Research Paper Harvard Case Solution & Analysis

Research Paper Case Solution

Advantages of Chevron Corporation

Depending on the country, the company tends to market its premium lubricants under 3 world class master brands namely Caltex, Texaco and Chevron. Within each of the discussed brand are trusted products which include Ursa, Havoline and Delo which equally shares the premium base oils customers’trust and are also well known.

Target Market

The company should use psycho graphic and geographic segmentation strategies for its product port folio means for business to business (B2B) segments, also the company should use demographics for its retail products segment in addition to other segmentation strategies. Also, the company should use differentiating targeting strategies for its services and products.

Direction and Image

The company should be placed at the busiest street intersection in Tokyo, Japan namely Shibuya Crossing, since the surroundinga reasa real ways packed with students, shoppers, young couples as well as commuters, the company would gain competitive advantage in catering large customer base. Due to the heavy traffic, the company would most likely develop the energy that would improve the lives and also empower the world to go forward and innovate more.

Image 01 shows Shibuya Crossing: busiest street intersection


The brand strategy of the company would be to integrate Corporate Social Responsibility in its brand strategy to improve the society through its business activities as well as contributing on the community development.(Bakker, 2019).


The marketing objectives of the company would be to gain the market share from the market rivals by 10% without altering the price ranges of the company’s premium brands. Additionally, the company would increase awarenessamongst the customers about Superior Petro Group via holistic media campaigns. Additionally, the company would instigate the usage of the product or services in the rural markets for the agricultural machinery.


The competitiveness of the energy sector and the oil and gas industry in the upstream sector of the industry is highly or significantly intense or fierce. The market competitors such as Royal Dutch Shell has generated $385.6 billion revenues for the year, 2015 whereas Exxon Mobil has generated $364.5 billion revenues for the year 2015, totally it has generated $194.2 billion revenues for the year 2015.

In addition to this, the best indicator for observing the size of the company refers to the market capitalization. The market value of the Exxon Mobil, US is 356.5, Petro China 329.7, Chevron, US 197.4, Royal Dutch Shell 192.1, Total France 118.5 etc. (Pitatzis, 2016).

Pricing & Making the Sale

Initially, the company would adopt penetration pricing strategy in which the company would most likely set low prices of product or services in order to reach the wide fraction of the market. Later on, the company would adopt competitive pricing after having a closer look on the market dynamics and key trends in oil and gas industry. In addition to this, the company has pursued with sales activities which need to be supported by understanding to build the better customer businesses.(Dean, 2015).

Ownership Roles / Responsibilities

The roles and responsibilities of the owner at Superior Petro Group should promote the strong governance practices in the organization as a whole. The boards of directors would be responsible to direct the affairs of the corporation and also they should be committed to sound principles of the corporate governance. Theexecutives would most likely be expected to achieve the targeted goals within five years of assuming their position in the organization.

Management Roles / Responsibilities

The roles and responsibilities of the management is evident in any oil and gas company in to days’ world. The information risk management would be responsible to make sure that each and every security aspect in the contract are adhere,which can be done by reviewing the relevant documents form the contracting organizations such as competition law, software licensing, export controls, privacy and confidentiality. Also, the technical data management would be responsible to manage the essential scientific and technical information and data used in Superior Petro Group. Their roles include organization, collaboration, scoping and knowledge sharing.

Supervisors / Leads Roles / Responsibilities

The roles and responsibilities of the supervisors would be to set goals and objectives for the deadlines and performance that would most likely comply with the plan and vision of the company in both short term and long term. Not only this, they would organize the workflow as well as ensure that the employees understand their delegated tasks and duties. In addition to this, the supervisors would monitor the productivity of the employees, hence provides coaching and constructive feedback.

Production Operator Roles and Responsibilities

Production operators would be engaged in each and every stage of the Superior Petro Group’s production. They would be central to the production of the business. They would ensure to support the new projects and they will also file development planning for the purpose of making sure of optimal and safe operability of the future facilities.

