Question
United Arab is the country for Chevron could consider expanding into. Analyze that potential international market by considering the 4 aspects of the Diamond of
United Arab is the country for Chevron could consider expanding into.
Analyze that potential international market by considering the 4 aspects of the Diamond of National Advantage: industry rivalry, demand conditions, related and supporting industries, and factor endowments.
Analyze the forces (in the home market and international market) that will help the organization succeed with its expansion and the forces that may act as barriers to that expansion.
Refer to your analysis of strengths and weaknesses
Strong Financial Position. The company's incomes have constantly beengrowing over the years. Thestrongfiscalposition has stopped the company fromdepend on loans to run itsprocesses. Again, the company'ssturdyeconomiclocation has made itpromising forexceedinglyexperienced employees to work for the company (Mahru, 2020).
Solid Worldwide Presence. Chevron Corporation has 180 branches global. The importance of these offices is to allow the company to reach out to many more customers. Reaching out to those customers will intensify the chances of producing higher income and earnings.
Significant Change In the Energy Sector.Chevron Corporation has participated in the geothermal manufacturing of energy. This method enables the company to continue producing high income when oil and gas prices have declined.
the Porter's Five Forces
Threat of new entrants Chevron operates in the energy industry, which has high entry barriers. Numerous factors make it hard for new entrants to attain sustainable competitive advantage. The leading among them is high capital spending, economies of scale, technical expertise, investment in distribution channels, and proficiency in global exploration projects, environmental guidelines, and government protocols(2019). |
Power of buyers Consumers and industries greatly depend on fossil fuels to satisfy their energy needs. Electric cars have been presented on the market, but most consumers cannot find the money to buy them. Also, there are very few companies in the energy sector. So it gives slight options to consumers to switch from one brand to another(Chevron, 2022). |
Power of suppliers Oil and gas alternatives include solar, wind, nuclear, and hydroelectricity. Chevron is not facing serious challenges posed by alternative energy sources. However, the company will need to manage the growing number of environmental and government guidelines that aim to curb pollution. For example, petrol and diesel cars are being phased out in many countries which have set a target to transition to electric cars by 2030. According to the US EIA (Energy Information Administration), the mandate for renewable energy sources will surge rapidly by 2050, while the demand for petroleum products will fall moderately(Annual Energy Outlook - U.S. Energy Information Administration (EIA), 2022) |
Power of substitutesThe energy sector has fewer suppliers than the lower number of buyers (players like Chevron). Hence, the negotiating power of suppliers is limited(Chevron Policy, Government and Public Affairs, 2022a). However, it is worth mentioning that the services and products delivered by suppliers are specialized products. For example, not many drilling companies provide specialized services to energy companies. So energy companies also do not have many choices when looking for a service. An industry supplier who grows through advancing mixing can pose a more severe threat to Chevron. Hence, suppliers have modest bargaining power in the energy sector(Annual Energy Outlook - U.S. Energy Information Administration (EIA), 2022). |
Rivalry among competitors Despite the lower number of companies in the energy sector, the competition is intense due to almost comparable skills and financial prowess among the competitors. The industry's exit obstacles are low, affecting the profitability of all the companies(Chevron Policy, Government and Public Affairs, 2022a). Due to the industry's capital-intensive nature, almost all rivals have the financial power to push for space and act per government regulations. Cost reduction and productivity improvement are the two approaches adopted to remain in business. Additionally, almost all contenders have begun to invest profoundly in research and development of renewable energy sources(Chevron, 2022). |
Complementors Chevron's products are seamlessly complemented by additional products like automobiles and power plants, whose request is stout. The demand for automobiles is excellent in developing economies with fewer governmental regulations. The present-day power plants are well-matched to work with fossil fuels like natural gas. Eliminating the concerns faced while using renewable energy sources will take time(Chevron, 2022). |
your analysis of the Diamond of National Advantage.
Evaluate the 4 adjustments leaders must make when expanding internationally (Burkus, 2012). Recommend 1 specific leadership action for each adjustment, such as developing a global mindset, developing sensitivity to cultural differences, decentralizing, deciding on the level of involvement, etc.
Recommend whether the organization should expand into the chosen country. Explain your rationale.
PowerPoint presentation to present your analysis and recommendation. Include the following sections in your presentation:
- A cover slide
- An agenda
- Identification of the country you have chosen (1 slide, with brief speaker's notes)
- 1 slide foranalysis ofeach of the elements of the Diamond of National Advantage (4 slides, with speaker's notes)
- A summary of analysis of the forces that will help the organization succeed in the new country (1 slide, with speaker's notes)
- A summaryof analysis of the forces that will hinder the organization's success in the new country (1 slide, with speaker's notes)
- Leadership actions required to make the 4 adjustments identified by Burkus (2012)
- A recommendation and rationale(1 slide, with speaker's notes)
- A conclusion
- References
Step by Step Solution
There are 3 Steps involved in it
Step: 1
1 Cover Slide Title Chevrons Potential Expansion into the UAE Your name and date 2 Agenda Slide Introduction Analysis of Diamond of National Advantage Analysis of Forces in Home and International Mark...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started