Negative Externality: Pakistans Carbon Tax

Negative Externality Pakistans Carbon Tax set back of Contents (Jump to)Introduction purpose 1 re march 2Answer 3ConclusionReferencesIntroductionThe subsidization is based on the ideal of banish externalities. A detrimental outwardness norm on the wholey is a hail that is incurred to the third party as a result of an stinting trans doing. The assignment is based on the case study of Pakistans polity for follow throughing the vitamin C tax income. This way the administration of Pakistan has taken a positivistic tonicity towards trans follow out with the proscribe externality befoulment and special K ho do gas waiver. afterwards the assignment c everywheres the separate feels that must be considered by the Pakistan g everywherenment to deal with the problem ad reduce the seismic disturbance of controvert externalities.Answer 1Negative Externalities It fuck be defined as the picture of harvestings on consumers that has the prejudicious pertain on the thir d party. Negative externalities be mainly concerned with the environsal topics of producing and consuming a product (Laffont, 2008). The main sheaths of negative externalities ar fashion pollution, water pollution, noise pollution, systematic risk etceterateraA negative externality normally is a monetary value that is incurred to the third party as a result of an economic trans follow through. In this type of economic transaction, consumer and incurr be the first and uphold party, and the third party is comprised of institution, individual, resource or property owner that go away indirectly affected referable to that transaction (Caplan, 2008). The negative externality is overly known as external equal in economics.Some everyday negative externalities arThe smokers ignore the fact of the offensive electrical shock of the unresisting smoking for the non smokers around them.Air pollution ca mathematical functiond by the traffic partakes the lungs of the thron g who atomic design 18 non even travelling on the roadThe viands wastage(Source Buchanan, James, Externality. scotchal)Negative externalities normally occur in the situations where property ownership of the assets and resources be not properly allocated and atomic number 18 uncertain. For instance, in that location is no owner of the oceans or the forests, so eachbody breadbasket pollute them without any fear of generateting sued by the owner. External cost like the cost of pollution makes the marginal affable cost curve mush higher than the marginal private cost.(Source Economicsonline.co.uk) governing body Intervention to correct the negative ExternalitiesThe environmental concerns atomic number 18 the near serious contest in front of government now days. They are victorious up many steps to deal with the negative externalities and eradicate its harmful effects from the third party. The nigh common among them are theEnvironmental revenueThis is the about com mon line down of adjusting the negative externalities. This is to a fault referred to as the qualification of polluters day. This value step-ups the private revenueation of production or utilisation with the aim of lessen the overall demand for the product that is ca utilize the negative externality. For instance money collected from the congestion charge of a vehicle that is entering a busy road. The environmental impose revenuees include the landfill impose, the congestion charges, vehicle excise duty and plastic bag treasure.Problems with environmental taxes Pollution tax has the following related problemsAssignment of the right level of taxationConsumer upbeat effectsInvestment and profession consequences.Carbon TaxCarbon tax refers to the tax that is imposed on the burn downs nose candy content (Holler, 1991). All the hydro hundred fuel contains the ampere- guerilla content in it like petroleum, rude(a) gas and coal. They let out the nose candy diox ide in the atmosphere when they are burnt. Carbon taxes are pass water to reduce the green mob effects of gas liberation through cost telling heart (Gupta, 2007). . Carbon taxes are very regressive and carry on the lower income pigeonholing largely. The impact of coke taxes can be addressed using the tax revenue for the lower income groups. The features of atomic number 6 tax areThis is a direct tax on the content of cytosine in fossil fuel.It is considered as the just about economical and efficient compute for conveying the cost signals that are crucial for bring down the carbon contentIt can be structured for softening the impact of the spare cost by distri just whening to the homeholds.Carbon tax is supported by economists, public officials, environmental touchers and citizens.The carbon tax policies of government are evidential for winning the global effort to fight the climatical diversifys. Pricing carbon is a domineering step towards it.The governme nt may interfere through the use of laws and regulations. For example, theHealth and Safety at Work Actcovers all public and private sphere artes. Local Councils can take action against noisy, unruly neighbors and can progress by-laws preventing the public consumption of alcohol.Answer 2Case Study Over dependPakistan has latterly considered taxing the carbon emanation from the big fossil fuel assiduity and reduces its negative impact on the existences climate. This was declared in the national climate turn scheme. They emphasize on the use of renewable resources. The government impart consider introducing carbon tax on the use of environmentally detrimental push generation from fossil fuels, state the plan, launched at an event in Islamabad. (Reuters Point Carbon)The Pakistan government in their indemnity in constellation the tax on carbon at the rate of Pakistani rupee 25 per ton. It started from 1 July 2012 with the objective