Prepared for: Mr. Jubred A. Peñano
BP
Course no: BE F06
International Training Program, Banking Academy

Prepared by:
Dương Thị Mỹ Hạnh – Class F06B Registration No: ITP F06-039
No of word:
Submission Date: 7th November 2013

Executive summary In recent year, the world economic is being stressful; all of economy activities are difficult. A lot of big and small companies fall into bankruptcy. Therefore, in order to maintain and develop the business, companies need to have reasonable strategy and also consider about the internal factors, external factors around the company. British Petroleum is one of the biggest oil companies in the world, it is also affected by the economic crisis. Hence, Bp should understand about the current situation of company to give more strategy which help develop the firm in the future.
This report was carried out through the BP website, books and newspapers what relate to the BP’s information. Moreover, the report also provides more information of BP such as vision, mission, goal, value, objectives, BP's environmental and economic situation in the UK. Besides that, this information what was given in this report: * Evaluate the extent BP what it has achieved the objectives of stakeholders * Responsibility of Bp with the factors around the company * Analyst policies in UK what influence to run business * Evaluate economy system allocation of resources and way to use.

Introduction
British Petroleum- England’ petroleum multinational company ( BPPLC). British’s office in London, England. The company started doing business since 1954, base on the foundation of Anglo – Iranian Oil Company with 85.900 employees. British company came to Vietnam in 1989 with a lot of ideas and turned all ideas become reality. The main purpose of company is focus on these departments: protect environment poverty reduction, business promotion and use resources. The firm has invested many projects in Vietnam. More than that, British company has connected to some organizations in order to trade the government’s staff and Vietnamese student to follow study in the King of England. Specially, the British Petroleum is the first company

1.1 Identify the purposes of different types of organization
1.1.1: Legal structure: ( BP.com, n.d ) BP is a publiclimited company what is specializing in oiland gas, petroleum products with nearly 86,000 employees in 80 countries in the world. BP is a publiclimited company because, the shares of BP are trading directly on the stock market world.
1.1.2:Vision, mission, values, goals and objectives
* Vision:
(BP, 2012) British Petroleum wants to be the safe labor in the industry and a grade management in the world. Becoming a good citizen and using a large number of employees. * Mission:
(BP, 2012) The mission statement of BP is guarantee health, safety, environmental security. It means that the Company engages that activities business do not danger for people and damages the environment. * Value:
(BP, 2012) British Petroleum’s value includes 5 elements: * Safety:
Safety is means that good business. This is the prime issue what is cared by the company. Everything BP do what base on safety of workforce and the communities around. BP always care about the safe management of environment. * Respects:
Respects are performed through the law- compliance and the regulations. The head of respects is respect the place where they run business. Besides, the system of company complies with the highest ethical standards and behaviors effective to take over the customer’s belief. The employees and the firm are always respect together. Specially, British Petroleum Company overvalues the human act of creating and also interested in the work of activities of the company are based on the safety for employees and communication. The company always interested in the environmental safety. * Excellence:
British Petroleum Company runs business in the toxic environment hence, the firm commits the manager of system and disciplinary process in the run business process effectively. It also engages about the quality of products. The product’s quality is abided the rule and standard what are set out. The company wants to give the comments from customer and leans more in order to improve the lacks. * Courage:
To successful, it needs to be brave in order to face to face with difficulty, stand on own feet.
The Company always tries to right issue, discovers something new and does not affair to learn. Maxim of company is trust itself, finds out the feedback from customers to develop the company. * One team:
Although, British Petroleum Company has individual strength, the company encourages everyone connect together. Always put the individual success is in front of the group, contributes the trust with members. * Goal:
(BP, 2012) The goal of the BP is to maximize long-term shareholder value through the allocation of BP resources to activities in the oil, natural gas, petrochemicals and energy firm.

