Chevron

Chevron Corporation 2009 Presented to: Prof M. Asim

Section: F

Presented by: Zohaib Zahid

L1F11MBAM1029

University Of Central Punjab

Table of Contents Contents A. Case Abstract ....................................................................................................3 B.

Vision Statement...............................................................................................3

C.

Values ...............................................................................................................3

D.

Executive Summary..........................................................................................4

E.

External Audit...................................................................................................4

G.

External Factor Evaluation Matrix (EFE) ........................................................5

H.

Internal Audit ....................................................................................................5

I.

Internal Factor Evaluation IFE Matrix .............................................................6

J.

Swot strategies ..................................................................................................8

K.

Grand strategy Matrix.....................................................................................10

L.

IE Matrix.........................................................................................................11

M.

SPACE MATRIX ...........................................................................................11

N.

QSPM .............................................................................................................12

O.

Future recommendations ................................................................................14

Chevrons Corporation A. Case Abstract Chevron is one of the world's leading integrated energy companies and conducts business worldwide. Our success is driven by our people and their commitment to get results the right way by operating responsibly, executing with excellence, applying innovative technologies and capturing new opportunities for profitable growth. We are involved in virtually every facet of the energy industry. We explore for, produce and transport crude oil and natural gas; refine, market and distribute transportation fuels and lubricants; manufacture and sell petrochemical products; generate power and produce geothermal energy; provide energy efficiency solutions; and develop the energy resources of the future, including research for advanced biofuels. We trace our beginnings to an 1879 oil discovery at Pico Canyon, north of Los Angeles, which led to the formation of the Pacific Coast Oil Co. That company later became Standard Oil Co. of California and, subsequently, Chevron. We took on the name Chevron when we acquired Gulf Oil Corporation in 1984, nearly doubling our worldwide proved crude oil and natural gas reserves. Our merger with Gulf was then the largest in U.S. history. Another major branch of the family tree is The Texas Fuel Company, formed in Beaumont, Texas, in 1901. It later became known as The Texas Company and, eventually, Texaco. In 2001, our two companies merged. The acquisition of Unocal Corporation in 2005 strengthened Chevron's position as an energy industry leader, increasing our crude oil and natural gas assets around the world.

B. Vision Statement Chevrons vision statement is; “The Chevron Way explains who we are, what we do, what we believe and what we plan to accomplish. It establishes a common understanding not only for those of us who work here, but for all who interact with us.”

C. Values Our company's foundation is built on our values, which distinguish us and guide our actions. We conduct our business in a socially responsible and ethical manner. We respect the law, support universal human rights, protect the environment and benefit the communities where we work.

D. Executive Summary Company Profile- Business Overview, Strategies, SWOT and Financial Analysis Company Profile- Business Overview, Key Strategies, Operations and SWOT Analysis” is a comprehensive report on Chevron Corporation Company Profile- Business Overview, Strategies, SWOT and Financial Analysis. The report provides complete information on the operations, organization structure and financial information details of the company. Key strengths and weaknesses of the company on which the company can develop are included. In addition, potential opportunities and key threats in the short to medium term future are also identified. Key historical events and summary analysis of the company and strategy of the company are provided. Locations and subsidiary information and company statement are included in the report

E. External Audit Opportunities 1. Globalization makes it easy to enter international market 2. People are looking for cheap internet connections. 3. Express foods are getting famous to reduce time to be spent. 4. Demand for non-chemical and healthy products.

Threats 1. Increase in the inflation rates creates a demand in lower priced products. 2. Many companies are pricing their products cheaper to impress customers. 3. Increase in hypermarkets and economical supermarkets

F. Competitive Profile Matrix Chevrons CRITICAL SUCCESS FACTOR

Shell

WEIGHT RATING WT RATING WT RATING (WT) SCORE SCORE

Advertising

0.10

4

Product Quality

0.20

Price Competitiveness Management Financial position

Exson Mobil

WT SCORE

4 3

0.40

3

0.30

4

0.40 0.80

0.60

2

0.40

0.05

2

0.10

3

0.15

3

0.15

0.08 0.05

3 3

0.24 0.15

2 3

0.16 0.15

3 2

0.24 0.10

Customer loyalty

0.10

3

0.30

2

0.20

2

0.20

Global expansion

0.15

4

0.60

2

0.30

2

0.30

Employee benefits Customer Service

0.10 0.17

4 3

0.40 0.51

2 2

0.20 0.34

2 2

0.20 0.34

TOTAL

1.00

3.50

2.50

2.23

G. External Factor Evaluation Matrix (EFE) Key External Factors Opportunities

Weight Rating Weighted Score

Globalization makes it easy to enter international market

0.15

4

0.60

People are looking for cheap internet connections.

0.10

3

0.30

Express foods are getting famous to reduce time to be spent.

0.10

2

0.20

Demand for non-chemical and healthy products.

0.10

3

0.30

0.15

3

0.45

0.20

3

0.60

0.10

2

0.20

Threats Increase in the inflation rates creates a demand in lower priced products. Many companies are pricing their products cheaper to impress customers. Increase in hypermarkets and economical supermarkets

1.00

H. Internal Audit Strengths 1. Understand the company operations across the entire oil and gas value chain

2.55

2.

Identify strengths, weaknesses, opportunities and threats facing the organization businesses

3. Respond to your competitors’ business structure, strategy and prospects through support sales activities by understanding your customers’ 4. Capitalize on the analysis of experienced companies when entering a new niche or market 5. Gain insight into the methods used by key industry players which give them a competitive edge 6. Understand the company''s financial status through our data on statements and ratios

Weaknesses 1.

Price of coffee is high at Chevrons

2.

Less marketing and advertising its product

3.

