Abstract Science Construction’s business is in planning, developing and building road projects. The major of its clients are municipalities, city governments, and other public sector entities. While the bankruptcy rates for these clients is very low, when economic downturns happen, their ability to pay in a timely fashion also suffers. This leads to businesses such as Science Construction needing to take on additional debt and to find creative methods in order to stay afloat during times of recession. Methods such as selling accounts receivables at discounted rates and taking larger lines of credit through banks and other lending institutions are some of the ways organizations can remain viable when their cash inflows have turned into a trickle. Science Construction is asking the Turkish Courts to postpone their bankruptcy proceedings for a year while they attempt to restructure. Through this, suggestions such as forcing shareholders to pay their debt to the organization, gaining credi
Introduction
This paper is a discussion for the case study “BP and the Deepwater Horizon Disaster of
2010” (2012). We will focus on the organization culture towards change, rather than the
engineering flaws which lead to that disaster. The Deepwater Horizon oil spill and explosion in
the Gulf of Mexico was a result of adopting the wrong leadership style relating to the
organization’s critical industry, hierarchal structure, and crisis management. There would have
been significantly important approaches to be followed such that to create radical changes within
the organization.
The Deepwater Horizon oil spill disaster in the Gulf of Mexico in 2010 is considered one
of the most significant environmental and management crises. Also BP’s reaction will be always
remembered as an example of the worst crisis management as well. I think that BP failed to deal
with this disaster by all means, especially the response of their CEO at that time, Tony Hayward.
He showed unethical, selfish and irresponsible behavior when he said, “I’d like my life back”.
BP had a similar incident in 1990 when the BP-chartered tanker American trader ran over its
anchor off Huntington Beach in Orange County, and consequently 400,000 crude oil gallons
were spilled in the ocean. BP’s response in this accident was totally different from that in the
Gulf of Mexico. Oil skimming vessels, the company’s crisis team, 36 specialists, and the
chairman James Ross arrived the site within 24 hours. Ross took the responsibility saying “Our
lawyers tell us it’s not our fault. But we feel like it’s our fault and we are going to act like it’s our
own fault.” On the other hand, when the oil rig Deepwater Horizon was destroyed, 11 workers
were killed, and the environment was hit hard by the oil spillage, Hayward commented that the
amount of oil was “relatively tiny in a very big ocean” (Jaques, 2015). Luo (2015) discussed 4
aspects which added to the inefficient crisis management by BP regarding the 2010 incident:
1. Shifting the Blame. BP blamed other contractors like Transocean for the rig explosion.
Hayward said: “This wasn’t our accident. This was a drilling rig operated by another
company. We are responsible not for the accident, but we are responsible for the oil and
for dealing with it and cleaning the situation up.”
2. Unconcern for Victims. Instead of expressing remorse and apologies for the victims,
reports showed that BP asked the cleanup workers and the people who got affected by the
oil spillage to sign waivers and confidential agreements in order to escape responsibility.
3. Inadequate Ability for Solutions. BP took more than 3 months to stop the oil leak.
Moreover, the amount of barrels leaking daily was estimated by around 1000 barrels/day,
however BP kept changing the rate to end up by 100,000 barrels/day.
4. CEO’s Inappropriate Words and Actions.
Regarding the corporate attitude towards change, Reardon et al (1998) stated four basic
styles that describes combinations of the basic styles called “patterns”. These so-called patterns
define the complexity behind leader behavior and competencies for radical change. So, these
four styles are: commanding, logical, inspirational, and supportive. Therefore, it is obvious that
style adopted by BP’s management at that time was purely commanding. The top management
should have adopted the logical leadership style in terms of showing accountability and
responsibility towards the accident rather than denying and shifting the blame. Moreover, they
should have followed the supportive style relating to the victims and their families, as well as the
whole community affected by the oil spillage throughout many years.
References
Ingersoll, C., Locke, R., & Reavis, C. (2012). BP and the Deepwater Horizon Disaster of 2010.
