Chevron - An Environment on the Decline (Individual Case Study)

With the recent price declines in the crude oil and natural gas industry, many oil companies are scrambling to determine an appropriate course of action to handle this environmental disruption. Chevron has a healthy financial disposition but is not immune to the effects of this change in the environment. The company appears to be on the decline, in the blinded stage, still trying to determine what action to take to appropriately correct their course.

The following paper provides 3 recommendations for course corrections that Chevron can take to attempt to mitigate the issues presented with the decline of crude.

https://drive.google.com/file/d/0B-JO-ElWID1Bb3lUcHZWNFo3VkU/view?usp=sharing

Money on the Mind - Implications on Decisions Making

As part of the course we were asked to watch a video, Money on the Mind, that reports on studies done at Berkley. The studies were all related to how people act based on their wealth and how people's behavior changes when someone socio-economic status is modified either in pretend or real experience. The studies suggest that when a person has a high wealth, they are less considerate of others and feed into a sense of entitlement, neglecting all the factors that placed them in the position of wealth.  The studies also showed that when a person was closer to poverty they were more apt to share what they had and were more polite and humble.

A few decision making implications that come to mind from this video include the following list. When wealthy make decisions, they will likely look to create direct benefits for them and not the organization as a whole. However if you expose the person to a simulated or actual poverty level you maybe able to recalibrate them to make decisions in the best interest of the organization and the employees. Wealthy decision makers will also be ok with or prefer win-lose situations instead of win-win situations that can create problems for an organization with suppliers, the labor force, or clients.

The video also discusses that those who are wealthy having the sense of entitlement at work are more likely to steal from work, engage in unethical behavior (the rules don't apply to them), and lie. If you are negotiating with someone who is wealthy, you might want to approach with caution as it will be difficult to determine whether or not they have everyone's best interest in mind or only their own. I would say knowing someone's socio-economic status before going into a negotiation can give you a tactical advantage. If they are wealthy you know they are going to be looking out for themselves more, but even a little exposure to poverty might recalibrate them. If you know this and can force the wealthy person into a simulation or otherwise expose them to poverty, you might be able to make them re-evaluate their own decision making process prior to a final decision. However, if they are closer to poverty they are more likely to give more in negotiations toward the betterment of both organizations.

Culture Exercise - Module 10

The four culture types discussed in the Org. Theory text are adaptive culture, mission culture, clan culture, and bureaucratic culture.  The culture exercise from module 10 asked that you rank eight different statements related to your preference for an organization's focus that would best determine your preference for one of the above cultures. After ranking mine I found that my lowest score (highest preference) of 4 was for the adaptability culture, where my highest score (lowest preference) was tied at 12 for mission culture and bureaucratic culture. The clan culture was somewhere in between with a score of 8.

The adaptability culture does resonate with me. I believe that taking weighted-risks and focusing on improving situations is positive for an organization. I like flexibility in work as it prevents me from becoming bored with routine tasks. As a result in my former positions I have been the agent for quite a bit of change with a focus on improving process efficiency, which ultimately made for a happier customer.  I also really like being able to help internal and external customers achieve their goals, while creating win-win situations for them. I believe that the most attractive component of this culture is that the freedom to change exists and that employees are empowered to help compel that change.

My lowest preferences (highest scored) from this exercise were mission culture and bureaucratic culture. Both of these cultures share a stability aspect. I do like stability but believe it to be, on many levels, boring. I do like the idea of a flexible work environment, and benefits that come with not having to have an 8 to 5 job that is just part of some process. I find little interest in doing repetitive tasks the same way that was defined by a group who had no imagination of how a system could be more efficient and effective.  However, if I found myself in this sort of an organization then I would be pushing for innovations with reasoned arguments that make a case for change.

Chevron Organizational Complexity

Chevron Corporation is a very complex organization and has relatively high levels of both vertical and horizontal differentiation. The company's complexity is a fit for their environment, configuration, strategy type, and organizational goals. To review an analysis of the organizational complexity for Chevron see the following link.

https://docs.google.com/document/d/1hatg-Klh0g2b-7vh6HoCiLiWCbHxXLsqg5SaILqi8wo/edit?usp=sharing

While preparing for doing the analysis, I researched the current organization break down at the top level. See the following graphic for the organization chart. Click the graphic to see a larger version.

Chevron Corporation's Organization Chart

Chevron Environmental Complexity

Chevron operates in a complex unstable environment. The linked document below reviews the many sectors that influence chevron, as well as examines the environmental complexity for the organization.

https://docs.google.com/document/d/176xWrRQCvXM3lstn250_wOblizpQKwQRL3bd2dLL_pc/edit?usp=sharing

Chevron SWOT

 A SWOT is a common tool used in strategic planning for organizations, and helps understand the bigger environment which the company is in and leveraged to operate. The SWOT looks at the Strengths, Weaknesses, Opportunities and Threats that an organization has or faces. The strengths and weaknesses represent internal organization state, where the opportunities and threats represent the external environment that the organization operates in or desires to operate. 

Chevron Corporation is an integrated energy company that spans the globe. The following graphic represents a SWOT analysis that has been applied to the company.

The following is a link to the document that helped develop the above graphic, hosted in Google Docs. Chevron SWOT

Robotic Builders Inc. Members Newsletter

Letter to Robotic Builders Members

Greetings Robotic Builders Inc. Members,
 As a result of your continued enthusiasm we have been on a giant growth streak. We have been successful in efforts to commercializing some of your fellow distinguished members creations. We are proud to introduce a new product line that you all might be interested in building. It is the first RoboKit we are unveiling that you can put together called the Dawgone Dog Walker. This highly sophisticated robot, can help you take your dog for a walk and can be put together in any of our fine Robotic Builders Gyms.  We are also pleased to announce that due to popular demand, we will be expanding our operations to Japan, so that they can join the ranks of our expert builders.  We will bring a few Gyms online there and also expand our franchise opportunities to interested parties there. Finally we are happy to let you know that we will be acquiring Circuits On Demand, whose web based design tools allows you to quickly make up a circuit board and have small batch jobs produced and shipped to you.  We look forward to all the new ways we will be able to serve our valued members.

