ANALYSIS- A SUSTAINABLE BUSINESS SCENARIO IN 2060
Analysis- A Sustainable business Scenario in 2060 3
Introduction 3
Business Scenario 2060 5
Relating the 2060 Scenario to today 8
References 10
Analysis- A Sustainable business Scenario in 2060
Introduction
A scenario is a consistent and orderly description that has a logical flow of different hypothetical characteristics about the past, present and future developments activities of an organization. The definition infers that a scenario gives business the basis on which management would take the robust actions to sustain the business operation. Rosneft Company based in Russia is my selection company. The scenario indicates the future situation of the business. Rosneft is a leader in Russian energy sector regarding revenue generation (Krewitt et al., 2007, p. 4970.). The business is bringing good incomes but with proper planning, the company would lead in all the technology using in extraction, processing and distribution of oil and gas products in the world.
This report covers that scenario of business by analyzing the current status of the company and working hard to make the company sustain performance in the competitive market. The business scenario discusses Rosneft Oil and Gas Company. The company is chosen for it has the potential to remain operational up to 2060 and beyond. The business scenario is illustrated bringing to light some sectors that require improvement to reach that extended period business situation. The other part covered is that part of comparing the current business and the situation. What should be done to achieve the set future standard?
Sustainability Situation Analysis in 2060
This report presents the trade case for Rosneft Oil and Gas Company in Russia. In the entire world, Rosneft remains the largest public oil company in terms of possession of hydrocarbon reserves and the hydrocarbon output. Choosing this company is associated with the future in this endeavor. Analysis of its future sustainability is valid. The company is seeking to demonstrate the excellent revenue performance is contributing significantly toward the development of Russia as a Federation (Sørensen, 2008, p. 449). Through employment creation, the company is continually improving the living standards of Russians. The project is geared towards analyzing the future development strategy of the enterprise in the next forty-five years. This report would explain the sustainable company growth through the advocacy of efficiency and collaboration business. The collaborative ventures with other firms are a strategy for development and widened the market.
The external sustainability of the company includes technology use and innovation. A full analysis of the situation of the business, the external forces that affect the company is considered. To begin with; technology is critical in modern business. It has enabled companies to gain competitive advantage. The home country of this Rosneft is Russia and the technology they have in drilling oil and selling gas is highly rated hence they will end up dominating the market if fully utilized. Foreign investment is another force that ensures the company sustainability goals are achieved. Good relations with other countries attracts the company to have widened its market. The business scenario provides that the company led in sales, and the only way to increase sales is through broadened market.
Business Scenario 2060
A scenario involves sensitivity analysis where companies set up the goals and the strategies to achieve the goals. The company is in the oil and gas industry and additionally it is leading in this industry in Russia. To project where this company would be in the future, it is important to develop a scenario that reflects the place of the enterprise in the next 45 years. The business scenario analyzed in this report is that of “liberalizing window business.” The company has shown potential in production using this scenario of activity (Krewitt et al., 2007, p. 4973). The key driver in this situation is that the firm is indeed encouraging foreign investment in an open platform with the company while keeping the highest number of shares for the government.
The Liberalizing business scenario. A Liberalizing Window scene represents the vision that Rosneft has for the future. It clearly demonstrates the ideal vision that the company has towards the west, which will allow Russia to develop economically. It also creates an environment of interactions where the company will help the nation to have good relations with the Western countries and the rivals (Turton, 2006, p.115). The scenario allows the market forces in the energy industry to remain predominant, as the state power over the business is partially withdrawn. The scenario is indeed very ambitious. The situation is open and actively attracting foreign investment in the industry. The situation is not allowing more industry consolidations. It clearly states that enough is enough no more consolidations. The production is projected to look accelerated regarding production.