of ever-changing the form _or_ system of government later on to securities persistence based electric arc trading scheme (Gillard, 2010). Pakistani economy suffered slow-down due to the climatic departs. Climate transmute refers to situation that reflects the material dislodges in the patters on weather conditions over the special(a) era period. Climate tacks are ca utilize by various factors such as solar radiation variations, biotic turn and volcanic eruptions. The human activities are likewise responsible for the severe climatic kinds that hold back introduce to global warming (Edward Miller, 2001). These severe climatic changes take the adverse impact on the overall cycle of earths process. Evidence for recording the climate changes has been taken from various resources that were utilise to reforge the past climates. The changes welcome affected the entire world and Pakistan has faced the noteworthy economic impacts due to this. It has affected the infrastructure, coastal communities, and marke t-gardening and water protective covering in Pakistan.Carbon taxes are in-chief(postnominal) for reducing the negative effects of carbon electric arc. Carbon taxes are formed to reduce the green sign of the zodiac effects of gas emission through cost effective means . Carbon taxes are very regressive and impact the lower income group largely. The impact of carbon taxes can be addressed using the tax revenue for the lower income groups. These taxes bring home the bacon the inducings for the substantials that adopt the environment friendly approach for production process. These are withal alpha for raising the money infallible for taking the initiatives to save environment. The impacts of carbon tax on the economy of Pakistan are as followsMacro economics effects Pakistan economy promotes the reduction in usage of carbon related verve resources for the industry purpose and geological fault towards the renewable energy resources. Carbon tax is the cost to the producers that use the carbon efficient energy resources. So in rove to reduce the cost and affix the profit, it is important for them to shift towards the other renewable resources of energy. Carbon tax is important for reducing the tax as well as the negative impacts on the environment.(Source Self Study)The left graphs clearly states that the tax leave behind increase the cost of production and decrease the quantity of fuel energy. The go away also lead to higher labour cost and also it pull up stakes lead to increase in fuel prices. The right graph on the opponent shows the benefit of using the renewable resource of energy and increase in production level. So it is seen that carbon tax exit impact the strain negatively, but at the same sequence encourage them to use the renewable resources of energy that pass on have the desire term plus impact on environment and business.Effects on employment The carbon tax has the direct negative impact on the employment because it will lead to additional burden on the production cost. The trade sector will see the shift towards the non trading sector due to this.Effects on erectholds The household will experience the change in cost of the command commodities as the industries will include the cost of carbon tax in total cost of production. This will lead to negative impact and the household income will be decreased.Direct ActionThe government replaces the carbon tax with the direct action plan. The direct action plan includes the incentive curriculum for the industries that reduce the carbon emission rate significantly (Preston, 2006). The key points of the policy areTarget of 55 reduction in carbon emission rateScrapping the carbon tax and associated taxesCreation of green army for conducting the environment conservation work.The government released the white paper that has the details about the policy and the working of fund for emission reduction. The labor as well as the coalition supported this policy over the ca rbon tax. Contrary to the carbon taxes the policy emphasizes on gaining the incentives by reducing the carbon emission in environment. Policy also has the provision for compensation payment to tax payers for reducing the increase in prices. It directs the business to work towards the emission reducing projects.Pakistan is the largest subscriber towards the green house gas emissions, so this policy will assist the entire worlds by reducing the carbon emission without imposing any impact on the cost of production. The main feature of the direct action policy is creation of emission reduction fund, which will be $3 billion for four social classs. The fund will ask the industries to fill the tenders for the emission reduction projects. This will initiate the reverse auction and the industries will contest for reducing the emission rate to win the incentive from the government. The auctions will be held quarterly.The government is sure about the positive outcomes of the policy in ba sis of reduction in carbon emission.(Source Self Study)The direct policy has the positive impact on the Pakistan economy. Pakistan actually has the capableness of achieving to a heavy(p)er extent than the 5% target. Pakistan will get to the emission reduction project by 2020 in much efficient way. It will domiciliate towards the global action for addressing the climate change. By reducing the emission amount the economic kick upstairsth of the Pakistan is expected to be doubled in next few years. It will directly impact the long term projection of the economic growth. Since it has no cost connect to it, it will be beneficial for the business as well as the house hold income. Instead the policy rules of taking the advantage of incentive will direct the business house to reduce the carbon emission without any impact on the cost of production. It is estimated that Pakistan economy will grow by 17% with this project.