STRATEGIC ADVANTAGE

The Strategic Advantage

History and culture of British Petroleum2

PEST Analysis2

Political Factors2

Envirnomental Factors3

Social Factors4

Technological Factors4

Factors that BP Took into Account for its Long-Term Sustainability5

Strategic approaches to BP for long-term competitive advantage in this industry6

The SWOT Analysis6

Strengths7

Weaknesses7

Opportunities8

Threats8

Tony Hayward's quote at the end of the case and the disaster is strictly a BP failure of an industry9

The factors affected the competitive environment of the oil industry11

The most insignificant decision-making strategies of British Petroleum and its seniors12

The Strategic Advantage

History and culture of British Petroleum that shaped wrong decision-making in the case of Deepwater Horizon rig, the poor strategic choices or high-risk taking culture of British Petroleum also the affect of the political environment and regulations on BP's decision-making

PEST Analysis

In order to analyze the macro-environment of the company, identification of the significant market variables that may influence the company's position, productivity, costs, and profits PEST analysis is an effective process (Johnson & Scholes, 1993, p. 32). The PEST analysis examines the affect of each these market factors such as political, envinomental, social, and technological factors evolving organisation would help to prepare its contingency business and strategic plans (Byars, 1991). Researchers suggests that it is also a beneficial tool to understand the market development or position, decline, operations, and direction (Koumparoulis, 2013).

Political Factors

BP continually argued at the point to call the accident a product of the lack in government policies and industrial practices. Whereas, the considerable blame of the loss was placed on the BP, by the governments' commission claiming that accident was an array of aberrational choices. The commission thought that the industry officials should have anticipated the right dynamics of the accident and acted accordingly, BP completely rejected this idea of the commission. According to BP, root cause of the disaster was absence of the significant political reforms that affected the decision-making capabilities of BP and the partners, as it resulted in a significant restriction in their decisions. The BP claimed, there was a need to amend the industrial practices and policies of the government to avoid such accidents in future (National Commission Report, p. 122). Thus, the culture and background of BP shaped its decision-making in the incident of Deepwater Horizon and also the British political and regulatory system also affected their decision-making significantly.

Envirnomental Factors

The history, back ground, and organisational envirnoment of British Petroleum is associated with the oil industry of Middle East, where the industrial culture was quiet different as compared to the British industrial culture that substantially affected the decision-making of BP. The Middle Eastern cultural background of the company needed to be improved according to the British market environment and safety management culture for the effective safety and marketing decisional strategies, as proposed by the Board of Hazard Investigation and the chairman of US chemical safety. The company changed its name from Anglo-Persian Oil Industry to the British Petroleum in 1954 (History of BP, 2011, p. n. d), but still was not able to improve its strategies with repect to British market ...