Executive Summary

The paper focuses on ways that the kanban system can be employed in shaping the operations of Exxon Mobil. Although the kanban system is mainlyapplied in the manufacturing sector, many scholars are of the view that the kanban system canbe used in creatingefficiency in oil exploration and production processes. There is also an evaluation of the strengths, weaknesses, opportunities and threats that face the industry. Both PEST and SWOT analysis provide a clear picture of what needs to be done to shape the operations of the Exxon Mobil.

Introduction

Exxon Mobil is one of the leading energy corporations in the globe and has active operations in both gas and oil explorations. The headquarters of Exxon Mobil is in Irvin, Texas and serves as one of the largest subsidiaries of the John d Rockefeller’s Oil Company. Exxon Mobil was created in 1999 through a merger of both  Mobil and Exon Oil. Some of its flagship brands include Exxon, Exxon Mobil and Esso.  It is worth noting that Exxon Mobil is placed as the 9^thlargest corporation in the globe on the basis of the revenue levels.  Over the years, Exxon Mobil has been successful in registering increased global presenceand equally diversifying its product portfolio.

In 2018, Exxon Mobil was ranked as one of the most profitableorganisations by the Fortune 500.  As of 2017, the company was recorded as producing 3.921 millionbarrels of oil equivalent. The figure accounts for more than 3% of global oil consumption. The success of the organization can be linked to exceptional leadership strategies.  The vision statement of Exxon Mobil is ensuring that it remains committed to delivering premierpetroleum and petrochemical products whileequally adhering to the set regulations.  On the other hand, its mission is upholding safety during the production and distribution of energyproducts as well as offering innovative value to customers.

 

 

3. Strategic Considerations

Exxon Mobil   PEST Analysis

PoliticalFactors

Political; factors influence the stability levels in a  country and thus impacts on the ease of doing business. Cases of political instability would derail oil explorationsactivities and lead to other logistic issues. Likewise, political factors tend to affect trade regulations and tariffs. Exxon Mobil has operations in different countries thus implying that it isexposed to many political risks.

Economic Factors

Macroeconomic factor such as inflation, foreignexec ageand interest rates have significant impacts on businessoperations. Currently, Exxon Mobil hasoperations in different countries thus creating the risk that changes in foreign exchange rates would disrupt the profit levels. On the other hand, exploration in developing countries often come with logisticissues due to the limited economicstructures and limitations like high inflationlevel and volatile exchange rates.

SocialFactors

Many people tend to critique gas companies like Exxon Mobil on the basis that they impact negatively on the environment and lead to the spared of chronic health conditions. It implies that Exxon Mobil must undertake to ensure that it takes part in the improvement of social structuressuch as building schools, recreational facilities and offering employment opportunities to the local communities.

Technological factors

Technological innovation impacts on the efficiency and costincurred in the production processes. Under the current setting, the oil sector is becoming integrated with other global players. Not only do technological innovations help reduce the operational costs, but that also ensure thatExxon Mobil has a competitive advantage over other market players.

 

Exxon Mobil   SWOTAnalysis

1. Strengths

• Exxon Mobil has a strongbrand reputation thus creating credibility, trust and credibility among the customer base.
• The diversifiedportfolio helps counter the threat of new entrants and rival products
• Exxon Mobil has an effectivecorporate social responsibilityinitiative that creates a harmonious environment with itsstakeholders.
• The organization is highly innovative and has in the past broadened its product portfolio and other initiatives to address the needs of the customers.
• Exxon Mobil has a strong global presence and networks thus making it’spossible to push its products in the global market.

Weaknesses

• Manyenvironmentalists are of the view that Exxon Mobil is not doing enough to protect the environment
• The rising petrol prices have positioned Exxon Mobil in the mind of the customers and other stakeholders as a greedycorporate.
• The company is yet to develop diverse alternative energies that have minimal impacts on the environment.

