticity demand is greater and much more elastic. Home loan business cost below P demand becomes inelastic and fewer prone to a big change sought after.

Because of the tight oligopoly market British petroleum compete inside it seems that British petroleum they may be colluding using their rivals on prices. The items they offer are extremely homogenous, the cost elasticity of demand is low and you will find high obstacles to entry, creating ideal conditions for collusion. Oligopolists are ‘circular dependent’ (Lipczynski and Wilson 2001). How much transparency regarding cost is high, which allows British petroleum and it is rivals to consistently match the cost of the leading member. Scherer 1996 describes this as ‘collusive cost leadership’. By colluding on prices you’ll be able to earn abnormal profits. The best choice functions like a ‘barometer’, whose cost bulletins reflect market demand and supply conditions (Scherer 1996).

“‘I’ (an oligopolist) cannot define my favorite guidelines unless of course I understand ‘You’ (my rival) are performing at the same time, however, you can’t define your very best move unless of course guess what happens I’ll do” – (Asch 1964, p.54).

Threat of recent newcomers

The mining, gas and oil industry is among the most lucrative. The Worldwide 500 ranks British petroleum the fourth most lucrative. Why exist only numerous firms within the energy industry taking pleasure in abnormal profits and total share of the market? Generating high profits generally draws in new newcomers, however new newcomers can experience obstacles to entry preventing them from entering the marketplace. You will find no obstacles to entry in perfect competition marketplaces, new firms can set-up and then leave with relative ease. It’s not as basic for brand new firms to create-in an oligopolistic market. You will find several obstacles to entry stopping firms from doing this. Bain describes obstacles to entry as factors which permit established firms within an industry to earn supernormal profits without bringing in entry.

Among the biggest obstacles to entry for brand new firms may be the great deal of capital needed to create-up in the market highlighted by figure 1.2. The price to a different firm could be much greater compared to average costs of existing firms. Another barrier to entry is BP’s up and down integrated structure. They’re involved completely across the logistics, from finding oil deposits, drilling and removing crude, refining into oil items, disbursing and selling at British petroleum possessed retail store franchisees, further denying use of new newcomers. They could make profits across the logistics, known as upstream and downstream profits. Vertical integration exclusions could be categorised as limited practice, for example limit prices cost methods (Lipczynski and Wilson 2001).

Financial systems of scale prevent new newcomers attaining access in to the market. British petroleum is definitely an established, global organisation in the market which in a position to source, extract, refine and distribute oil in a reduced cost in comparison having a small start-up firm establishing on your own. At greater amounts of output a vertical integrated firm for example British petroleum can specialize in factors of production within the entire product existence cycle, in the exploration and extraction of oil (upstream) to distribution refining and selling gas (downstream) to customers through many that belongs to them retail shops.

Trade obstacles are reduced the fuel retail market. In the beginning approximation fuel merchants seem to fall under the monopolistic competition category Scherer (1996). However, it’s important for merchants to know those things of the rivals. Machlup describes fuel merchants inside a neighborhood as ‘chain oligopolists’. Gas is definitely an inelastic good, a sizable alternation in cost won’t change quantity required. To be able to lessen the uncertainty with prices, fuel merchants collude on prices. This can help these to gain the very best profit and might help to avoid one merchants missing out.

For instance, imagine you will find two merchants A and B on opposite side from the road. If Your drops its fuel cost, B will loose out if he doesn’t mirror the cost of the. Selling fuel in the lower cost can lead to both A and B making less profit. By colluding on the set cost, it’s possible for A and B not to loose out. This really is known as duopoly ‘tacit collusion’ and is comparable to Cournot’s type of oligopoly. There’s however, the temptation for just one firm to interrupt the guidelines, or cheat by lowering cost underneath the agreed level to be able to gain competitive edge on rivals, which can lead to a cost war.

The threat of recent entry appears within the oil market appears unlikely for the short term. You will find a number of very large oil and companies who dominate the which take advantage of financial systems of scale, vertical integration and incredibly high obstacles to entry. The resembles a monopoly as rivals co-operate to savor monopoly style profits, further restricting new newcomers.