Office / Support Staff Roles / Responsibilities

Superior Petro Group’s operations and maintenance employees would be working in the stimulating environment that would reward teamwork, value diversity, and encourage the career development as well as continuous learning.  They would possess many roles such as:

  • They would demonstrate innovation, creativity and initiative.
  • They would exhibit concise and clear written as well as oral skills to convey present position, facts and interpret policies.
  • They would manage multiple responsibilities and tasks simultaneously, process work accurately and in a timely manner.
  • They would also assess situation accurately, identify key problems as well as develop the workable situations.

Income statement

Its total income is increasing with increasing trend, which shows a positive profit for the company in upcoming years. The exhibits can be seen in Appendix A.

Balance sheet

Its total equity is increasing with increasing trend, which also increases the total liabilities for the company. That is why its debt to equity ratio will not change in the future. The exhibits can be seen in Appendix B.

Cash flows statement

Cash flows from operations are gradually increasing in upcoming years which is the positive sign for the company that will be ultimately beneficial for the future expansions in related and diversified areas for the company. The exhibits can be seen in Appendix C.


The location of the Superior Petro Group would be in the busiestinter section in Tokyo,Japan, which would allow the company to provide its product or services to large customer base, thus increasing profit returns and maximizing the market share.

Supply and Inventory Management

The supply chain management of the company should create opportunities and promote high standards of social, safety and environmental performance. Additionally, the company’s approach should be to maintain the supply chain that should focus on two critical elements such as; the company should create prosperity through inclusive and local economic opportunity. The company’s supply chain management should have various objectives such as; standardizing practices as well as technologies, putting demand driven practice center and front of operations and generating stable cash flows.

In addition, the inventory management system i.e. Inventory managed order network would allow the company to proactively keep vital inventory on their customer shelves. Also, through automated replenishment system, customer would no longer need placing orders, thus running of the inventory as well as building safety cushions. The model would provide various benefits to the company such as; it would omit the expensive excess inventory, that stipulate the increase in the working capital, ensure the product is on site at the time of need, quicker response times to varying conditions, reducing cost of transaction (data entry and invoices), omittingerective order patterns and streamlining reconciliation processes and financial statements.

Production and Distribution

The marketing logistics team at Superior Petro Group should make a commitment to build the best fuel distribution system. Also, the company should develop the most effective as well as efficient distribution operation in the petroleum industry by using the best in class processes.


To sum up, the Superior Petro Group would be highly profitable and feasible, the location of the Superior Petro Group would be in the busiest intersection in Tokyo, Japan, and the company would make a commitment to build the best fuel distribution system.The inventory management system i.e. inventory managed order network would allow the company to proactively keep vital inventory on their customer shelves. It is to conclude that the project would be feasible or viable for competing with competitors, thus generating increased profit margin.

Appendix A

2017 2018 2019 2020 2021
 Sales and other revenue    206,757,630    210,892,783    215,110,638    219,412,851    223,801,108
 Sales tax    (37,909,193)    (38,667,377)    (39,440,724)    (40,229,539)    (41,034,130)
 Net revenue    168,848,737    172,225,712    175,670,226    179,183,630    182,767,303
 Cogs    153,972,023    157,051,463    160,192,493    163,396,343    166,664,269
 Gross profit      14,876,414      15,173,942      15,477,421      15,786,970      16,102,709
 Distribution and marketing Expense        6,018,105        6,138,467        6,261,236        6,386,461        6,514,190
 Administration expense        4,146,166        4,229,089        4,313,671        4,399,945        4,487,943
 other expense        1,411,469        1,439,698        1,468,492        1,497,862        1,527,819
 other Income            419,559            427,950            436,509            445,239            454,144
 Operating profit        3,720,233        3,794,638        3,870,530        3,947,941        4,026,900
 Finance Cost          (235,049)          (239,750)          (244,545)          (249,436)          (254,425)
       3,485,184        3,554,888        3,625,985        3,698,505        3,772,475
 Share of profit of associate            837,776            854,532            871,622            889,055            906,836
 Profit before taxation        4,322,960        4,409,419        4,497,608        4,587,560        4,679,311
 taxation        1,140,258        1,163,063        1,186,324        1,210,051        1,234,252
 Taxation Profit for the year        3,182,702        3,246,356        3,311,283        3,377,509        3,445,059