(SourceClimate transpose Authority, 2013)The level of the pric e link up to carbon with incentive plan will reduce the economic cost. at that place will be no cost passed to the customers in the form of true(p)s and services. It will also mold the direct income transfer from Pakistan for buying the additional emission from the overseas. This will also reduce the indirect cost. This will have the positive trade effect.Carbon Tax Vs Direct ActionCarbon tax policy as well as the direct action policy aims towards the reduction of the carbon emission in the environment. The base is same but the approach is totally contradictory. The direct action is better than the carbon tax policy because of the below mentioned factsCarbon tax has the cost attached to it which will in return increase the cost of production whereas the direct action has the incentive policy which encourages the industries to reduce the amount of carbon emission without any effect.Carbon tax will lead to reduction in employment opportunity due to increased labor cost whereas thi s will not occur in the case of direct action policy.The direct action policy has the better targets and objectives as compared to carbon taxing.The carbon tax will reduce the household income due to the increased prices of commodity whereas the direct action plan will not have the negative impact on the household income.Carbon taxing policy will lead to increase in fuel prices and the actual efficiency will be reduced whereas the direct action plan will increase the efficiency of the industry and the quality of production.The direct action policy has the clear targets in equipment casualty of reduction of carbon emission whereas it is missing in the carbon tax policy.For dealing with the negative externalities, the Government of Pakistan has taken a positive step in the form of Carbon tax. This will reduce the green house gas emission and promote the use of renewable resources. This was not whole Pakistan but the climate of entire world will get the positive results. Pakistan is taking the considerable steps to reduce the carbon emission in the environment. This is because of the fact that the economy of Pakistan has suffered due to the large amount of green house gas emission. The government introduced the carbon tax and direct action policy for the reduction of carbon emission. The carbon tax policy does not get the enough success and the direct action plan replaced it successfully. By the year 2020 Pakistan is aiming at significant maneuver over the carbon emission in the environment.Answer 3The carbon tax is very unique in nature but it is quite effective for reducing the impact of negative externalities. The main purpose of carbon tax is to reduce the carbon dioxide emission and with this save the severe climatic changes. nonetheless this is noted that only the carbon tax cannot save the climatic change and reduce the impact of negative externalities. The Pakistan government should also make other policies to reduce the impact of carbon emission in t he environment. For this purpose they must make the policies and regulation of reducing the coal usage in industry as it causes lots of pollution and also it is a non renewable resource of energy. The government should compulsorily regulate the use of renewable resources of energy that are natural and reduces the emission of green house gases.Carbon tax policy is quite cost effective for the Pakistan economy and it is quite easy to switch from the pollution taxes to direct subsidies and promotes the pristine and greener production technologies. however the impact of these taxes totally depends on how this money is being used for the reducing the impact of negative externalities (Scott, 2005). They must be equilibrise by decreasing the amount of other taxes by the method of revenue recycling. The green taxes can actually help the overall economy of Pakistan provided it is used in the right direction and the taxes are imposed religiously to achieve the main objective behind them. In the nutshell, it can be said that imposing the carbon tax is a very progressive step of the Pakistan government. However along with this they should also consider the following for dealing with the negative externalities (Bonnieux, 2002)Preserving the tropical rain forests in PakistanLimiting the public access to the get up land for their recreational purposesPreservation of wet land succeeding(a) the tralatitious shipway of farm buildingImplementing the price-based instruments alter the prices of profounds and services to reflect their carnal knowledge impact.Providing the grants to farmers under the Control of Farmyard Pollution SchemeConclusionTo conclude, negative externality is a type of economic transaction, consumer and producer are the first and second party, and the third party is comprised of organization, individual, resource or property owner that get indirectly affected due to that transaction. Pakistan Government has decided to impose the carbon tax for dealing with the situation of uttermost(prenominal) pollution and green house gas emission through their fossil fuel industry. The level of the price attached to carbon with incentive plan will reduce the economic cost. on that point will be no cost passed to the customers in the form of goods and services. It will also regulate the direct income transfer from Pakistan for buying the additional emission from the overseas. Main purpose of carbon tax is to reduce the carbon dioxide emission and with this save the severe climatic changes. However this is noted that only the carbon tax cannot save the climatic change and reduce the impact of negative externalities. The Pakistan government should also make other policies to reduce the impact of carbon emission in the environment.ReferencesBonnieux, F. and Rainelli, P.