Exxon Mobil Corporation (Exxon Mobil) is an integrated oil and gas company based in the US. It is engaged in exploration and production, refining, and marketing of oil and natural gas. The company is also engaged in the production of chemicals, commodity petrochemicals, and electricity generation. The company operates across the globe. It is headquartered in Irving, Texas and employs about 80,000 people.
Exxon Mobil operates through three segments: upstream, downstream, and chemicals.
The upstream segment explores for and produces crude oil and natural gas. The company’s upstream business has operations in 36 countries and includes five global companies. These companies are responsible for the corporation’s exploration, development, production, gas and power marketing, and upstream-research activities. The company’s upstream portfolio includes operations in the US, Canada, South America, Europe, the Asia-Pacific, Australia, the Middle East, Russia, the Caspian, and Africa.
The company’s downstream activities include refining, supply, and fuels marketing. The company’s refining and supply business focuses on providing fuel products and feedstock. Exxon Mobil manufactures clean fuels, lubes, and other high-valued products. The company has interests in 12 lubricant refineries and manufactures three brands of finished lubricants (Exxon, Mobil, and Esso) through interests in over 31 blending plants. The fuels marketing business operates throughout the world. The Exxon, Mobil, Esso, and On the Run brands serve motorists at nearly 29,000 service stations and provide over one million industrial and wholesale customers with fuel products. Fuel products and services are provided to aviation customers at more than 630 airports and to marine customers at more than 180 marine ports around the world. The company supplies lube base stocks and markets finished lubricants and specialty products.
The chemicals division manufactures and sells petrochemicals. Exxon Mobil Chemical is an integrated manufacturer and global marketer of olefins, aromatics, fluids, synthetic rubber, polyethylene, polypropylene, oriented polypropylene packaging films, plasticizers, synthetic lubricant base stocks, additives for fuels and lubricants, zeolite catalysts, and other petrochemical products.
Success Story
Horizontal merger between Exxon and Mobil, result in 23% increased in market share, according to Fortune 500, ExxonMobil, stands at No1 position in 2006, further mergers are crucial components for the company’s survival and growth in the long term.This deal is one of the biggest,successful and most crucial merger ever happened ,against a whopping amount of $73.7 billion.
ExxonMobil adopted a balanced scorecard strategy. In general, however ExxonMobil adopted the differentiation strategy with their operational efficiency. ExxonMobil sought to attract customers that are willing to pay additional premiums for their products and at the same time improving efficiency in the supply chain in order to reduce cost. Moreover, ExxonMobil has focused on its strengths on its core business research and development to e-business and venture capital activities.
ExxonMobil, venture to a complete new strategy, apart from their core business such as gasoline related products. ExxonMobil encourages its customers to purchase goods from its convenience stores apart from filling gasoline in the ExxonMobil gas station. Second, with its superior buying experience, the company has also able to provide convenient and fast service, hygiene restrooms and friendly employees to its customers. This exceptional service has made the relationships with its customers to become more bonded than ever before.
Innovations in ExxonMobil
ExxonMobil is a greatest industry in the world in terms of oil extraction and production and the business volume is mainly based on oil. World’s prospectus in oil and petroleum products is drastically changed. Consumers are more aware and interested in the renewable energy source. While the people were always talking about the innovation and innovation and the ExxonMobil had nothing to do despite of its billion’s of dollar. The management thus thought to approach the business in different way which would base on technology and innovations. Since the consumers were searching the alternatives of petrol and oil energy where they could stay assured environmentally and personal uses. Some of the socialistic groups which never believed that there is any future of oil and petroleum products as they were badly affecting the personal lives and environment. Their loud voices which was media frenzy and almost everybody was supporting this, ExxonMobil had nowhere to go except recreating them and innovating their classical selling modules, business and ideas. Now it seemed like the ExxonMobil who always wanted to be a leader in energy sector in terms of sales, business, products and innovations as well as technology, was almost same or even gradually losing its image among the consumer level because it was producing, extracting, producing and marketing the highest level of oil and petroleum among all, seemed the major culprit of environmentally disrupting player. They had a challenge with them and if not solved, they were sure to be out of their current leading position.
