The comparison of Lukoil & BP Case Study Example | Topics and Well Written Essays - 2750 words

The comparison of Lukoil & BP - Case Study Example The company registered thelargest trading volumes among foreign companies tradedon the London Stock Exchange (IOB) in 2005 and at home, the Russian Trading System - also in 2005. Sales coverage includes the 59 regions Russia and 16 other countries -Azerbaijan, Belarus, Georgia, Moldova, Ukraine, Finland, Bulgaria, Hungary, Cyprus, Latvia, Lithuania, Poland, Serbia, Romania, Czech Republic, Estonia, and the USA. Distribution operational capacity stood at 199 tank farms and 5,405 gas stations by the end of the year 2004. This includes 779 Mobil gas stations throughout the USA (LUKOIL, 2006a). BP was formerly known as British Petroleum and is a British energy company with headquarters in London. After merging with the Amoco Corporation, the company was named "BP Amoco". After a single year of joint operations, the company drop the Amoco name and BP now stood for "Beyond Petroleum". The company is regarded as one of the oil, natural gas and petrol leaders in the world. In the 2006 Fortune Global 500 list of companies, BP was ranked 4th in the world for turnover with sales at $268 billion which was down from 2nd in 2005 and 1st among oil companies the. The 2006 Forbes Global 2000 ranked BP as the 8th largest company in the world with profits in 2005 amounting to $22.341 billion. The number of service stations stood at 28,500 with 15,900 based in the USA alone. Proven reserves amount to 18.3 billion barrels of oil and gas (57/43 percentage distribution). The company is active in 26 countries with production activities in 22 of them. (BP, 2006b) Methodology In this paper, we will be comparing which company between LUKOIL and BP is more investment equitable. BP, having been in the business since 1889 (Amoco), has established itself as the foremost leader in the global oil industry as we have seen in the company's profile. However, as we will be seeing later, LUKOIL has seen a tremendous growth in performance. The BP, being well established in the industry, has certain advantages over LUKOIL such as business management expertise honed by years in the industry and a larger market share and production capacities. But this edge may very well be overcome with the current performance of LUKOIL. To determine which of the two will be more equitable, we will be looking into the financial health of the company especially the equity returns. We will also be considering the economic trends and the political factors that affects the profitability of LUKOIL and BP as these are major determinants of the risk involved in investing in the company.. Special focus will be given to the developments in Russia, which have contributed to the tremendous growth of LUKOIL. Equity Profile LUKOIL Return on Equity Profile (LUKOIL, 2006c): 2001 2002 2003 2004 2005 Equity, mln USD 12,385 14,000 17,472 20,811 26,804 Net Income, mln USD 2,109 1,843 2,571 4,248 6,443 Return On Equity, % 18.4 14.0 16.3 22.2 27.1 BP OIL Return on Equity Profile (BP, 2006a): _________________________ 2001 2002 2003 2004 2005 Equity, mln USD 63,251 68,254 75,524 81,456 86,647 Net Income, mln U

Managing across culture Essay Example | Topics and Well Written Essays - 2500 words

Managing across culture - Essay Example The aspect of culture can also be used towards supervising locally recruited employees. Samovar, Porter & McDaniel (2009) posit to the effect that understanding the mode of communication within a business culture is an asset for proper and peaceful interaction of business people and the locals. In order to excel in business, it is important to have the right cultural facts about the citizens living in a particular society. This helps business to design its strategies so that they are able to absorb the cultural shocks that may emerge in the course of their activities. Cultural shock is a concept which entails that â€Å"any move from one country to another will create a certain amount of confusion, disorientation and emotional upheaval and this is called culture shock,† (Robbins, 1993, p. 78). ... This reflective report will try to provide detailed information regarding hierarchy, gender roles, communication and relationship, greetings, and social interactions in US which can affect a business venture I intend to set in this country. A conclusion based on the findings of secondary research will be given at the end of the report. Business Culture of United States United States is the third largest country in the world and it is one of the best performing economies across the whole world. It borders with Canada, Mexico, pacific, Atlantic oceans, and Caribbean Sea and its population in the year 2007 was estimated to be 301,139,947 (Moran, Harris & Moran, 2010). There are many ethnic groups in the US and it is believed that the whites occupy the largest percentage of about 81.7% while other groups such as black occupy 12.9%, Amerindian and Alaska 1%, Asian 4.2%, and Hawaii and Pacific Islander 0.2% (Moran, Harris & Moran, 2010). Research has shown that United States has a wide ran ge of cultures hence most people who stay in America have their ancestral connections that belong to another culture. In most cases, their ancestral cultures are in Scotland, Germany and Ireland. A comprehensive analysis of cultural diversity has been done by Geert Hofstede who found that national culture has a major impact on employees’ work related values and attitudes (Robbins, 1993). He found that managers and employees vary on five dimensions of national culture namely individualism versus collectivism, power distance, uncertainty avoidance, quantity versus quality of life as well as long term orientation. According to studies, rich countries like the US are very