( 2002). Economics and the interface between agri civilisation and nature, in Brouwer, F. and Van der Straaten, J. eds, Nature and Agriculture in the European Union, Cheltenham, Edward Elgar humanities 338.1094 P2.Caplan, Bryan(2008).Externalities. InDavid R. Henderson(ed.).Concise Encyclopedia of Economics(second ed.). IndianapolisLibrary of Economics and Liberty.ISBN978-0865976658.OCLC237794267.Edwards, Paul Geoffrey Miller, Clark A. (2001).Changing the atmosphere just knowledge and environmental governance. Cambridge, Mass MIT Press.ISBN0-262-63219-5.Gupta, S.et al. (2007).13.2.1.2 Taxes and charges.Policies, instruments, and co-operative arrangements. Climate Change 2007 Mitigation. Contribution of functional Group III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change (B. Metzet al. Eds.). Print version Cambridge University Press, Cambridge, U.K., and bracing York, N.Y., U.S.A.. This version IPCC website. Retrieved 2010-03-18.Hoeller, P. and M. Wallin (1991).OECD Economic Studies No. 17, Autumn 1991. Energy Prices, Taxes and Carbon Dioxide Emissions(PDF). OECD website. p.92. Retrieved 2010-04-23.J.J. Laffont(2008). ext ernalities,The New Palgrave Dictionary of Economics, 2nd Ed.Abstract.McKibben, Bill (2011). The Global Warming Reader. New York, N.Y.OR Books.ISBN978-1-935928-36-2.Preston, B.L. Jones, R.N. ( 2006).Climate Change Impacts on Australia and the Benefits of Early Action to Reduce Global Greenhouse Gas Emissions.Scott, S., (2005),Fertiliser Taxes effectuation Issues, Final Report, Wexford, Environmental Protection Agency.Williams, C. (1997) Environmental victims Arguing the costs,Environmental Values, 63-30. foundation and Managing Change ExxonMobil renewing and Managing Change ExxonMobilInnovation and change are the most important concepts discuss in new-fangled dynamic business environment. The maturation of engine room and the increasing burning look ats of the people have created a dynamic environment of which the corporations may not be able to get through unless they simultaneously change their strategies with those global environmental and scientific changes.This report in tends to provide a detailed discussion of the focal point of change within Exxon Mobil mass (EMC) which is one of the worlds largest publicly traded international crude oil and gas company, providing energy that helps fend for growth economies and improve living standards around the world.My discussion mainly covers cardinal perspectives. First, I explain the factors influencing the EMCs innovation and change strategy and then, I evaluate the importance of change to EMC and the potential problems they face when EMC implementing the change. Finally, I evaluate the strong suit of EMCs strategy for managing change within the organization.OVERVIEW OF THE COMPANYExxon Mobil is the worlds largest publicly traded international oil and gas company. They hold an industry-leading schedule of global oil and gas resources. They are the worlds largest refiner and marketer of petroleum products. And their chemical company ranks among the worlds largest. However they are also a technology company, applying intuition and innovation to find better, safer and cleaner ways to deliver the energy the world privations.EMCs organizational structure is built on a concept of global businesses and is designed to allow Exxon Mobil to compete most effectively in the ever-changing and challenging worldwide energy industry.EMC operates facilities or markets products in most of the worlds countries and explore for oil and natural gas on six continents. Exxon Mobil uses innovation and technology to deliver energy to a growing world. They explore for, produce and sell crude oil, natural gas and petroleum products. They are committed to meeting the worlds growing demand for energy in an economically, environmentally and socially responsible manner. in that respectof innovation and change strategy of EMC would be the most significant factor for the future business expansion.FACTORS INFLUENCING blueprint AND flip-flopFactors influencing the innovation and change differ according to the business linguistic condition of the organization. For example if a particular company is engaged in energy industry they may passing concern about environmental factors whatever the change they imply. Because the environment has a major impact on all the product and services portfolio of EMC. consequently it is more important to record the stage setting of business of which a particular corporation is engaged in forrader moving into a changing situation. In addition ripe technological advances, cultural changes, structure of the corporation and regulatory requirements also can be identified as other factors to consider. However, at that place is also a need to understand the magnitude of challenge faced in trying to effect strategical change. To do this it is expedient to consider the type of change ask , the wider mount in which the change is to occur and the specific to change that exists Following main factors can be considered as the influencing factors of change.The contextThere is no one right formula for management of change. The success of any campaign at managing change will be dependent on the wider context in which that change is taking place. For an example managing in a small, perhaps relatively new business where a motivated team are themselves driving change, would be quite contrastive from trying to manage change in a major corporation, or perhaps a long established public sector organization, with establish use, formal structures and perhaps great deal of resistance to change. The contexts are completely different and the approach to managing change therefore needfully to be different.Balogan and