Up’s production statistics indicates that the natural gas accounts for over 50 percent energy production in the united States. The company is vertically integrated and is involved in multiple operations in oil and gas industry, which encompass production, exploration, refining, power generation, petrochemical, marketing. And distribution. BP has also ventured in alternative energy technology and has prioritize solar, wind, and bio fuels (Seldom & Rosenberg 201 1). The external environments that are likely to affect Up’s business success include political and environmental factors.
Up’s financial success can be affected by political actors. BP operates in diverse markets where politicians create legislations in the oil industry that may affect its operation. BP global presence is also threatened by numerous international conflicts such as Arab spring and war in Gulf region (Aldrich, 2008). Environmental and technological factors have a direct impact on Up’s financial success since the company will require huge finances to develop new and renewable energy sources. Demand for renewable energy is growing as consumers embrace green energy to replace fossil fuel.
Environmentalists, consumer advocacy groups, are calling for the velveteen of alternative energy sector in order to reduce the environmental pollution associated with hydrocarbon. BP has invested heavily in the oil industry and were strong in the oil industry as opposed to alternative energy sector. BP enormous knowledge in oil refining, drilling, transportation, storage, and marketing cannot be matched with the photovoltaic industry (Hough & Taller, 2010). Up’s salient stakeholders Just like any other organization, BP has organizations and individuals who are affected by the operations (Alton, Jack & Thomas, 2008).
The key BP takeovers include shareholders, customers, and the employees. Up’s shareholders are the owners of the company, and they expect they expect their funds to be used efficiently and yield much profit. Shareholders expect the management board to formulate strategies that will give the company a competitive advantage and ensure the comma/s growth. Up’s customers are also key stakeholders whose decision determines the success of the company. The customers are the end consumer of company’s product and services; BP requires support from core customers in order for the company to last.
BP customers expect the company to offer products they value and communicate honestly and transparently. Customers are also concerned with the company activities that may affect the environment. They require BP management to act ethically especially on environmental matters. The third group of Up’s stakeholders is employees. The impact of employee relations has been recognized in today’s organizations, and employees are regarded as assets. Employees who are treated fairly by the employer shows commitment and loyalty. BP as a multinational company provides employment to tens of thousands employees world over.
BP employees offer crucial services to the company and ensure the company has achieved its objectives. BP employees engage the company through trade unions at different BP sites worldwide. Stakeholders’ influence on the organization financial performance Stakeholders are a critical part of a company success because their decision may have serious consequences to the company performance. Stakeholders influence a company’s financial performance in various ways. First, owner- stakeholders can use their vital power to pressure the management to implement shareholder’s decisions.
Stakeholders such as shareholders influence management decisions concerning the company’s management style, strategies orientation, and organizational structure. The financial performance of the firm is greatly influenced by the management style, organizational structure and strategic orientation (Marinades, Elves & Raptors, 201 1). Second, owner-stakeholders can influence management decisions through funds usage and withholding mechanisms. Stakeholders can stop allocating resources to a company in order to compel management to change certain behavior.
Thirdly, stakeholders can also influence a firm’s financial reference by avoiding consuming the firm’s products or services with the intention Of forcing the firm to Stop a certain activity or behavior. A strong customer base loyal to the company’s products and services IS critical for ensuring the future of any company. Fourthly, stakeholders can also influence the company financial performance by demanding increment in wages and salaries. Employees’ salary demands can have serious consequences on company finance because salary increment leads to increase in expenditure and reduced profits.
Lastly, stakeholders influence he financial performance of the organization avoiding the shares of the company, the market value of the company share drop. The loss of value of company shares results in erosion of company’s capital base thus limiting the company operations and financial performance. Up’s controversial corporate social responsibility Organizations are under intense institutional pressure to demonstrate greater commitment to corporate social responsibility (CAR), but the organization must show genuine commitment.
According to Crane & Matter (201 0), compliance should not be symbolic or ceremonial and should be accompanied by real CAR. BP Pl found itself in controversial CAR during the disastrous Departed Horizon oil platform explosion in 2010. BP integrity crisis emanated from BSP failure to fulfill its corporate responsibilities towards the environment, its shareholders, and its stakeholders. BP failed to show genuine commitment in embrace green image by failing back the initiative with the required strategic and operational change.
The Departed Horizon crisis cost US$AD billion in crisis response and additional IIS$billion in fines and damages. BP was not well-prepared to put it in a position to spoon to a blowout in departed drilling. BP also compromised on standard in an attempt to reduce the operation costs (Hicks, 2010). Forming a stakeholder coalition According to Marinades, Elves & Raptors(ADD 1), forming a stakeholders coalition require proper planning and knowledge in order to avoid problems in the future and assist the coalition to achieve its goals.
The following steps are suggested in putting together a stakeholders coalition. Step one entails searching the landscape: It is important to determine whether similar coalition exists in the targeted sector or community. It is important to analyze Ritter and demerits of joining existing coalition. The coalition can also operate separately and coordinate programs, activities and program with existing groups. Step two involves brainstorming ideas on potential participants. Contact as many individual and organizations with similar concern or have been affected by the issue in order to put together a core group.