* Objective:
(BP,2012) British Petroleum Company wants to creative the hydrocarbon chain’s value. This process will be began with exploration and ended by providing energy for daily products.
More than that, according to the Finance report in 2012, the firm reached $ 17600000000. The objective of company in 2014 is operating cash flow reach around $30 to $31 billion.
Besides:
- There are 4 new projects will be stared in this year.
- From 15 to 25 exploration wells would be bored at the end of the year. Therein, 8 wells have been doing in Egypt, India, Indonesia, Jordan and Mexico Bay.
1.1.3: Evaluation:
* Vision: BP’s vision is clear. BP wants to bring a safe working environment for their employees. Clear vision help BP can identify the way to develop the labors resources for company.
* Mission: The mission of BP is focus on protecting the environment. This task help BP have right activities to save and improve environment what make the good image of company in the customer’s eyes.
* Value: the values of BP are safety, respect, excellence, courage and one team. These items are so clearly and help BP can identify their strong, weaknesses in the inside and the threats and also opportunity from outside of company.
* Goals: Due to the goals, BP can mining maximizes the ability of shareholders to make conditions development of the company's activities in the field of energy.
* Objective: BP objective is reasonable in the actual situation. BP is the big company of UK in petroleum field so this objective help BP have orientations, projects in order to expand the market and develop company in the future.

In general, vision, mission, goals, objectives and value of BP is quiet suitable and clear, it was pointed out the direction for future BP, which helps BP become one of the largest mining and processing oil company in the world.
1.2: Describe the extent to which an organization meets the objectives of difference stakeholders:
In an organization, there are many stakeholders with many difference interest and objectives. In three kinds of stakeholders, there are three main stakeholders who are employees, customers and community :
1.2.1: The influence of stakeholder on the company: 1.2.2: Explanation:
A, Manager contributed an important part in the company, they give the decision, strategy for company and they also have responsibility with their decision. That is the reason for the management has high salary.
B, Employees: are a main part of company, the firm can run business when they do. Therefore, the success of company is depended on the employees.
C, Customers: The success of company is depend on customers. Customers bring profit for company, hence, the firm need to care about the demand of customers in order to have strategy to service their customers
D, Shareholders: don’t participate on the produce process of company, they just care about revenue of BP and dividend or stock price
E, Suppliers only are people who provide the material for produce process of company. Thus, they don’t have authorities to give the decision or strategy for company.
F, Banker cannot relate to the produce process company and give any decision. They only provide capital in order to support company’s business with a low interest rate.
G, Government affects to BP impress, the BP’s business always follow the law and policies what the government proposed. However, they are not interested.
H, Community is one of factors what BP Company cares. Base on their demand, BP will produce products what satisfy their need. Besides, BP gives them jobs, they are also interested through communication activities what BP joins.
1.2.3: Evaluate the extent to which an organization achieve the objectives of the stakeholders

Staff: * BP is one of the biggest Petroleum company in the world with nearly 86000 employees. We can see that BP has strong workforces. Employees belong to the internal stakeholders. Thus, Employees become the asset and background of BP in order to develop the company.BP’s Employees have the high salaries relatively. It is common from £30,667 to £57,000 * (BP,n.d) Beside, in order to attack and keep feet of employees, BP has some policies about the reward for employees sụch as making the reward packages, allowances, bonuses, health policy, holiday pay and some other benefits. * Moreover, The employees of BP always been working in the safest environment. ,(BP, n.d) “Safety is a priority for us and we continue working to embed safety and operational risk management into the heart of the company”. Hence, BP has make policy about the heath and safe for their employees, provide the best equipments for workers.
(Rewards and benefits, n.d.)

Customers: * The quality and price of product are interest by customers. In fact, all of BP products always satisfy the demand of customers. There are many BP products in the market such as liquid petroleum, gas for daily activities, BP bio – fuels for road transport. . . More than that, the price of product is also suitable, for example: Lubricants for motorcycles is BP Vistra 100, vistra 300 its price is common from £ 3,3 to £8,1 This is the best lubricants for motorcycles today and also suitable with everyone’s pocket.

