BP ENERGY CRISIS - Essay Example

In fact, it seems that severe gaps exist in existing organizational strategies; reference can be made to the last year’s accident in the firm’s operational unit in the Gulf of Mexico. The above event proved the actual aspects of the crisis in the energy sector: firms operating in this industry focus on the increase of their production rather than on the effects of their activities on the environment. In the case of BP, it is noted that ‘total industry production from the Gulf of Mexico provided the biggest single increase in world oil supplies last year -- of nearly 400,0000 barrels per day’ (Pagnamenta, 2010).

Of course, the efforts for the increase of production in this sector are related to the energy crisis – the need for a continuously higher amount of energy, as a result of the increase of the relevant human needs. However, the accident in the Gulf of Mexico proved the lack of appropriate hierarchy in regard to the firm’s goals, the global needs for energy and the environment; the existing mechanisms for the control of the firm’s operational activities have been quite ineffective The Competing Values Framework is suggested in this paper as an effective tool for the alteration of the firm’s strategies; the latter need to be based not only on profitability but also on the effects of the firm’s operations on the environment.

The appropriateness of this framework for BP is evaluated using two additional theoretical models, Porter’s Five Forces model and the SWOT analysis theoretical model (see Figures 2 and 3, Appendix). The Competing Values Framework (see Figure 1, Appendix) is based on the principle that organizational strategies need to be based on three different values – which compete for each other: ‘the control versus flexibility, an internal versus the external focus and an emphasis on means versus end’ (Amos et al.

2009, 266).