Hope HaileyBalogan and Hope Hailey build on this point to highlight a number of important contextual features that need to be taken into account in designing change programs. charm above exhibit. It reflects few examples of contextual features and their influence on strategic change programs.The time available for change c ould be dramatically different. When consider EMC for example there may be new enactments from the governments for usage of energy resources and exploring energy resources. Or there may be a new ersatz for fuel such as water. Then EMC need to have a rapid change. So there is no more time to waste. However there may be corporate decision and management plans for change. The management of EMC may have targeted at a kind of a change with the future forces. That can be taken a along time arena to change.No matter how significant the change, it may be that there is a need for the preservation of certain aspects of the organization, in particular those that are to do with the competences which changes need to be based. For EMC it is necessary to concern the environmental factors whatever the change they expect to see. And also there may be most competent employees and professionals to be retained in the corporation.Change may be helped if there is a diversity of experience, views and op inions within an organization. EMC has expanded their operations in six continents. So the diversity is higher than any other organization. Therefore EMC has to consider different of necessity of the diversified stakeholders in all over the world.The previous experience of change is also important. Therefore capability also plays an important role in change management process. EMC has demonstrated their capability in managing change with the current successful business portfolio.Capacity of the organization is also important to survive with the available resources. If a corporation has problems of miss of required resources the change will cause for a business failure. EMC has able resources in all over the world. The current stage of the business spiritedness cycle in EMC has paved the way for this.The readiness of EMC is good. The management has mute the need for change. They have established them into their budgets. EMC has announced the expected change and the groundbreakin g expectation in there intelligence service article of A view to 2030.The power to change in EMC also is in a good position. The bill of director consists of 11 directors of which 10 of the 11 directors on board are independent. CEO has 4 vice electric chairs for the decision making. Therefore EMC should understand from where the resistance is effect i.e. from top level or lower level.EMC is currently engaged in various activities such as production, exploration, refining, fuel marketing, natural gas and power marketing etc. And also it is global firm operates in six contingents with billions of employees around the world. Therefore when concern the business context of EMC it is much complex in nature. In addition the industry also is highly volatile with the development of the technology would also be significant to EMC.CultureAs EMC operates in six continents this factor is highly an effect to the innovation and change strategy of EMC. EMC has to manage the stakeholders such a s customers, suppliers and employees etc. in different contexts. Therefore there is a significant impact on the innovation and management strategy in order to create proper change management process.The cultural web provides a good basis of understanding the effects of cultural changes to any organization. It is a theatrical of the taken for granted assumptions or paradigm of an organization and the physical manifestations of organizational culture. (See below exhibit.)Gerry Johnson Managing the strategic ChangeAbove all the factors are the parts of the organization culture. When consider the EMC the culture is the most significant factor as it operates in globally. Therefore it is necessary to consider the cultural changes and their effects to the modern business arena for EMC. The cultural web also can be used as a way of understanding current organizational culture and desired future culture for EMC.EnvironmentThe environment is the most significant factor influence to any corpor ation to their innovation and change strategy. The concepts such as environment protection, sustainable development etc. has created the concerns of various regulators to control the organizations. The nature of the business portfolio of EMC is highly linked with the environment. They explore in environment, excavation and extracting from environment and finally the consumption of energy also releases the polluted air to the environment. Therefore EMC has to be highly concern about the environmental factors when they influence their changing strategies.TechnologyThe technology is also a significant factor for the innovation and change strategy of EMC. The development of the modern technology has created a massive cost benefit opportunities to EMC. For example the mine machines can produce more efficiency than the laborers. In addition different technological developments have increasingly changed the investigate and development perspective of EMC.THE IMPORTANCE OF CHANGE TO EXXON MOBILIt is important to any organization to realize the need of change. The strategic change is considered at the initiation of the business portfolio and it should be evaluated by time to time ongoing basis. Change can be in any context. Therefore it is important to understand why EMC needs the change.By nature EMC engaged in energy industry. The crude oil prices and the regulatory requirements of government in different countries and the authorities may change time to time. Those external forces of change can not be predicted and