As it is said that “A leader always wants to remain a leader” and this was enforcing ExxonMobil to get more innovative and technical. Public consumers’ perceptions and the company’s management were the main driving force for all these to happen. From the past, this company did not only sell its brands but also has been advocating the public safety as well. They have been researching, supporting and investing millions of dollars in these issues. ExxonMobil has been talking and working on the issues of climate changes their problems and solutions, advancements in fuel technologies; where consumers can get the efficient fuels in affordable prices, reducing GHG (greenhouse gas reduction) in operations including reduced hydrocarbon flaring, CCS (Carbon capture and storage) technology reducing overall emissions. They have spent more than $100 million in CFZ (controlled freeze zone) technology which ultimately will address the risks in climate change, along with Co2 separations from raw natural gas. Cogeneration is their exciting and ever growing hi-tech innovative approach in producing electricity from raw materials and consumer products; an ultimate scientific recycling process.
ExxonMobil innovations and far citation technologies do not stop there. Their most advancement in vehicle and fuel technology is astounding. They are launching a concept of production the next generation biofuels from photosynthetic algae. This will not be an integral part of pride for the ExxonMobil but also will be shining future in alternative energy source sector. Lithium ion battery technology making a zero-emissions vehicles, new tire lining technology for vehicles tires longevity better fuel efficiency and plastic automotive technology are the another edge of ExxonMobil’s changing world vision.
ExxonMobil innovations and far citation technologies do not stop there. Their most advancement in vehicle and fuel technology is astounding. They are launching a concept of production the next generation biofuels from photosynthetic algae. This will not be an integral part of pride for the ExxonMobil but also will be shining future in alternative energy source sector. Lithium ion battery technology making a zero-emissions vehicles, new tire lining technology for vehicles tires longevity better fuel efficiency and plastic automotive technology are the another edge of ExxonMobil’s changing world vision.
Now, it was a time to come with change in the way to customers and had no options as the newly established oil and petroleum organizations also were coming with at least few publicly demanded issues and this was the threat to ExxonMobil. However, they are always in the favor of changes and innovations, they had not walked dramatically till they brought a concept of bio fuel for an algae. The world was thrilled when it was officially informed that ExxonMobil is not only working to produce the biofuell from algae but also had proved the world that it has worked well in the process. This innovative step of ExxonMobil not only differentiate it and it’s pattern of business from other competitors but also showed and proved how excited and interested the ExxonMobil was about the consumer’s interests, expectations, demands and environmental aware. They not only heightened themselves in terms of business with this but also were successful to win the heart of the consumers.
Strategic Differentiation
ExxonMobil has created the different directories, divisions, groups, units and strategic business units to manage such things within the organization. In support of managing change there should be the processes namely, performance management, where organizations comprises the regular budgeting, monthly reporting, market research, governance, risk management, unintended consequences, performance appraisal etc. thus the challenges are overcome and changes are defined. Governance, where the poorly managed changes are re characterized by unclear accountabilities. Another process is risk management; this is a process of assessing risk in terms of changes outcomes and in terms of risk of disruption associated with implementation of changes. The final process is of solving the unintended consequences. This is a part of risk management while managing the changes but to those issues which need especial or separate treatment .
The ultimate strategy usually involves the quality or performance of the products, cost and price, sale promotion and service, and strength of the sales channels. There are four segments where ExxonMobil’s strategy is working.
Product differentiation: ExxonMobil is spending billions of dollars and investing the great deal of time in researching and branding their products to position it uniquely in the market place e.g. biofuels from algae
Market segmentation: management level of ExxonMobil has cleverly segmented and advertised its products, changes and innovations differently in deferent regions. They have mergers and acquisitions e.g. in India and China.
Price and cost leadership: ExxonMobil is leader in the market because of quality products and affordable prices, however, the prices have been a subject of concern from last few years.
Construction of entry and mobility barriers: this is where ExxonMobil leaves every another company far behind. Its vision till year 2030, hi-tech products e.g. biofuel from algae etc makes competitor difficult to enter the market in same specialty.
These are the strategies that ExxonMobil is applying in managing producing and managing changes within the organization.
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