Chevrons products are not available at supermarket

I. Internal Factor Evaluation IFE Matrix Key Internal Factors

Weight

Rating

Weighted Score

0.21

4

0.84

0.10

4

0.40

Strengths

1. Understand

the

company

operations across the entire oil and gas value chain 2.

Identify strengths, weaknesses, opportunities and threats facing the organization businesses

3. Respond to your competitors’

0.10

3

0.30

0.10

3

0.30

0.12

4

0.48

0.08

3

0.24

0.10

2

0.20

0.07

2

0.14

0.12

2

0.24

business structure, strategy and prospects through support sales activities by understanding your customers’ 4. Capitalize on the analysis of experienced companies when entering a new niche or market 5. Gain insight into the methods used by key industry players which give them a competitive edge 6. Understand

the

company''s

financial status through our data on statements and ratios Weaknesses 1. Understand the key strategies being adopted by the company to increase their market shares 2. less marketing and advertising its product 3. Chevrons products are not available at supermarket TOTAL

1.00

3.14

J. Swot strategies

STRENGTHS

WEAKNESSES

S1.

W1

Huge market expansion to China, Brazil,

Price of coffee is high at

India and Russia

Chevrons

S2.

W2

Provide a great work environment

less

S3.

advertising its product

Apply the highest standards of excellence

marketing

and

W3

in services.

Chevrons products are not

S4.

available at supermarket

Chevrons has monopolistic advantages over its competitors. S5 Purchased Ethos healthy water for 8 million and also does not use chemical flavor for coffee. S6 Launching the sales of Frappuccino in Japan and Taiwan

OPPORTUNITIES

SO Strategies

WO Strategies

S1,S3,O1,O2,O3

W1,W2,O1,O3

international market

Do advertisements about the FREE

Reduce the price and Advertise the

O2.

internet connections and the excellent

products all over the places.

People are looking for cheap internet

service they provide.

O1. Globalization makes it easy to enter

W1,W3,O3

connections

O3.

S5,O4 Do

Express foods are getting famous to

R&D

to

sell

products

at

reduce time to be spent

Chevrons shall increase the healthy

supermarkets without reducing the

O4.

products into market as the demand for it

quality with cheap price

Demand for non-chemical and healthy products

is high.

THREATS

ST Strategies

WT Strategies

S2,S3,S4,T1,T2

W1,W2,T1,T2

Chevrons needs to change its market strategy by reducing the price to compete with the competitors.

Create new complementary products which contain good quality and lower price to attract more customers.

T1. Increase in the inflation rates creates a demand in lower priced products.

W3,T3 T2. Chevrons needs to analyze the way to reduce the risks of selling its coffee products at supermarkets as customers are demanding for it.

Many companies are pricing their products cheaper to impress customers. T3. Increase in hypermarkets and economical supermarkets

K. Grand strategy Matrix

1. 2. 3. 4.

Quadrant II

Quadrant I

Quadrant III

Quadrant IV

Market development Product penetration Product development Forward integration

L. IE Matrix IFE weighted score 3.0 to 4.0

2.0 to 2.99

1.0 to 1.99

I

II

III

IV

V

VI

VIII

IX

Chevron VII

M. SPACE MATRIX FS +6 CONSERVATIVE

AGGRESSIVE +5 +4 +3 +2 +1 -

(2.5, 1.3)

CA

IS I -6

IIIIIIIIIII -5 -4 -3

DEFENSIVE

-2

-1

0 +1 -1 -2

-

-3

-

+2

-4 -

+3

+4

+5

COMPETITIVE

-5

-

-6

-

ES

+6

N. QSPM Do advertisements about the FREE internet connections and the excellent service they provide

Key Factor

Weight AS

Chevrons shall increase the products into market as the demand for it is high

TAS

AS

TAS

Opportunities

1. Globalization makes it

easy

to

0.15

----

---

----

--

0.10

4

.40

3

.30

0.10

--

--

--

--

0.10

3

.30

3

.30

0.15

2

.30

3

.45

0.20

-

--

-

-

enter

international market 2. People are looking for

cheap

internet

connections. 3. getting

famous

to

reduce time to be spent. 4. Demand

for

non-

chemical products. Threats 1. Increase in the inflation

rates

creates a demand in lower priced products. 2. Many companies are pricing their products cheaper to

impress

customers.

3. Increase

in

0.10

3

.30

1

.10

0.21

1

.21

3

.63

0.10

-

-

-

-

0.10

3

.30

2

.20

0.10

3

.10

4

.40

0.12

-

-

-

-

0.08

3

.24

4

.32

0.10

4

.40

3

.30

hypermarkets and

economical

supermarkets Strengths 1. Huge market expansion to China, Brazil, India and Russia 2. Provide a great work environment 3. Apply the highest standards of excellence in services. 4. Chevrons has monopolistic advantages over its competitors. 5. Purchased Ethos healthy water for 8 million and also does not use chemical 6. Evaluate your company against this company in terms

of

advantages

risk, and

performance.

Weaknesses

1. Price of coffee is high at Chevrons

2. less

marketing

and

advertising

0.07

3

.21

3

.21

its product 3. Chevrons

0.12

products are not available at supermarket 1.00

Z score X1 =working capital / total asset

=2609396/5672600 =0.46 X2= retained earnings/ total asset =2402400/5672600 =0.42 X3 =EBIT/ total asset =512,900/5672600 = 0.09 X4= marketing value of equity / total liability = /3181700 X5= Sale / total asset =10383000/5672600 = 1.83 Z score = 1.2x1 + 1.4x2 + 3.3x3 + .6x4 + x5 O. Future recommendations 1. develop the energy resources 2. research for advanced biofuels.

2.16

3.21