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Exxon Mobil Falling

Production Problem-By Group P1 Umang Sharma

Shalabh

Shah Savan

Sudip Kar

Kirti Mishra

http://upload.wikimedia.org/wikipedia/commons/1/18/Exxon_Mobil_Logo.svg

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Exxon Mobil A brief overview

American Multinational Oil & Gas Company

Formed in 1999 by Merger of Exxon and Mobil

Ranked No. 2 on Fortunes 500 list for 2010

largest of the six oil supermajors Produces 3% of the worlds oil

3 operating divisions1.Upstream

2.Downstream

3.Chemical Division

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ProblemStatement

The production has fallen consistently from2006 to present

Raised questions about growth

Long-Run decrease in Revenue & Profit

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Behavior Over Time Graph (BOT)

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BOT Variables Used

ProductionOperating CostRevenueProfit

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BOT Counterintuitive Behavior

PRODUCTION

OPERATIONAL COSTS

REVENUE

PROFITqExpected:

Decreasing Margins

Decreasing Profit

Decreasing Revenue

qActual: Opposite is observed COUNTERINTUITIVEBehavior

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Reasons for COUNTERINTITUITIVEBehavior

Hike in world-wide Oil Prices in 2006-2008

Margins Increased

Losses due to fall in Production and rise inOperational Cost recovered

Revenue and Profit Rise

*Put Chart Here*

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Reasons For Falling Production

DEPLETING RESOURCES

POLITICAL REASONS

INCREASING DEMANDS Of RESOURCE-RICHCOUNTRIES

COMPETETION FROM CHINA

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Stake Holder Map

Exxon Mobil

Community Government

Media

Economic

Internal

EnvironmentCustomer

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Stakeholder ChartINTERNAL COMMUNITY Managers - Local Residents Share Holders - Property Owners Workers - Local Businesses

ECONOMIC ENVIRONMENT Commercial Banks - Local environment OPEC - Ocean Environment

MEDIA GOVERNMENT Newspaper - Income Tax Department Television - Ministry of Petroleum Internet - Ministry of Transport - Ministry of

EnvironmentCUSTOMER Countries Organizations

Automobile drivers

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Identifying Stakes

E co n o m ic:OPEC Best means for safeguarding the OPEC

country s interests and also ensures thestabilization of prices in international

oil markets

:nvironmentAffects the surroundings and local

.environment

Customers:Country Imports and Exports of oil and oilrelated products

GovernmentCollection of duties from the revenues

. .generated Controlling import and exports

Internal:Employees manages and perform various task

.of the company

CommunityThe company provided employment to local

residents and help in developing the.overall local surroundings

MediaMarketing and promotion of company s

.product

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Power Vs Stake Grid

PowerStakeormal orVoting Economic Political

Equity ManagersShareholders

Workers

Economic Commercial Banks Income tax DepartmentInfluencers Community OPEC

MediaMinistry of petroleumMinistry of

Environment

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Causal Feedback Loop Analysis

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Questions?