Slack & Lewis (2008, p.45) providing the definition to “order winning and qualifying factors” indicate the first ones as “things that directly and significantly contribute” to success of the business, where the latter, qualifying factors are being considered as an average level of competitive performance to be accepted by customers.
Porter (1985 cited in Williamson et al., 2004, p.88) analysing the “order winning factors” of organizations has indicated, “product differentiation” and “cost leadership” as two main elements of success. Author (Porter, 1985 cited in Williamson et al., 2004, p.91) indicates the incompatibility between two elements as an organization gaining competitiveness based on the price should be committed to low cost resources, where differentiator, will be able to gain profit based on higher than average price, due to the higher costs of the resources and value being delivered by applied factor. The abovementioned elements are key factors for an organization to build up relevant strategy and Williamson et al., (2004, p.101) highlight the importance of internal strength and weaknesses, as well as external threat and opportunities to be taken into consideration when adopting strategy aimed for competitive advantage.
bp Exploration (Caspian Sea) ltd., has been operating under the corporate goal to meet the global energy demand through adoption of recent technology achievements and engineering applications to establish responsible, sustainable and diverse use of energy sources (BP, 2010). Key success factor achieved by the company has been development of its local resource base and market position as a supplier of high quality crude blend known as Azeri light.
Oil is a commodity being sold in the stock markets, due to the demand for energy source worldwide there is constant requirement for the crude with fluctuating price. There demand for the energy sources is increasing due to the development of national economics, being utilised in number of industries, including chemicals, perfume, power generation, etc. bp Exploration (Caspian Sea) ltd has been able to provide stable supply of crude to meet customer demand mainly in European markets and has identified its market position.
Strong and developed resource availability has been backing up the market position of the company (Williamson et al., 2004, p.101). The existing organizational structure, application of the modern techniques in exploration and production operations as well as the wealth of knowledge and skills developed by managers and technical staff have guaranteed lower production/uplift costs for the crude, hence providing the higher profit margins for the company. Besides the abovementioned factors, the upgrade of company procedures, improvement supply chain management and visibility of material movement and tracking have contributed to cost leadership move of the company, which provides competitive advantage.
As has been highlighted by Daft (1983 cited in Kandemir et al., 2006,p.300) company owned assets, capabilities, knowledge, information enable it to develop appropriate strategy in the region and achieve efficient operations and financial outcome. And today bp Exploration (Caspian Sea) ltd is one of the valuable assets of bp global, providing the higher profit margins to group and contributing to competitive advantage of it.