Possibly the threat of recent newcomers may promote themselves with the introduction of new fuel technologies as gradual fossil fuel demand declines. With ever growing pressure from government and pressure groups, combined using the depletion of world oil reserves, eventually you will see a change from oil consumption as supplies go out and new fuel options be a more appealing. Figure 1.4 shows the extraction of oil once we transfer to the long term. The cost will rise progressively with time as supply dries up. Conscious of this issue, British petroleum in 2007 selected the College of California, Berkley to guide a $500 million energy research programme. The programme will build up new sustainable technologies for British petroleum. By diversifying British petroleum continues to some primary player in the market getting into the long term. British petroleum has additionally pledged to take a position another 500 million over ten years to finance bioscience research programmes for brand new and cleaner energy development.

Threat of substitute items

Oil is really a scarce commodity that’s greatly sought after. The planet is dependent on oil and presently you will find very few viable substitutes for oil presently available. With large nations for example India and china quickly growing the issue will simply worsen. The present options for fuels include coal, LPG (Liquid Oil Gas) both non-renewable fuels and hydrogen (which requires using

fuel to create).

Beyond these options there’s wind energy, photo voltaic energy, geothermal power energy and nuclear energy. British petroleum Most of the substitutes for oil for example LPG already are written by British petroleum. British petroleum appear ready for just about any potential risks from potential innovative firms entering the marketplace, partially because British petroleum have considerable amounts of investment already in research and development.

Negotiating energy of purchasers and providers

Customers buy oil items from British petroleum possessed fuel merchants. The merchants purchase their fuel from British petroleum, who extract and refine crude from the 3 that belongs to them locations around the world. Effectively British petroleum doesn’t have providers, because they supply themselves, even though they are subject to the marketplace cost of oil. The cost oil is dependent upon the availability of oil, mainly in the cartel of OPEC – the world’s 13 biggest oil creating groups. By being employed as a cartel the oil creating nations (who depend heavily on oil revenues), can manipulate the cost of oil by growing or lowering the availability of oil. British petroleum needs to market oil to the merchants in the market cost which is passed onto customers. The cost of oil affects the entire logistics. British petroleum along with other rivals make bigger profits once the cost oil is high, once the cost of oil falls, generally customers take advantage of affordable prices in the pump and oil producers make more compact profits or even manages to lose. Figure 1.5 demonstrates an increase in prices when supply is fixed by oil providers.

The negotiating energy of customers as purchasers is extremely limited. They’re subject to the chain oligopolist merchants who collude on prices, following barometric cost level based on the marketplace cost leader.

Although British petroleum is really a large firm they’re small in comparison to large oil creating nations for example Saudi Arabia. Principle nations for example Saudi Arabia are capable of take dominant firm cost leadership. They could do that by working together using the OPEC cartel modifying output levels to help keep prices high. This really is known as joint profit maximisation, although there might be a inclination for nations inside the cartel to cheat – or increase output to be able to earn more money.

The cartel prices strategy is effective if all gamers stay with the guidelines and offer the correct amount agreed through the cartel. This really is highlighted by figure 1.6. The cartel enjoy cost PCartel in the quantity QCartel. If your player decides to cheat and convey more oil he is able to privately sell more oil at quantity QCheat and also at a lower cost PCheat. Nations smashing the rules may pull it off for some time, however eventually the marketplace will react to the additional output and a decrease in the cost of oil will result.

Government

The function of presidency plays a huge role to managing the quantity of profits caused by sales of oil.

Windfall taxes were created by the work government in 1997 on utility and companies for example British petroleum so that they can lessen the development of the lately privatised industry (BBC News [online] 31 The month of january 2008).

Throughout 2007 the cost of the barrel of oil arrived at $147. Companies for example British petroleum recorded a 6% increase in profits. Unions known as for any windfall tax on British petroleum along with other producers. British petroleum contended they are already ‘one from the biggest taxpayers’ (BBC News [online] 29 This summer 2008). British petroleum also contended the cost of oil is occur the relatively free market. Others state that even OPEC can perform little concerning the control on oil prices any longer.

