Chevron Value Chain Analysis

Chevron is a world’s well known foremost integrated energy companies with businesses of exploration and production of crude oil and natural gas, manufacturing of products, chemical and transportation and other businesses such as power generation and technology operation. In this essay, discussion on how Chevron understands the customer needs allow it to concentrate on the strategies and procedures can fulfil the needs. The value which created by Chevron recognizing the environmental trends such as the quality and safety of the people and the environment will also be discussed in this essay. In addition, there will also be arguments on Chevron’s primary activity that focus on manufacturing and fabricating high quality products to generate energy …show more content…
Chevron focuses on the key activities that greatly contribute to the core competencies that make Chevron incompatible than the competitors. All the employees in Chevron are well trained and experienced to take on the jobs especially in the rig. Every person who landed on the island near the rig is to be inspected and each piece of the equipment has to be sprayed and string wrapped to avoid contact of germs and insect. Chevron also emphasized the importance of being discipline as it will eventually help the company to create high margin. Employees need to have the discipline to know where to place the well, follow the safety instructions, the cost of execution associated to do projects and ultimately recover out of the well. Chevron had spent over 20 years expanding systems that support a culture of safety and environmental management that aim to achieve incomparable performance and prevent any foreseeable …show more content…
With the application of the porter five forces, Chevron is able to define its competitive advantages between direct competitors. The threat of new entrants is fairly low as it requires huge capital, compliance to government legal laws and policy such as the import and export duties and regulations and custom laws and the product differentiation. The laws protect Chevron from any possible infringements and violation of intellectual property rights. However, companies must understand that any drastic legal changes might affect the business. With the high demand of energy require by the world, the customers have high bargaining power and are expecting higher quality or more services from Chevron. Chevron has been implementing and working on the cost-effective ways by taking into consideration of the economic factors especially on the exchange rates globally to supply the goods and services to these customers. As the demand go higher, Chevron has to look into the demographic segment and decide if increasing of employees is needed and create training and development opportunities to all the employees when necessary. The bargaining power of suppliers can be threaten to any companies. However, Chevron is not heavily affected. Chevron has created a supplier diversity program for the suppliers and its company to work together in developing innovative, cost-savings solutions that