In addition, BP also provide many products what serve for industry, biology and for home, . . .Furthermore, the customer service of BP is very good. The company has many customer care programs, repair services, as well as promotion. It has been given the positive from customers.

Government:
- (BP.com, n.d) BP has reached the goals that it sets for the government. BP cooperated with community organization to volunteer programmers, education and training. . .
- ( BP, n.d ) In addition, BP engages “We care problems leading to environmental pollution and the safety of the people. Therefore, all employees in the company are committed to comply with and implement business policies of the Company Health, Safety, Security and Environment “. . BP Company also provides thousands jobs for local people, good working place for employees.
- Although, BP always care about the environment but the oil spill in 2012 what historic oil spill in 2012 has left serious consequences, affected the environment. ( Người đưa tin, 2012) when disaster happened, it is estimated there are more than 750,000 liters per day of crude oil leaked from the rig, the sea surface slick is about 9.000km2. Oil spills were destroying the ecosystem of the Mississippi River and along the mangrove swamps of Louisiana, made land at an island of heavy pollution and affect to the life of people in that area.
In short, BP reached success in order to satisfy stakeholders, specially staffs, customers and government. They provide the best working condition and environment for staffs, good products with high quality and best care service for their customers. Besides, their responsibility is also considered such as social activities, make job for local people. However the environmental issue is one of matters what BP concerns, BP has not done well in this issue
1.3: Responsibilities of BP and strategies employed to meet them:

| Specific responsibilities | Strategy employees | Social responsibilities | A,Care about common social development | Funding for scholarship of local educate organizations | Ethics and business | B,Handling ethical violations | Apply disciplinary measures such as layoffs, termination of the contract | | C,Tax | Pay tax for government on time | Management responsibilities | D,Encouraging employees | Care about working environment and insurance, reward and security | | E, Responsibility with the customers | Listening and trading to the customer. | | F, Prestige to the competitors, suppliers, investors | Building the fair trading | Public relations and cooperate imager | G, Improve product | Providing more products what satisfy of need customer | Environmental responsibilities | H, Care about impact of greenhouse, water in local | Applying the OMS technology | | I, Reduce the pollution | Reduce oil spill |

1.3.1, Social responsibilities:
“The social responsibility of an organization may be defined as the obligations that the organization has towards the people and people in which the company operate” (course book, page 48) .
A,BP is similar with many other organizations. Besides running business, BP also has responsibility with social. BP always cares about the education that is one of strategy of development. Specially, in Mexico, BP company had cooperate with UK’s foreign, Commonwealth Office and the University of Leeds in order to trade the staffs of government and students. Moreover, £413.000 has been fun for Mexico students to follow study in UK after graduate. (BP,n.d)
1.3.2. Ethic in business:
H, BP is one of company what has Ethic opinion clearly. All of members in BP have to be responsibilities and have obligation to comply. (BP, n.d) The BP company usually checks to demonstrate that their staffs, contractors are responsible with ethic. If staffs and contractors violate, they will be punish through disciplinary measures such as layoffs or contract termination.
According to report of BP:
- In 2011: 529 cases dismissed.
- In 2012: 424 cases dismissed.
C,Tax:
BP has responsibility pay the tax for government on time. According to the report the number of tax what BP paid for government: In 12012, $12,737 was paid for government tax ( BritishPetroluem, 2012)
1.3.3: Management responsibilities:
Stakeholders who connect to business of organization. Therefore, the company’s responsibilities with them is very necessary.
D, Firstly, the employees – the firm always has responsibilities with them. It is performed by paying the suitable salary, insurance when they work and irrespective of religion, gender, age. .. That is what they deserve and have the right to require.

E, BP company need also have responsibilities with customers. Always listening to customers is the first thing which company should do. It will bring more profits and a large of loyal customers for company. Thus, the company should trade with the customers to give the comments what are demands of customers. F,BP need to maintain the relationship with their suppliers, investors and competitors. BP also keeps responsibilities to them and competitors by building a fair trading.