also effect to whole organization. As EMC operates in diversified cultures around the world the effects of the stakeholders in different arenas are also may be demanded for change. then(prenominal) experiences of change management in EMC has proved that the growth of the company depends on how quickly the company finds the innovational products. The technological advancement in modern world has changed the way of inquiry and development. The technology has facilitated a lot for improving productivity in R D sections. Therefore EMC should be highly concern regarding the future advancements to the industry and there effect on EMC. There may be preference substitutes in future and also there may be newer technologies for exploration, mining and other activities in the industry. Therefore change is very important to EMC.PROBLEMS OF IMPLEMENTING THE CHANGEHowever, even though the change is the most important thing to EMC there are some(prenominal) potential problems they have to be faced when they implement the change.The complexity of the geographical field is the major problem. In here EMC has to chequer change strategy in order to line with the cultures, regulatory requirements and needs of the people in those countries. Some times there can be higher resistance from the above forces when we implement the change.Managing the risks from increases in global nursery gas emissions is an important concern for EMC, industry and gov ernments around the world.Kurt Levins forcefield analysis provides an sign view of change problem that need to be tackled, by let oning forces for and against change. It helps to identify the driving forces and restraining forces to a particular change situation.EFFECTIVENESS OF MANAGING THE CHANGE inwardly THE ORGANISATIONThe forcefulness of managing the change is depending on how management, employees and finally the organization as a whole face to the change event. In here it is most important to understand the styles and roles of change in a particular organization.Whoever is in the position of managing change needs to consider the style of management they adopt. gibe to the organizational context different styles are likely to be more or less appropriate. preparation and communicationThis involves the explanation of the reasons for and means of strategic change. It might be appropriate if there is a problem in managing change based on misinformation or lack of information and if there is adequate time to invest in persuading people and give them the take on to assimilate the information. However there are problems here. Assuming that reasoned disceptation will overcome perhaps years of embedded assumptions about what truly matters could be native specially if there is a lack of shared trust and respect of between management and employees. Relying on processes of communication in a top down fashion may also be problematic. Change is likely to be more effective if those affected it are involved in its development and planning.This is what EMC is doing. They give the opportunity to management and employees to contribute to the change event. EMC has long term focus on their change strategy. They have taken several measures to create educated environment within the organization. EMC has go on investing heavily in math and science education in the United States. They supported initiatives that encourage students to take an active interest in careers i n the math and science fields, encourage the professional development of highly qualified teachers and promote involvement of women and minorities in these subjects. Exxon Mobil has a long account of supporting and improving educational programs as an important business priority. There is a separate teachers academy for EMC to develop quality people. EMC communicates using news releases and gives the employees the opportunity to view them.CollaborationThis is the method of participating in the change process is the involvement of those who will be affected by strategic change in the change agenda. For example the identification of strategic issues, the strategic decision making process, the setting of priorities and the implementing the changing event is done by the lower level. In EMC those all the parties are the contributors of the change. Its like a routine aspect but finally top level management can achieve the expected change event. Therefore the collaboration has become a way of building readiness, and capability for change. EMC has effectively collaborated with the people in order to create current expanded business portfolio in all over the world.Intervention and DirectionIntervention is the coordination of and potence over processes of change by a change agent. Direction involves the use of personal managerial authority to establish a clear future strategy and how change will occur. It is essentially top down management of strategic change. It may be associated with a clear vision or strategic intent substantial by someone seen as a leader in the organization. EMC has the dictum of taking on the worlds toughest energy challenges. Therefore it can be still the direction of the management for the strategic change.CoercionIn its most extreme form, a directive style becomes coercion involving the imposition of change or the issuing of edicts about change. This is the explicit use of power and may be necessary if EMC is facing a crisis or a conflict of change.However it should be noted that the management change in EMC by using above techniques may be effected by the factors such as capability, time and scope of change, power structure of EMC, capacity to change etc.When it comes to consider strategic change, there is too often an overemphasis on individuals at the top of an organization. It is useful to think of change agency more broadly. Change agent is the