Opportunities

• There is an ongoing increase in the demandfor energy products in most of the developing economies thus offering huge prospects for the company
• There is theoption of venturing in the alternative sources of energy such as electric and solar energy
• There is the chance of shapingits image by ensuring that it adheres to the set regulations and involves the local communities in decision-makingprocesses

Threats

• Many players in the energy industry are coming with alternative sources of energy, therefore, creatinga risk to Exxon Mobil.
• There is an increase in the number of environmental regulations that Exxon Mobil must conform to as well as ensure that it does not negatively impact on the local communities.
• The economic recession in both developed and developing countries often have adverse impacts on the oil market.

 

 

4. Process Steps

Although the kanban system is widely used in the manufacturing sector, it is critical to note that it can also be applied in shaping the operations of Exxon Mobil. The kanban system is based on the need to enhance both efficiency and profitability through minimization of wastes.  In most cases, the process of drilling and exploring for oil is cost intensive and lowers the profitability levels of Exxon Mobil.  The oil and gas industry serves as the backbone of the economy, and there is thus the need to ensure that there are increased efficiency level and reduction of the operationalcosts. The concept of kanban system has spread in many industries and has the benefit of lowering down the costs of doing business and operationalprocesses.  Some of the  issues that will be addressed by kanban system include

Overproduction

Overproduction can be regarded as being a waste in the operationalprocesses and lead to an increase in operational costs such as storage.  There is also the risk that a huge amount of money may be tied with overproduction thus limiting the ability to engage in other profitable ventures. Nonetheless, the kanban system will ensure that Exxon Mobil is in constant knowledge of the market demand levels and what to producefor each market.

Inventory

Just like other business, many inventoriesare required in the gas and oil sector. There is thus the need to have adequate control of all finished goods, work-in-process and raw materials. The planning of the listed elementswill come in handy in ensuring that there is the leveraging of all oil production processes. Kanban system will seek to minimize the operational costs and other problems that come with extra inventory.

Motion

The motion refers to the movement of workers and machinery during the production processes. Delays and unwanted movements may have the effect of increasing the operational costs as well as creating otherproblems.  Most of the wastes in the energy sector are linked to poor planning, lack of supervision and lack of proper housekeeping. However, the kanban system ensures that every facet of production is addressed.

 

5. Process Context:The McKinney’s 7S Model

Strategy

The strategy requires that the Exxon Mobil come up with methods to deal with the issues facing the energy sector. It requires that the management put in place measures to increase the development of alternativesources of energy. The kanban system can lead to the attainment of this objective by preparing the corporationfor the changes in the industry.

Structure

There is a need to have an elaborate structure that outlines the duties and responsibilities of all workers. The requirement is in line with the kanban system which stresses the need to minimize the levels of wastes. Rather than focusing on the hierarchicalstructure, there is the need to have a vertical structure as it will ensure that there are cooperation and integration at all levels.

Systems

The kanban system serves as one of the measures that will ensure that there is the smooth functioning of the Exxon Mobil processes. It serves as internal support of ensuring that there is a reduction of wastes as well as the attainment of the set objectives. Under the current setting, there is a growing need for the need to modernize operations as well as ensure that there is better integrationamong all stakeholders and departments.

Style/Culture

Style and culture refer to the dominant values and beliefs that shape the processes of the organization. Both the mission and visionstatements of the Exxon Mobil Corporation are based on the need to ensure that there is the delivery of a reliable and safe source of energy. The culture of the group thus needs to be based on the need to improve the welfare of the stakeholders and the customers. The objective can be attained by adhering to environmental regulations.

Staff

The staffs play the role of implementing the policies of the groups and must thus have the right training. Stable relationsbetween the management and the workers will further ensure that the organization attains its objectives within a short period.

SharedValues

There is the need for all members t9o have common values and objectives. There is a growing need to address the environment; issues that come with the use of carbon-based fuels. The organization, therefore, need to have the shared values of taking care of the environment as well as transforming the energy sector.

6. Measurement

The efficiency of the processes will be attained by an evaluation of the impacts that the organization has on the environment as well as its profit levels. The kanban system is effective in reducing the levels of wastes and errors thus increasing the profit levels. An increase in the profit levels will serve as an indication that Exxon Mobile has effective strategies and competitive advantage of other market players. Likewise, the diversification of itsproducts to include alternative sources of energy will come in handy in the reduction of wastes.

 

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