BP Solar

BP has responded through its sharp film photovoltaic cells designed to reduce manufacturing costs towards a direct at which solar energy lead become economically agonistical compared with other energy sources. As BPs Energy Commission chairman state Our goal is to eliminate the Catch 22 faced by producers of renewable technologieswithout the tell of volume sales, there is little incentive for a company to advance the investments that could bring down costs and make these products commercially viable on a large scale (Chambers, 1998, p. ).BP solar has invested some $200 million in solar power between 1996 and 2002, which has fostered it build an 18 percentage market share. It has launched a large advertising campaign in the US where it puts renewable energy at the fore of its offering. However, this was heavily criticised by consequence Magazine (2002) bearing in mind its renewable energy argument was worth just $1 billion compared to BPs total value of ? one hundred fift een% billion (Murphy, 2002).Like Shell Renewables, BP Solar does not state how it will innovate to achieve its goals. However, unlike Shell Renewables strategy of joint ventures and acquisitions, BP Solar implements its strategy simply through large investments into its own manufacturing processes. According to ostiarius (1985) The essence of formulating competitive strategy is relating a company to its environment (p. 3) in relation to the industry or industries in which it competes.This leads companies to choose one of trey generic strategies low cost, differentiation or focus which will help them to form competitive, profitable positions within the industry. To understand the low-cost strategies that both SBUs adopted, a formal PEST and five forces analysis of the SBUs (see Appendices III and IV), the key drivers for variety and critical success factors (CSFs) for the industry (Appendix V) are outlined. The major trends in the global and alternative energy industries are br iefly explained.