Industry Analysis - Application to the Oil Industry Case Study

Industry Analysis - Application to the Oil Industry - Case Study Example Suppliers play an imperative role in the success of any business. As such, a supplier may affect the profitability of a company either positively, by boosting it or negatively, by reducing it. This is what forms the power of suppliers. A supplier has powers to determine the profitability of a company, and in the case of the oil industry, the suppliers of BP can either assist it to become more prosperous and productive or to lose their market and make losses. This stems from the fact that suppliers agree to supply their products to the company at a certain given market price. If they increase the price at which they sell their products to the company, this will reduce the profit margin of BP, and the lack of alternative suppliers, as well as the strong power of the suppliers will bring the profitability of the company down. On the other hand, these suppliers can equally boost the profitability of the company by supplying it with product at a low cost, thereby increasing the companyâ⠂¬â„¢s profit margin and hence boost its profit levels. As such, it is imperative for BP to make the right choices of suppliers in order to secure a significant profit margin. BP sells its products to a wide range of customers. These people bring profit to it by purchasing its petroleum products. Its major customers include airline companies, governments, as well as ordinary motorists and companies. The bargaining power of these buyers is not as strong enough as to influence the selling price as set by BP. BP has sales points in many regions across the world, bearing the fact that it is a global multinational, and it has control over its buyers in almost all of its markets. It is only in some minor occasions where the governments within the markets in which it operates step in to regulate the fuel prices in the country generally, thereby also setting the price limits for the petroleum products sold by BP. However, this only strengthens the bargaining power of these customers to a considerable level, not strong enough to affect the profitability of the company

Peter ducker Essay Example | Topics and Well Written Essays - 2500 words

Peter ducker - Essay Example Management can survive only through superior competence and continually improving performance. Drucker has emphasized the importance of role of management not only in business but also on political state of affairs of many countries. He asserted that only management can help most of the countries to come out of their economic and/or political struggle and build their economies. Drucker’s seven key elements, as described by Hutton and Holbeche, (Drucker, 2007a) that influenced organisational thinking and practice to a large extent include, scientific management as the key to productivity; decentralization as the basic principle of organisation; personnel management as the orderly way of fitting people into organisation structures; manager development to provide for needs of tomorrow; managerial accounting for use of analysis and information as the foundation for firm decision-making; marketing; and long-range planning (Drucker, 2007b). Drucker’s philosophy of management was based on five basic principles: setting objectives, organising, motivating and communicating, establishing measurements of performance, and developing people and self. Drucker refers to these principles as manager’s responsibilities. However, some of these principles have been criticized by others. For example, Parkinson argued that some of Drucker’s principles are vague and others are still to be defined. He also felt that Drucker’s ignorance of a specific issue/problem seems greater than his knowledge. Some of leading management theories of the 20th century contributed by Drucker include, management by objectives; putting the customer first; the role of chief executive in corporate strategy, and structure follows strategy. Drucker proposed the theory of the business, in which he contended the fact that businesses are run on a