1.3.3: Public relations and cooperate imager:
G, BP has about seven types of products: BP Bio fuels, Gas and fuel cards, gas station and oil, motor oil and lubricants. Route and plan Gas journey, and oil stations and positioning BP Neutral objectives. Besides, Bp has products for home, BP liquefied petroleum products. Finally, with products for businesses, BP has 13 products such as Air BP, Asphalt Bitumen, BP Oil has separated slightly, BP franchise, BP Shipping, gas and electric power, liquid gas Neutural, petrochemical. . .(British Petroleum, nd)

1.3.4, Environmental responsibilities:
H, This is the issue what BP interest, BP always care about the environmental impacts to deal what affect to the local. For example: greenhouse, water .. . Therefore, BP company applies the OMS technology in order to track and evaluate these impacts.
I, The oil spill is also one of the problem, it makes the BP worries. BP company has made significant progress in the way what reduce the oil spill. BP also connected to the government in the planning to overcome and response the oil spill.

2.1: Explain how economic systems attempt to allocate and make effective use of resources available within the country
2.1.1. Identify the Economic systems:
(Businessdictionary, n.d) An economic system is the type of rules and schemes used by a group of people to exchange valued goods and services between different parties. Having a system that this group agrees upon is necessary for the relative success of trade. Different types of systems exist around the world and are usually heavily linked to the actions of a link to the government.
2.1.2. Types of economic system:
(Ehow, 2011) There are three main types of economic system. These are:
Market Economy
Command/Planned Economy Mixed Economy
2.1.3. The economic system of UK:
(Ehow, 2010) UK is one of the mix economic systems where the free market and capitalism run business in order to try to ensure fairness in trading transactions and doing the rules.
In 1980, all most of government companies in services and industry were privatized and nationalized under the government of Margaret Thatcher.
Nowadays, UK is the 6 largest county of the world in 2012 in term of GDP. UK has become the member of G7, G8, G20, it also joins into the cooperate organization and develop economic such as EU, OECD.
2.1.4. Factors of production:
2.1.4a: Labor:
( Economicwatch.com, 2013) In 2012, The population of UK is 63,244.000 people. UK is a country which has labor force at 20 in the world with 31,9 millions people. There in:
- 17,3 % are ages bellow the 15 years old.
- 64,5 % are ages from 15 to 64 years old.
- 17,3 % are ages above the 65 years old.
The labor force of UK is distributed inefficiently, it is divided into 3 groups: Agriculture, industry and services.(Cia.gov, n.d)

As can be seen the pie chart, it shows the percent of labor force of UK in 3 main sectors: * Agriculture is 1,4% * Industry is 18,2 % * Service is 80,4 % We can realize that the labor force in industry and service is large. Specially, there are 64,5 % people in the work ages. It will become the advantages for labor force of BP with abundant labor resources and potential.
2.1.4b: Land and resources allocation:
* The total land area of UK is 241,590,00 km2 and land is divided into small part with the different purpose:

Figure: Land use in UK

Land and the nature resources contribute an important part in the economic development of UK. However: * Grasses and rough grazing land account for 52% * Crop and bare fallow makes up 20% * Other agriculture land is 1%

* Besides, the price of land is one of problem in UK. Currently, the price is increasing with high price. Example: * ( Điaoconline.vn,2013) , in 2012, the average value of farmland in the UK has increased, it is about £ 6,000 ( = 9.300USD)/acre . Moreover, price ups to £ 10,000 for the land high quality. And in 2013, the price rose by 1,8% further 2012 is £ 6,421/acre. * ( Ukauditionlist,2012) the price of industrial land in UK is quite high, it is about £225,000.
These numbers are demonstrated that UK has a large area for agriculture, agricultural land accounts for nearly two thirds of the land area of the UK. This is one of the disadvantages to develop the industry in this country which has the industrial development. Specially, in the mining and mineral processing field as BP. Therefore, in my opinion, the UK government should give more projects in order to improve agricultural land to increase the efficiency of using land in industry.