The scenario allows faster growth in the exportation of gas and oil to other nations. Coming up with the open policy to allow the business interact with western countries will help the company widen the market for its products. The scenario is attracting partnership in a business where the Russian government will collaborate with other nations in Europe and America. The companies would build the broken relations between the Russian government and many other countries. With this scenario, the company is in a position to move the economy to the next level. The economy of Russia is affected by the energy sector, which has proved to be generating big revenues. Having a diversified economy would allow the economy grow rapidly as it will not depend entirely on energy alone (Baard et al., 2012, pp. 651). Coming up with the scenario that is will not be dependent on the economy would create more room for the company to make strategies that are customer based to offer what the market is demanding.
Innovation Science in the enterprise. Rosneft has been leading in the use of technology from production all through to distribution. The company needs to keep on improving on technology used to implement the scenario developed. Moreover, the company needs to adopt innovations by students and many researchers to achieve technological leadership in the energy sector. The line of change to make the company lead in technology are the innovative equipment used in extraction (Turton, 2006, p. 117). The company management and the employees are expected to be trained on modern techniques so that they can gain skills and improve business performance. The innovation development program for Rosneft is geared towards making every process to adopt a new method of operation.
The innovation concept is a sustainable development program for the company. Every operation of the company will be current and up to date attracting even other companies to consult with us. To achieve this, the graduate projects that are in line with our business operation would be rewarded and incorporated into the enterprise service. Replenishment of the reserves owned by the company and high efficiency would be the indicators of technology utilization (Blowfield, 2013, p.109).
Policies and Governance. The policy choices that the corporation is making based on the PESTLE Analysis and SWOT analysis have long lasting effects on the enterprise. The third party intervention to the business allows them to have access to the pipeline system that is owned by the government. The policy that allows the company to have independence from the government to allow foreign investors to come in and invest at Rosneft. The current Rosneft retail network strategy remains critical to the growth and sustainability of the company. The company intends to increase direct sales to its customers to achieve the retail network. The system is incorporated with added value products that are of high quality. Reaching the final consumer of the company’s products remain critical for the strategy. The current filling stations of 2,571 need to rise to about twenty thousand by the year 2060 across the globe (www.rosneft.com. 2016, para. 27). The already operational stations are bringing significant revenues o the company and with an increase in the retail networks, the company will have to achieve the strategic goal.
The corporate governance of the enterprise is to have high standards with the aid of the development strategy that is indeed increasing the shareholder value. Hilyard (2012, p. 25) reports that the company believes that investors’ confidence in them can rise by increased commitment to business operations in a transparent manner. Strategic management decisions are made by the BOD and are always for the best interest of the shareholders. This type of governance allows the business to attract investment because the company values shareholders in decisions they are making (French, Rios, and Stewart, 2011, p. 6). The management system operates in line with global standards for economic efficiency. The increase in the production of gas and petroleum assures the company that there is still demand for its products. It is through acquisition and merging with other enterprises that the firm would reach many buyers across the world. For increased export efficiency, the company intends to come up with more strategic export terminals. The current terminal has made the company have ease of planning on production. They have full information about the demand and the prevailing market situation.
Relating the 2060 Scenario to Today
Climate change is the topic of discussion in every part of the world. To some extent, the company is affected by the situation. Most of the ice is melting because of the increased temperatures due to carbon gasses in the air. The mining activities along the shows are currently affecting the mines along the shores (Carlsen et al., 2013, p.1247). Transportation of their products through the sea is also highly affected hence the reputation of the company in the world trade is highly affected. Dahl (2015, p. 49) notes that the climate change is still increasing hence warranting the comparison of the situation with the scenario in 2060. Therefore, the company needs to offer some solution to make the future scenario a success. The government of Russia is indeed getting huge revenues from Rosneft operations. The company policies are in line with those stipulated by the government. Government policies are allowing the business to extract oil and process solely to obtain final products for domestic and export compared to the work scenario in 2060 when the corporation will involve many foreign investors to the enterprise.