Invite representatives from the target community, group or sector so that they can participate in a brainstorming session. Identification of important and potential coalition members takes place during this session. It is paramount o remember that ignoring certain people in the community may work against the coalition. A coalition can achieve visibility more quickly if a “champion” is involved. Champion may be political leaders, clergies, civic leader, judge or business person, but should be a highly respected and influential person. Step three involves determining staffing, resources, and budgeting.
A coalition cannot run without dedicated personnel dedicated to managing the initial programs. Coalition needs to be administered effectively, coalition members need to be motivated to maintain their support to the organization, ND programs need to be implemented. It is important to determine whether the project director will be a volunteer or they expect payment. There were key issues concerning the coalition that must be resolved at this point. The source of funds should be determined, the amount of time the project coordinate will dedicate to the program, and the person to supervise the coordinator.
Another question that needs an answer at this session is how to house the coalition office. The coalition may be housed by one of the members, existing organization or rent an office if funds are available. Coalition members may decide to adopt a system where each member hosts the meeting in their offices in a rotation basis. It is also critical to determine all costs associated with forming and running the coalition. The fourth step is inviting people to join the coalition. This involves the recruitment of members to the coalition using the network of the Core group.
The core group have a chance of brainstorming a selected number of possible members. Contact the members and ask potential members to attend the first meeting. The fifth step includes holding the first meeting and clarifying the expectations. Plan ND hold the first meeting. Introduce each member present and involve them. Define the problem that has necessitated the need for coalition and draft the rough discussion or actual statement from the group. Discuss the structure of the coalition. Create a common vision and mission statement that clearly define the coalition.
Discuss procedures of forming an action plan by appointing a small group to draft the plan. Review the things to be done before the next meeting ands schedule the next meeting. Identifying members of the coalition group Identifying members of the coalition group is critical steps because the success of the coalition is determined by individual determination and motivation to pursue the coalition goals and objectives. Identifying members of coalition start by targeting key community leaders such as prominent people in the society.
People are attracted to the coalition when prominent community leaders are involved. Every community has opinion leaders or movers and shakers; people who command respect and make things done. The next step is reaching out and involving people whose jobs relate or are similar to coalition’s work. Such people include environmentalist, fishing roofs, right-based non-governmental organizations, green consumer advocacy groups, and community advocacy groups. Next, reach out to non- traditional communal partners such as clubs, law enforcement officers, consumer advocacy groups, and government environmental urgencies.
Non- traditional community partners can be used to gather crucial data about the nature and consequences of firm activities. Identify people with professional and personal interest. Communities world over does not lack people who have a personal interest or professional interest in environmental inspiration and protecting the community wellbeing. Although it is a tough task to identify these potential members than job-related participants, their individual commitment is invaluable. The next step involves keeping the size of the participants and coalition groups to a management level.
A bloated number of participants may become hard to control and coordinate. Only relevant members of the coalition who are dedicated should be involved in the future activities in the coalition. Coalition challenges Forming a coalition and maintaining a coalition faces many challenges. The first challenge is in coordination of coalition duties and responsibilities and leaving the project coordinator to perform all duties. This problem is aggravated if the coalition lacks sufficient funds to maintain the proposed activities or programs.
Another challenge come when participant loose interest in coalition’s activities and start keeping off coalition’s affairs. A common challenge in coalition is absence of strong leadership to assist the coalition to remain in focus. Overcoming challenges Carroll & Bucktooth (2014) posit that challenges a coalition face can be overcome and make the coalition successful. The problem of sharing of duties can be solved by managing coalition resources effectively and involving all members in organizing the coalition projects and activities.
This can be done well if coalition member is assigned a program or activity and ask to recruit others to assist. The problem can also be solved by organizing committees and giving committee chair full responsibilities managing the committee. The coalition should be provided with sufficient funding in order to keep the activities and program on course and avoid members from being seclusion’s. The problem of lack of interest and members withdrawing can be overcome by allowing time for buy-in to ensure coalition members stay involved and interested.
Obtaining the coalition members’ buy-in and support for the coalition and programs is crucial for the success of the coalition. The leadership challenge can be solved if a strong leader to represent the group is chosen. A strong leader is capable of keeping the coalition on task and focused, despite members’ propensity to deviate from the agenda. The leader should also keep the activities of the coalition moving despite the unwillingness of some key partners and reaching out to the through personal meeting. References Alton, K. Jack, K. , & Thomas, O. (2008). Stakeholder salience in global projects. International Journal of Project Management, 26(5), 509-516. Aldrich, H. (2008). Organizations and environments. Stanford University Press. Carroll, A. , & Bucktooth, A. (2014). Business and society: Ethics, sustainability, and stakeholder management. Coinage Learning. Crane, A. , & Matter, D. (2010). Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford University Press. Hough, H. M.. & Taller, A. (2010).