Appendix B






 Non-Current assets
 PP&E    10,000,115    10,200,117    10,404,120    10,612,202    10,824,446
 Intangible Asset  -  -  -  -  -
 Long term investment      4,051,815      4,132,851      4,215,508      4,299,818      4,385,815
 Long term loan            17,820            18,176            18,540            18,911            19,289
 long term deposit and prepayment          289,045          294,826          300,722          306,737          312,872
 Defered tax      1,214,351      1,238,638      1,263,411      1,288,679      1,314,453
 Total Non-Current assets    15,573,146    15,884,609    16,202,301    16,526,347    16,856,874
 Current Assets
 Stock in Trade      9,500,585      9,690,597      9,884,409    10,082,097    10,283,739
 Trade debts      3,101,181      3,163,205      3,226,469      3,290,998      3,356,818
 Loans and advances            48,403            49,371            50,358            51,366            52,393
 Short term prepayments          304,673          310,766          316,982          323,321          329,788
 other receivables      7,773,261      7,928,726      8,087,301      8,249,047      8,414,028
 Cash and bank balances      2,591,864      2,643,701      2,696,575      2,750,507      2,805,517
 Total Current Assets    23,319,967    23,786,366    24,262,094    24,747,336    25,242,282
 Total Assets    38,893,113    39,670,975    40,464,395    41,273,683    42,099,156
 Equity and Liabilities Equity
 Share capital      1,070,125      1,091,528      1,113,358      1,135,625      1,158,338
 Share premium      1,503,803      1,533,879      1,564,557      1,595,848      1,627,765
 General reserves          207,202          211,346          215,573          219,884          224,282
 Unappropriated profit      7,738,731      7,893,506      8,051,376      8,212,403      8,376,651
 Remeasurement of post-employment benefit       (321,601)       (328,033)       (334,594)       (341,286)       (348,111)
 Total Equity    10,198,061    10,402,022    10,610,063    10,822,264    11,038,709
 Liabilities and Non-Current equity
 Asset retirement obligation            93,809            95,685            97,599            99,551          101,542
 Current Liability
 Trade and other payable    27,154,452    27,697,541    28,251,492    28,816,522    29,392,852
 Accrued markup                  431                  440                  448                  457                  467
 short term borrowing          395,000          402,900          410,958          419,177          427,561
 taxations      1,051,361      1,072,388      1,093,836      1,115,713      1,138,027
   28,695,053    29,268,954    29,854,333    30,451,420    31,060,448
 Total Liability and Equity    38,893,113    39,670,975    40,464,395    41,273,683    42,099,156

Appendix C






 Cash flow from Operating 
 Cash generated from operation     1,991,410     2,031,238     2,071,863     2,113,300     2,155,566
 finance cost paid         (52,396)         (53,444)         (54,513)         (55,603)         (56,715)
 Income tax paid       (359,956)       (367,155)       (374,498)       (381,988)       (389,628)
 Long term loan and advances         (14,725)         (15,020)         (15,320)         (15,626)         (15,939)
 long term deposit and prepayment       (128,728)       (131,303)       (133,929)       (136,607)       (139,339)
Interest received on short term deposit         115,419         117,727         120,082         122,484         124,933
 Net cash generated from operating     1,551,020     1,582,040     1,613,681     1,645,955     1,678,874
 Cash flow from Investing
 Fixed Capital Expenditure   (1,715,562)   (1,749,873)   (1,784,871)   (1,820,568)   (1,856,979)
 Proceed from disposal of operating assets              5,391              5,499              5,609              5,721              5,835
 Dividend received from associate         521,521         531,951         542,590         553,442         564,511
 Net cash generated from Investing activities   (1,188,650)   (1,212,423)   (1,236,671)   (1,261,405)   (1,286,633)
 Cash flow from financing activities
 Dividend paid   (4,153,911)   (4,236,989)   (4,321,729)   (4,408,164)   (4,496,327)
 Net Increase/Decrease in cash and cash equivalent   (3,791,541)   (3,867,372)   (3,944,719)   (4,023,614)   (4,104,086)
 cash and cash equivalent at beginning of year     5,988,405     6,108,173     6,230,337     6,354,943     6,482,042
 cash and cash equivalent at ending of year     2,196,864     2,240,801     2,285,617     2,331,330     2,377,956
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