The policies in the business scenario allow the company to have increased international cooperation for widened markets. The scenario targets to increase the stations to a double number for more inputs. The strategic business location is paramount in taking the business to the next level of high incomes. Policies in the Russian government are restricting foreigners from coming into the company because it is a state-owned corporation (Csomós, 2014, p. 2783). Changing the policies in the future to allow other people to come in is critical for implementing the business scenario. The business of oil is going global the status of the company is not yet to world standards. The situation is geared towards globalizing the company. The main feature of the situation is that of liberalization. It is key in going global for any business. The freedom of the enterprise to establish itself and be a leader in the energy sector around the globe is achievable through the scenario.
Currently, the government has some control over Rosneft. The government control hinders free trade between the company and other nations. The situation developed is allowing free trade where integration of markets is practical. Independence of the business operation (Kainuma et al., 2004 p. 713). Currently, the company is not utilizing research as they believe petroleum is an essential product that does not need advertisements. The scenario allows the company to have its database that contains all the trends and future trends in the energy sector. The Company’s Management will be able to project the profits they expect despite the move towards green cars. With technology and the environmental concerns, the company is not currently involved in corporate social responsibility. This entails coming up with projects that shape the environment and help the society, and it will assist the community to continue to accept the company products in the competitive market.
Today the company has few joint business ventures that are agreed on after every two years. The last joint venture that the firm went into was that of BP regarding the shares of 5.66 percent in that company. This makes the company have a say in the decision-making process of BP. The other venture is that of Exxon Mobil and Gazprom (Sørensen, 2008, p. 456). These investments are critical in building the basis for future company sustainability. The scenario is set for 45 years from today. This period is long enough to give management room to change some strategies that are not leading to the achievement set goal. A thorough market research is critical to making best decisions. The company would adopt the concept of business analytics to achieve most from the company.
References
Baard, P., Vredin Johansson, M., Carlsen, H. and Edvardsson Björnberg, K., 2012. Scenarios and Sustainability: Tools for Alleviating the Gap between Municipal means and Responsibilities in Adaptation Planning. Local Environment, 17(6-7), pp.641-662.
Blowfield, M., 2013. Business and Sustainability. Oxford University Press, pp. 106-113.
Carlsen, H., Dreborg, K.H., and Wikman-Svahn, P., 2013. The tailor-made scenario is planning for local adaptation to climate change. Mitigation and Adaptation Strategies for Global Change, 18(8), pp.1239-1255.
Csomós, G., 2014. The relationship between large oil companies and the renewable energy sector. Environmental Engineering and Management Journal, 13(11), pp.2781-2787.
Dahl, C., 2015. International Energy Markets: Understanding Pricing, Policies, & Profits. PennWell Books, pp.46-57.
French, S., Rios, J. and Stewart, T.J., 2011. Decision analysis and scenario thinking for nuclear sustainability. Working Paper.
Hilyard, J., 2012. The Oil & Gas Industry: A Nontechnical Guide. PennWell Books.
Kainuma, M., Matsuoka, Y., Morita, T., Masui, T. and Takahashi, K., 2004. Analysis of global warming stabilization scenarios: the Asian-Pacific Integrated Model. Energy Economics, 26(4), pp.709-719.
Krewitt, W., Simon, S., Graus, W., Teske, S., Zervos, A., and Schäfer, O., 2007. The 2 C scenario—a sustainable world energy perspective. Energy Policy, 35(10), pp.4969-4980.
Sørensen, B., 2008. A sustainable energy future: Construction of demand and renewable energy supply scenarios. International Journal of Energy Research, 32(5), pp.436-470.
Turton, H., 2006. Scenario and Policy Analysis of Sustainable Energy Systems and Automobile Transportation (Doctoral dissertation, University of New South Wales, Australia), pp.113-121.
www.rosneft.com. 2016. Rosneft at a Glance. [Online] Available at http://www.rosneft.com/about/ [Accessed 6 Jun. 2016].