individual or group that helps effect strategic change within an organization. When consider the top level management EMC has a number of change agent within the organization with massive experience.There are highly qualified CEO and four vise presidents for the decision making. Rex w. Tellerson lead and Chief Executive Officer a native of Wichita Falls, Texas, Mr. Tillerson earned a Bachelor of recognition in Civil Engineering at the University of Texas at Austin forrader joining Exxon Company, U.S.A. in 1975 as a outturn Engineer. Senior Vice chairman Mr. Mark Albert s born in Calgary, Alberta, Canada, and increase in Texas, Mr. Albers joined the company in 1979 and holds a bachelors degree in petroleum engineering from Texas AM University. Mr. Michel J Dolan Senior Vice professorship joined Mobil Oil Corporation in 1980 at the Paulsboro, New Jersey, and research laboratory. Over the next 13 years, he worked in a mutation of engineering and managerial positions supporting Mobils worldwide refineries. Andrew P. Swiger is senior vice president of Exxon Mobil Corporation and a member of the corporations Management Committee. Throughout his career, Mr. Swiger has held a mixing of technical and managerial positions in production, operations, engineering, planning and gas and power marketing. He joined the company in 1978 as an operations engineer in Morgan City, La., eventually progressing through a series of upstream staff and managerial assignments in Africa, Europe and North America. Donald D Humpheyars Senior Vice President and Treasurer a na tive of Tulsa, Oklahoma, Mr. Humphreys earned a Bachelor of Science in Industrial Engineering and Management from Oklahoma State University in 1971. He served in the U.S. Army from 1972-1974. He obtained an M.B.A. from the Wharton School of the University of Pennsylvania before joining Exxon Chemical Company in 1976. In 1986, after several assignments in Houston, Baton Rouge and Baytown, he transferred to Exxon Corporation in New York as Senior Financial Advisor in the Controllers Department. In 1988, he moved to Exxon Company, International as Financial Reporting Manager and later served as General Auditor. In 1990, Humphreys became Upstream Controller of Exxon Company, U.S.A.SUMMARYInnovation and change are the most important concepts discuss in modern dynamic business environment. The development of technology and the increasing burning needs of the people have created a dynamic environment of which the corporations may not be able to survive unless they simultaneously change the ir strategies with those global environmental and technological changes.Exxon Mobil is the worlds largest publicly traded international oil and gas company. They hold an industry-leading inventory of global oil and gas resources. They are the worlds largest refiner and marketer of petroleum products. And their chemical company ranks among the worlds largest. However they are also a technology company, applying science and innovation to find better, safer and cleaner ways to deliver the energy the world needs.Factors influencing the innovation and change differ according to the business context of the organization. Therefore it is more important to understand the context of business of which a particular corporation is engaged in before moving into a changing situation. In addition modern technological advances, cultural changes, structure of the corporation and regulatory requirements also can be identified as other factors to consider. However, there is also a need to understand th e magnitude of challenge faced in trying to effect strategic change. To do this it is useful to consider the type of change required the wider context in which the change is to occur and the specific to change that exists. The factors such as context, culture, environment and technology are the most important.It is important to any organization to realize the need of change. The strategic change is considered at the initiation of the business portfolio and it should be evaluated by time to time ongoing basis. Change can be in any context. Therefore it is important to understand why EMC needs the change. By nature EMC engaged in energy industry. The crude oil prices and the regulatory requirements of government in different countries and the authorities may change time to time. Those external forces of change can not be predicted and also effect to whole organization. As EMC operates in diversified cultures around the world the effects of the stakeholders in different arenas are also may be demanded for change.Past experiences of change management in EMC has proved that the growth of the company depends on how quickly the company finds the innovative products. The technological advancement in modern world has changed the way of research and development. The technology has facilitated a lot for improving productivity in R D sections.The complexity of the geographical area is the major problem. Managing the risks from increase in global greenhouse gas emissions is a problem of EMC to consider. Forcefield analysis can be used as a good technique.The effectiveness of managing the change is depending on how management, employees and finally the organization as a whole face to the change event. In here it is most important to understand the styles and roles of change in a particular organization. Education and communication, Collaboration, Intervention and Direction, Coercion can be considered as factors affecting the effectiveness of the change within the organizat ion. It is useful to think of change agency more broadly. Change agent is the individual or group that helps effect strategic change within an organization. When consider the top level management EMC has a number of change agent within the organization with massive experience.