Cambridge, MA. This work is licensed under the Creative Commons Attribution-
Noncommercial-No Derivative Works 3.0 Unported License. Retrieved from:
https://mitsloan.mit.edu/LearningEdge/CaseDocs/10%20110%20BP%20Deepwater%20
Horizon%20Locke.Review.pdf
Jaques, T. (2015). Lessons from an oil spill: how BP gained - then lost - our trust. Retrieved
from: http://theconversation.com/lessons-from-an-oil-spill-how-bp-gained-then-lost-ourtrust-
40307
Lou, S. (2015). BP Oil Spill: “What not to do” in A Crisis Management. Retrieved from:
http://prssa.syr.edu/2015/04/05/bp-oil-spill-what-not-to-do-in-a-crisis-management/
Reardon, K.K., Reardon K.J., & Rowe, A.J. (1998). Leadership styles for the five stages of
radical change. Acquisition Review Quarterly, 2. Retrieved from:
http://www.au.af.mil/au/awc/awcgate/dau/reardon.pdf
This paper is a discussion for the case study “BP and the Deepwater Horizon Disaster of
2010” (2012). We will focus on the organization culture towards change, rather than the
engineering flaws which lead to that disaster. The Deepwater Horizon oil spill and explosion in
the Gulf of Mexico was a result of adopting the wrong leadership style relating to the
organization’s critical industry, hierarchal structure, and crisis management. There would have
been significantly important approaches to be followed such that to create radical changes within
the organization.
The Deepwater Horizon oil spill disaster in the Gulf of Mexico in 2010 is considered one
of the most significant environmental and management crises. Also BP’s reaction will be always
remembered as an example of the worst crisis management as well. I think that BP failed to deal
with this disaster by all means, especially the response of their CEO at that time, Tony Hayward.
He showed unethical, selfish and irresponsible behavior when he said, “I’d like my life back”.
BP had a similar incident in 1990 when the BP-chartered tanker American trader ran over its
anchor off Huntington Beach in Orange County, and consequently 400,000 crude oil gallons
were spilled in the ocean. BP’s response in this accident was totally different from that in the
Gulf of Mexico. Oil skimming vessels, the company’s crisis team, 36 specialists, and the
chairman James Ross arrived the site within 24 hours. Ross took the responsibility saying “Our
lawyers tell us it’s not our fault. But we feel like it’s our fault and we are going to act like it’s our
own fault.” On the other hand, when the oil rig Deepwater Horizon was destroyed, 11 workers
were killed, and the environment was hit hard by the oil spillage, Hayward commented that the
amount of oil was “relatively tiny in a very big ocean” (Jaques, 2015). Luo (2015) discussed 4
aspects which added to the inefficient crisis management by BP regarding the 2010 incident:
1. Shifting the Blame. BP blamed other contractors like Transocean for the rig explosion.
Hayward said: “This wasn’t our accident. This was a drilling rig operated by another
company. We are responsible not for the accident, but we are responsible for the oil and
for dealing with it and cleaning the situation up.”
2. Unconcern for Victims. Instead of expressing remorse and apologies for the victims,
reports showed that BP asked the cleanup workers and the people who got affected by the
oil spillage to sign waivers and confidential agreements in order to escape responsibility.
3. Inadequate Ability for Solutions. BP took more than 3 months to stop the oil leak.
Moreover, the amount of barrels leaking daily was estimated by around 1000 barrels/day,
however BP kept changing the rate to end up by 100,000 barrels/day.
4. CEO’s Inappropriate Words and Actions.
Regarding the corporate attitude towards change, Reardon et al (1998) stated four basic
styles that describes combinations of the basic styles called “patterns”. These so-called patterns
define the complexity behind leader behavior and competencies for radical change. So, these
four styles are: commanding, logical, inspirational, and supportive. Therefore, it is obvious that
style adopted by BP’s management at that time was purely commanding. The top management
should have adopted the logical leadership style in terms of showing accountability and
responsibility towards the accident rather than denying and shifting the blame. Moreover, they
should have followed the supportive style relating to the victims and their families, as well as the
whole community affected by the oil spillage throughout many years.
References
Ingersoll, C., Locke, R., & Reavis, C. (2012). BP and the Deepwater Horizon Disaster of 2010.
Cambridge, MA. This work is licensed under the Creative Commons Attribution-
Noncommercial-No Derivative Works 3.0 Unported License. Retrieved from:
https://mitsloan.mit.edu/LearningEdge/CaseDocs/10%20110%20BP%20Deepwater%20
Horizon%20Locke.Review.pdf
Jaques, T. (2015). Lessons from an oil spill: how BP gained - then lost - our trust. Retrieved
from: http://theconversation.com/lessons-from-an-oil-spill-how-bp-gained-then-lost-ourtrust-
40307
Lou, S. (2015). BP Oil Spill: “What not to do” in A Crisis Management. Retrieved from:
http://prssa.syr.edu/2015/04/05/bp-oil-spill-what-not-to-do-in-a-crisis-management/
Reardon, K.K., Reardon K.J., & Rowe, A.J. (1998). Leadership styles for the five stages of
radical change. Acquisition Review Quarterly, 2. Retrieved from:
http://www.au.af.mil/au/awc/awcgate/dau/reardon.pdf
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