Sincerely,

Walker Wheeler
President and CEO of Robotic Builders Inc.

Robotic Builders Management Team

Management team,
 Below I have outlined how we are going to modify our organization structure to help facilitate all the changes and challenges we are taking on. Please see my notes about each item to understand how we are growing.

1) Your organization added a new product or service line.

Robotic Builders Inc. has now added their first RoboKit that can be assembled in our gyms or at home. To undertake this product line we have to expand into manufacturing and product distribution, which will result in a new functional area that reports to the CEO. We hope you get to see them in general distribution at a Radio Shack near you within the year.

2) Your organization grew to become an international organization. If is already international, then it expanded to a new region.

With our expansion into Japan, we will need to re-evaluate how we do operations and franchising. Since there is such a difference in culture and desired experience between the markets of North America and Japan, we will add regional operations managers under our current VP of Operations and Franchise. Hopefully this separation will help bring maximum value and effectiveness to the respective regions.

3) Your organization bought and merged with another organization (with not so similar products or services). What type of organization would this be and how would the merger look at the organization's structural level? 

Finally our acquisition of Circuits on Demand is going to have some functional areas that overlap with our new RobotKits division. In addition to the manufacturing and distribution that both lines of business have, Circuits on Demand also brings a highly skilled software development team. Since these business lines largely overlap and Circuits on Demand may experience slow times, we can combine these areas to improve efficiency. The operation will be large enough to justify a direct report to me. Please see the revised organization chart for a better understanding of the coming changes.

Sincerely,

Walker Wheeler

Robotic Builders New Organization Chart

E&E Handout - Chevron

The company that I have selected to analyze for the course is Chevron Corporation. The following section attempt to answer the questions from the E&E handout related to this specific corporation.

E&E Handout Questions

What does the organization do? What is its major work activity?

Chevron is an integrated energy company. For this company their primary activities center around oil and gas. They are involved in the are exploration, production, refinement, and distribution of oil and gas in various locations around the world. The company has other activities that are not included here.

How does the org score on efficiency?
1 2 3 4 5

Since efficiency focuses on inputs, use of resources, and costs, Chevron would come in at a 5. They utilize several automated control system to produce, refine, and distribute their inputs. Additionally since they are controlling the resource from the capture through to the end product, in many ways they could not be more efficient. The only area that in their core business that they would score a lower efficiency is in the exploration part of their business. The environment (on shore, shallow offshore, or deep offshore) in which they are exploring contributes to the efficiency and does not always produce in the end.

How does the org score on effectiveness?
1 2 3 4 5

Chevron tends to display high levels of effectiveness. They continue to generate large revenues based off of their operations year after year. They continue to make a high quality product with arguably no deviation. A rating of 5 in effectiveness would be appropriate for this company.

Where would the organization like to be in the graph?

Chevron is where it would like to be on the graph. The both strive for efficiency and effectiveness. They fit in high and to the right of quadrant D, and want to keep their organization there.

Does the position correspond to the vision and mission statements of the organization?

The Chevron Way is an attempt to provide a vision, mission, and sense of corporate culture and accountability for the organization. There vision is to to be the global energy company most admired for its people, partnership and performance. Focusing in on the last word, performance, we can see the position on the graph is where they are striving to be. 

My Dream Job - Robotics Builders Inc.

Company Description:

Having a high desire to work in the field of robotics some day, I think my dream job would be running a company that empowered people to work on robotic creations of their own. The company would have two lines of business. The first would focus on empowerment of the membership. This focus would make available to our members high tech equipment, tools, related resources, and space.  The company business model would be similar to that of a modern gym in this focus. Clients would sign up for a membership and be granted access to the facility with the equipment and space to work. Clients could pay for one ore more value added services including storage space or raw material. The second focus for the company would be commercializing the creations of clients in conjunction with the membership. This value added service would help the clients patent, produce, or sell their creations. The membership would periodically be invited to compete in challenges that the company issues, to develop specific robots for company partnerships. The winner would receive cash prizes, while the company would retain a portion of intellectual rights to the entries submitted. 

Company Structure:

The company organization structure once up and rolling would likely look similar to the following, but the growth of a company like this is natural and organic so I'd expect the end picture to change in time. 

The VP of marketing would be in charge of determining where to expand and what to promote to different geographic regions. The VP of Operations & Franchising would oversee all company owned locations as well as the franchises that are sold to other robotic enthusiasts. Franchise owners and general managers represent the two large groups that would report up through the VP Operation & Franchising. The VP Intellectual Property & Commercialization would lead the organization in commercializing the memberships' intellectual property creations. Finally the CFO would make sure that we were able to maintain liquidity and solvency. 

Company's Operational Goals:

The operational goals for Robotic Builders focus on our membership, employee development, growth and overall performance. 

1. Franchise 5 new store per year.
2. Commercialize one new robotic creation every quarter from our membership.
3. Create two challenges for our membership a year, from partner based needs.
4. Grow overall profitability 8% a year. 
5. Inspire and train new employees on current techniques for building robots, so that they may inspire our membership.

Introductory Biography

Hi Everyone,
 I created this video for an introductory biography in the MBA 617 course at UAF. It is far from perfect, but I took the time to add captions.

Thank you,

Walker