2.1.4c: Capital resources:
* FDI

UK is one of countries attack a large of money for investment, specially is UK with the total projects are invested into UK is 478, secondly Germany with 102 projects and thirdly, Japan is 102 projects. (Deloitte.co.uk, n.d)
(Ey, n.d) in 2012, the number of projects coming to the UK rise by 2.6% than 2011. * ODA : ( Ey,2012) In 2012, The government of UK aid for Sweden, Netherlands, Denmark and Luxembourg and Norway with the total aid expenditure reached £8.6 billion, it equivalents 0,5% of national income.
In conclusion, these capital sources is one of advantages for BP’s business, they provide a part of capital, land and also labor forces in order to help BP develop their help develop mining projects in oil wells.
2.2 Impact of fiscal and monetary policy on UK economy
.2.1. Fiscal policy: According to Act No5 of 2000, in 2009, UK has applied many fiscal policies in order to develop economic. UK’s coalition government was voted through some new fiscal policies what enforced to reduce the expenditure. Conservative Democrats and liberal, led by the Exchequer George Osborne, their plan in controlling the government spending of £ 83 billion and reduce the debt of nation by 19% in the five years later. Besides, in 2010- 2011, the budget of fiscal policy was reduced to £ 5700000000.
Moreover, UK tried to erase its debt by limiting its maximum benefits through reduce the expenditure in social programs. In 2010, total of UK’s expenditure is £ 668.900.000.000. Through the social programs, UK’s government received about £ 1457000000000 (account for 23,75% GDP).
In addition, UK also has some policies to invest for infrastructure. It is one of the develop policy of UK what provides an external benefit to the rest of the economy.
2.2.2. Monetary policy:
In the UK, the objective of monetary policy is to keep CPI inflation target of 2% + / -1. They also look at the macro-economic variables such as growth rate and unemployment rate.
The UK monetary policy is set by the Monetary Policy Committee (MPC) of the Bank of England. They are independent in setting interest rates, but to try and achieve the inflation target of the government.
In the recent years, UK gave some policy in order to reduce the inflationary pressure and changing the economic. UK applied the policy “ The funding for lending scheme” to change the interest rate:

The chart shows the interest rate of UK from 2007 to 2012, we can see, In 2007, UK’s interest rate is the highest, accounting for 5.8%. However from 2008, it tends to decrease and continue to decline in the following years. Due to the right policy of government, the interest rate was stable during a long term with 0,5 %
Beside, the UK’s government also applied the expansionary monetary policy which makes the UK’s economic growth and rehabilitate. * (Ehow, 2012 ) The UK economy would grow by 1.7% in 2010, 3.4% in 2011, and 3.5% in 2012. * Enlivening the business investment.

