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Introduction to Strategic Management

Strategic management is linked with the aspect of setting objectives of the business keeping in view all the resources which are required in order to operate efficiently in the market. Further, with the motive to operate efficiently in the market it is necessary for every enterprise to analyze the overall industry in which it operates so that overall actions can be taken accordingly. Apart from this, to enhance market performance firm has to carry out internal along with external analysis as through this accomplishment of desired aims and objectives becomes easy and it is fruitful for the business in every possible manner. Further, environmental scanning directly provides base to company in identifying the range of challenges being present in the external environment and how it influences productivity of the company. For conducting the present study organization chosen is British petroleum (BP), it is one of the world’s super major oil and Gas Company. Headquarter of this organisation is located in London, England. Major activities of the business also include gas production, refining, distribution and marketing work. Business is having high presence at global level and majority of the customers prefer to access its services. Various tasks have been covered in the report which involves industry structure, environmental scan etc.

Industry Analysis

1) Industry structure

British Petroleum operates in petroleum and gas sector where market size is quite wide and this in turn allows business to operate on wider platform. In the year 2014 the oil and gas industry of UK produced 1.42 million boepd of which 59% was oil and liquid. Further, 98% of the production comes from the offshore fields. Oil and gas members of UK expect between eight and 14 exploratory wells to be drilled. From the survey carried out it has been determined that it will increase due to rise in level of cost along with projects over run. Overall the annual investment can be low as £2.5bn within three years. During the year 2014 production of oil and gas fell by 1% and the opportunity cost has risen by 1% in the same year. Apart from this, the worldoil prices has been fairly stable. On yearly basis overall size of industry is increasing at faster pace and this is contributing in development of the companies operating in this sector. Apart from this, large numbers of companies are expanding operations in this sector as there are able to identify the range of opportunities present in the market which is fruitful for them in long term. No doubt, challenges are also present which prevents businesses from accomplishing desired aims and objectives. Therefore, with the help of this it can be stated that structure of UK oil and Gas industry is quite favourable and it is contributing in success and growth of companies like British Petroleum etc in the market.

Oil and gas sector and its main competitor is shell. Further, majority of the businesses focuses on product development as a strategy and due to this basic reason they are able to survive in the market for longer period of time. Apart from this, due to rise in level of competition British Petroleum has to modify its product range timely and additional benefits are provided to the customers who prefer to purchase services along with products of British pertroleum. So, this also contributes in the growth of organization and directly leads to accomplishment of desired aims and objectives. Without employing this type of strategy it is not at all possible for British Petroleum to operate efficiently in the market and it can directly lead to decline in level of overall performance. Apart from this, British Petroleum considers other attributes such as quality of the oil etc at the time of offering products to its target market and this leads to higher satisfaction level which is also considered to be one of the main target of business. British Petroleum analyzes strategy of each and every competitor such as Shell etc so that its market performance can be easily enhanced with the help of this (Hyde, 2014). Moreover, product development along with other type of strategies undertaken also contributes in enhancing market share of the business up to extent. Therefore, strategic group analysis has shown favorable results and it can be easily said that British Petroleum is efficient enough to meet with the requirement of target market and this is supporting business to sustain in t