SWOT Analysis of ExxonMobil
This SWOT analysis examines the strengths, weaknesses, opportunities and threats facing ExxonMobil, one of the world's largest oil and energy companies with operations in countries all over the world, including developed and developing economies. Like its competition, ExxonMobil has many factors to consider as it shapes or changes its short-term and long-term strategy, including a strong emphasis on environmental concerns. Changing energy needs and greater corporate social responsibility must also be addressed if ExxonMobil wants to create a sustainable business model and maintain its brand equity among the growing competition in its industry.
- ExxonMobil has strong brand reputation as a leader in its industry for over one hundred years, creating credibility, sense of security, and trust among its customer base.
- The company has diversified its portfolio, entering new segments of the energy industry while further developing other strong brand names among its portfolio. This diversification strategy has served the company well.
- ExxonMobil has created and managed an effective corporate social responsibility programme and crisis management framework, which has helped to reduce its previous reputation for oil spills and other safety hazards as well as improved how it communicates on its actions, decisions, and any missteps that have arisen in recent years. This is a significant improvement from the days of the Exxon Valdez oil spill where the company mishandled the situation and did not communicate effectively.
- The company is now known for its innovative strategies and segment development as it has a strong R&D organisation that is focused on addressing industry needs and stakeholder expectations.
- It is a global leader in its industry with a strong presence around the world, including many emerging markets like the Middle East, India, and China where it is working with these countries to further develop their infrastructures, meet their energy needs, and help grow their local economies through education, job creation, and local philanthropic efforts.
- ExxonMobil is still viewed as not doing enough for the environment. Stakeholders are still accusing the company of pollution and overuse of natural resources as well as carbon emissions that are still too high to meet the climate change targets.
- The company's ongoing profitability in the wake of rising petrol prices has positioned it in the minds of some stakeholders, including petrol customers, as a greedy corporate giant. The idea that the company continues to become rich and make such a significant profit does not bode well with its customer base.
- Environmental interest groups still do not believe that ExxonMobil communicates with them and is transparent enough on their policy to be a greener company.
- The company has not developed alternative energy products to the extent that it could and continues to rely on oil as its main business segment, which is not a sustainable strategy.
- There is a significant opportunity to meet increasing demands for energy in many developing economies including those in the Middle East, Asia, South Asia and South East Asia.
- There is an opportunity to gain a leadership position in alternative energy markets if the company can develop the solutions faster than the competition can, helping to add brand equity to the ExxonMobil name.
- The company has a real opportunity to improve its image through more effort in all the countries where it does business with more community involvement and other social responsibility initiatives.
- Exxon has other brands that it can create more strategies for in terms of brand extension products to further diversify its portfolio, thereby reducing its reliance on oil and fossil fuels.
- Economic recessions even in the developing countries of China and India have slowed energy demand while these countries also must now look at alternative energy sources due to the pressure by environmental groups and global organisations that are demanding lower carbon emissions. This puts pressure on the company's profitability and potentially raises their cost structure in terms of having to spend more to develop alternative energy sources at a faster rate.
- Competitors in the energy industry are developing alternative energy sources and offering more to meet stakeholder expectations than ExxonMobil, which also puts pressure on the company to change its strategy or not be able to sustain its current profitability.
- More stakeholder groups are demanding accountability on the part of energy companies like ExxonMobil, so they must become more transparent in terms of their operations and their level of social responsibility, showing how they put this before profitability.