In short, both of fiscal policy and monetary policy helps UK go over hard and to stimulate production and trade. In addition, these policies also contribute the competitive among company, expand the market.
2.2.3 Situation of UK’s fiscal and monetary management and the impact on BP and stakeholders.
2.2.3a: Real situation of UK’s fiscal and monetary management
(economicshlp, 2010) The aims of fiscal and monetary policy are similar. They are both used to: * keep inflation low (inflation target of 2%) * maintain positive economic growth (close to long run trend rate of 2.5%) * aim for full employment
The principle aim of fiscal and monetary policy is to reduce cyclical fluctuations in the economic cycle. Often it is inflation targeting which is stressed most for monetary policy. * Fiscal Policy involves changing government spending and taxation. It involves a shift in the governments budget position. e.g. Expansionary fiscal policy involves tax cuts, higher government spending and a bigger budget deficit. * Monetary policy involves influencing the demand and supply of money, primarily though the use of interest rates. It can also involves unorthodox policies such as open market operations and quantitative easing.
2.2.3b The impact of tight fiscal and monetary policies on BP and stakeholders
- The monetary policy of government in reducing the investment rate makes conditions for BP loan to invest in new oil projects. When the interest rate is reduced, the customers will limit keeping the money in the bank. Therefore, they spend money for shopping and the products of BP will be more sale, the income of BP will be go up.
- Cutting tax is one of big advantages for BF and all of the stakeholders increase profits, create the jobs . . . 2.2.4: The situation of the global economy has affected the global economic and business activities of BP:
*In 2012, the global economic had many difficult. However, according to the “situation and prospects report of the global economy in 2013” published on 12.18.2012, global economic growth of 2.2% and continued growth with 2,4% in 2013.
*(CIA World Factbook, 2013), The inflation rate (consumer price):
- World average makes up 4,2% in 2012 * Develop countries is 2,2% in 2012 * Developing countries is 5,5% in 2012
In recent years, the trend of inflation rate is decrease for most countries.
These factors have affected to the UK economy and business of BP, they also become the BP’s advantages. As a result, the BP’s profit will be increase, therefore, BP should maintain their business and develop the products in order to expand the market.
In brief, government’s policies have created conditions for BP in the business. Especially, fiscal and monetary policies which helped BP in tax and interest rates in order to brings more profit for the company.
2.3 Evaluate the impact of competition policy and other regulatory mechanisms on the activities of a selected organization
2.3.1: Identify the competition policy:
(Business dictionary, n.d) The competition policy aims at ensuring that competition in the marketplace is not restricted in a way that detrimental to society
2.3.2 Evaluate the UK government’s industrial policy impacts on BP’s operation:
2.3.2.a: Industrial competitiveness policy:
The UK economy is facing with some basic challenges in order to compete. Government plays a important role in the formulation of policies and create competitive conditions for industrial development in UK. Especially in the UK, industrial policy is a evidence for economic development effectively.
(UK industrial policy, 2008) UK industrial policy includes: creating an institutional framework that allows business to develop, workers and families to improve their living standards gradually. Promote effective competition, flexibility in labor and capital markets, creating a legal system for the confidence and faith to join in the market “
2.3.2.b: Industrial training and skills policy:
Industrial Training refers to work experience related to professional development prior to graduation.
So the industrial training is an essential part to equip students with experience before graduation .The purpose and objectives of industrial training are:

1. Approaching with the working environment .

2 . To develop the interpersonal and communication skills

3 . Students apply the knowledge is taught in the lecture to apply in the real.
4. To work with the professional person. finally , with all the experience and knowledge gained , hoping that the students will be able to choose a suitable job after graduation .
2.3.2.c: Industrial regional policy:
The industrial regional policy of Un focus on 3 main sectors:
- Agricultural sector where has the low standard of living
- Industrial sectors where industry weakness
- Sectors where meets the serious problem airs, water pollution of traffic jam
If BP company in these sectors, BP will be given a lot of supports and the preferential policies from government
2.3.3: Evaluate the impacts of government’s policy on BP’s operation in UK
*(Factory act 1996) This law rules the standards in factories and industrial areas. Specially where toxic working environment, labor need to be supported equipments and be safe during the production process. Employers must take out the insurance for all of the injury cost (Act 2000). These are the advantages for BP in order to attack the labors, BP is one of the company which has the toxic working environment. Therefore, due to BP is responsible for using employees in factories.
* Moreover, (Act 1997 of Industrial law) government encourages projects in mining, processing, mineral what bring the economic value. This policy makes better conditions for BP develop mining and processing the oil and gas.
In short, the industrial policy affects to BP’s business, brings many profit for BP and helps BP plans to develop in UK. Besides that, products of BP have opportunities to become more and more popular in UK.

Conclusion
In UK, BP has a good environment to run business. BP reached a lot of success and profit through provide more the high quality products what satisfy the customers. There are three types of stakeholder, BP has a good relationship with them. As the result, BP can make stakeholder satisfaction as much as possible. Besides, BP has done well the company’s responsibilities with government and people in UK. UK has many resources such as labor, land and capital what are these advantages for BP produce product in UK easily. Moreover, government has a lots policies to encourage and support for BP to invest and develop in UK market. Government policy which used in UK are fiscal and monetary policy what help decrease interest rate. Government policies also create more conditions for BP to develop company in UK.

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