Restrictions while using Porter’s Five Framework

You will find many exterior forces affecting the competition inside a market. Competition varies in various marketplaces. Porter’s ‘Five Forces’ model helps organisations understand industry structure and shapes the competition that is a result of competing in various structures. It’s important for firms to fully understand market structure that they operate (Worthington et al 2001). An analysis of British petroleum while using five forces framework presents numerous problems. The model doesn’t think about the macroeconomic atmosphere, especially as British petroleum is really a global player. Political and legalities have to be considered. What’s the current legislation concerning cartels, monopolies and move rules? Similarly economic and technological changes are important for an organization for example British petroleum, always searching toward the long-term. An excellent illustration of financial aspects factors affecting British petroleum may be the current economic recession that has drastically reduced the interest in oil and company profits.

Even though the oil industry presently seems to become a relatively stable for profitability, there’s without doubt that eventually you will see a change from oil. Jergin identifies a big change will come by means of a significant technological breakthrough in alternate wind turbine or possibly from an environment crisis, diminishing oil’s importance. In either case Porter’s framework does not identify a few of these key issues. If used properly the model may be used perfectly, although if use wrongly, without thinking about underlying forces, then it may be meaningless.

British petroleum, a hundred years-old global gas and oil company has experienced numerous major problems recently. Evaluation from the business structure and company culture at British petroleum clearly determines its significant responsibility like a cause of these problems. Presently British petroleum reaches the purpose of no return. Aggressive action through the board of British petroleum in structure and culture may salvage this proud old company. This evaluation identifies the weak points of things as they are while offering possible a potential solution.

A company culture isn’t developed overnight. Based on Entrepreneur Media, Corporation. (2011), it’s a complex “blend from the values, values, taboos, symbols, traditions, and misconceptions that companies develop overtime” (Corporate Culture, para. 1). One Hundred-year-old company like British petroleum is promoting its culture from the leaders, its achievements and failures, and also the road it’s traveled. British petroleum has compounded that by getting together through acquisition and varied global regions of operation the cultures of others and lots of nations. British petroleum must change its culture if it’s to outlive (Shefrin, 2010). Cultural change is going to be investigated from both a theoretical along with a practical approach. The business style of a business could be transformed to attain some goals, however the change are only effective when the culture is properly transformed too.

The culture and structural change doesn’t seem to get the greatest priority it requires. Bulletins are hidden in releases offering resumption of dividend obligations, significant increases in exploration budgets, along with other financial products (Dudley, 2011). The discharge from the British petroleum annual report for 2011 triggered an exam of this report by various investor groups. The Christian Siblings Investment Services reported on their own assessment simply the following:

Traders were built with a fair expectation of robust and substantive disclosure around the means by which risks are and will also be handled. Traders also expected more in depth disclosure concerning the company’s strategy, including short- and lengthy-term objectives and goals, relevant to BP’s role in avoiding catastrophic global warming. BP’s 2010 Annual Report should be seen as incomplete during these respects (as reported in Kropp, 2011, para. 3).

BP’s annual meeting of came bad weather of protesters with 25% from the voting from the re-election of BP’s safety committee, a damning indictment from the recent record of accidents (Webb, 2011).

Summary and Conclusions

BP’s culture and means of profitability culminated in a number of problems at that time 2005 to 2010, most lately this years British petroleum oil spill. BP’s problems have triggered huge financial deficits for that corporation together with a total pre-tax control of $40.9 billion this year with regards to the accident and spill (Svanberg, 2011, para. 10). Stakeholder outrage in the British petroleum management has tried to resolve the problem by marketing greater safety awareness. However, a radical corporate cultural change is considered necessary and also the corporation’s actions up to now don’t appear to possess accepted that require. Unless of course the culture is transformed the long run outlook for British petroleum is dismal.