Bus 652 ExxonMobil Crisis Management Plan

ExxonMobil Crisis Management Plan

ExxonMobil is a multinational company based in the Irving, Texas, United States. It deals majorly with oil and gas. The company was formed in 1999 when Exxon Standard Oil of New Jersey and Mobil Standard Oil of New York. The Company affiliate is Imperial Oil, which is based in China. ExxonMobil has divisions that operate in various parts of the globe in an organized manner. The divisions fall into three classes, the upstream, downstream and the chemical division. The upstream and the chemical divisions are based in Houston, Texas. The downstream division is based in Fairfax, Virginia. The upstream division deals with wholesale, shipping, extraction and exploration of oil. The downstream division deals with retail sales, refining and marketing of products.

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ExxonMobil has three brands under which its products are marketed in the world. The brands are Exxon, Mobil, and Esso. Mobil is a gasoline company that is based in California, Florida, and New York. The company deals with retail sales. Exxon is the brand used in the rest of United States as the primary brand. Esso is the gasoline brand of the company worldwide. Seventy percent of ExxonMobil’s revenue is derived from the cash flow of the company, which is dominated by upstream division. The ExxonMobil report of Corporate Citizen indicates that ExxonMobil had 82000 employees by 2006. Four thousand employees are based in the downstream headquarters and 27000 employees in the Houston headquarters.

ExxonMobil is ranked fifth in terms of the size of revenue. The company is also ranked second among the companies that are publicly traded by the market capitalization. In 2014, ExxonMobil was ranked sixth in the Forbes Global list in 2000. The company has 37 oil refineries from the 21 countries in which it operates. ExxonMobil is the best oil refiner in the world. The company produces 3.921 million BOE daily making it the largest producer in the world. In the world, the company is ranked 14^th in terms of oil and gas reserves.

Justlike any other oil company, ExxonMobilf faces serious oil-related challenges. Such crisis may be external or internal. It is easy to deal with theinternal crisis. However, theexternal crisis is difficult to deal with because the company cannot change the situation facing them to their benefit. Instead, it can only devise means of adapting to the situation. The following paper will focus on the crisis that ExxonMobil is likely to face both internally and externally. The paper outlines critical steps that can be taken with each of the crisis. Any company must be well prepared and ready for any crisis through the formulation of succinct disaster mitigation and management strategies. A crisis management plan for six possible crises that the ExxonMobil can face has been outlined below.

• Economic: Slump in oil prices

Exxon Mobil could be faced with a financial crisis that may because of aslump in the oil crisis. A company does not have any other option but to comply with the trends in the global economy when the global prices of oil decrease. A decrease in oil prices would mean that the company would have to reduce its oil prices as well. The crisis occurs when the company has to cater for its cost of production, which remains the same even with the reduced returns. It follows that, the company will make fewer profits, but it will have to maintain the wages of its employees. The company may find itself spending more than it has to spend.  Several steps that the management can undertake to manage and escape an economic blow that can be caused by a reduction in oil prices.

Key Contact Personnel:Rex Wayne Tillerson, CEO/ Andrew Swiger, Principal Financial Officer

Contacts:

Tel: 972-444-1000

Address: 5959 Las Colinas Boulevard Irving, TX USA 75039

Critical steps

• First, Exxon Mobil should hold a meeting with the relevant stakeholders to announce the decrease in the oil prices. These stakeholders include the suppliers, the buyers, and the governmental representatives. This is important to ensure that the administration of the business can be smooth and without any friction. The meeting is supposed to inform all the executives and employees what the crisis meant to the company and the possible changes that the crisis will make in the company. The meeting also opens the crisis for investors and other individuals who feel they have a solution to the crisis to come out and help.
• After a general meeting to make everybody know of the crisis, the financial committee should identify the first step in managing the risk. The meeting by financiers and executives in charge of finance led by the CEO and chief financier is supposed to come up an immediate step in response to the crisis. Some of the steps will include setting up a hedging plan to secure prices in future. The other step could be creating a fund that can be used as an emergency kitty in case of future

When the finance committee has come up with an immediate step to be taken to address the crisis, the decision that has been made is supposed to be conveyed to everyone who is affected by the decision.This wi……………………….

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