BP DEEPWATER HORIZON OIL SPILL: STRATEGIC IMPLICATIONS The BP Deepwater Horizon oil spill accident of April 20th 2010 that caused a gas release followed by the explosion that took place causing hydro carbons to leak into the Gulf of Mexico posed a lot of strategic implications in the competence, capabilities, internal resources and Corporate Social Responsibility of BP. The implications of the Oil Spill underscores the Icarus paradox, which holds that the very capabilities that give an organization its source of competitive advantage can become constraining with changes to the external context. Teece (2009) emphasised that dynamic capabilities revolve around three generic types namely: Sensing (ability to scan, search and explore the external …show more content…
The key strategic and operational issues present in this case are encapsulated in BP materiality matrix, which revolves around internal priorities and external concerns. The major issues confronting BP in the Gulf of Mexico following the Deep water Spill are environmental and economic restoration as well as contending with legal proceedings. One of the basic strategic issues BP had to face is posed by climate change and managing carbon risks and understanding that operating at the frontiers involves deep water and gas, oil seeds and hydraulic fractions. Operationally, BP had to embrace good corporate governance through Board / Executive control with oversight functions, establishing risk management strategies and financial sustainability. BP’s success was based on using Porter’s competitive force model and organizational design to achieve their strategic …show more content…
This is the open-system view of the organization. Prior to the accident, BP was concerned with its procurement process, technology development, infrastructure and human resource. BP was also using SWOT Analysis through which the company examined strengths, weaknesses, opportunities and threats. Internal analysis here refers to BP’s capabilities and resources, which define her strengths, and weaknesses while opportunities and threats derive from the external context of BP operations. However, after the accident, BP became more aware that the external environment is where opportunities and threats exists and must be constantly monitored and scanned. This can be explained with The ‘PESTEL’ model which identifies the key elements of Political (Legislation/ Ideology, government expenditure and legislative factors); Economic (Macro-economic factors and business cycles); Socio-demographic (Changing societal attitudes towards ethical standards and life style choices); Technological (technologies that can affect an organization); Ecological / Green issues (Opportunities and threats, impact of pollution or reclying and carbon reduction) and legal factors (legislative or regulatory framework under which the company operates that create opportunities and threats). The essence of using the PESTEL model here is to identify the key drivers that allows scenario planning to occur in relation to market
The British Petroleum (BP) oil spill in the Gulf of Mexico was one of the worst ecological catastrophes in human history, causing vast damage to a fragile and beautiful ecosystem while at the same time calling attention to the deficits in current approaches to energy prospecting, risk management, and cleanup. This analysis of the Deepwater Horizon explosion and oil spill will devote attention to the following questions: (a) What kind of technology is in use for deep-sea oil extraction, what are the factors that accounted for the BP catastrophe, what were the statistical components of the spill in terms of volume and concentration, and what was the spatio-temporal scale of the oil spill? (b) What were the environmental (physical, biological, hydrological, and atmospheric) impacts of the oil spill, in addition to the economic and social impacts? (c) What were the scientific, technological, and policy solutions implemented by various actors to pursue the cleanup of coastal areas, wildlife, and wetlands damaged by the oil spill? (d) What is the feasibility of long-term biodiversity conservation measures and the limits of such solutions?
April 20, 2010, a tragic disaster struck the Gulf Coast. British Petroleum deepwater Horizon oil rig cracked from three places and raw oil leaking into the sea. .it was considered that over 60,000 barrels of oil a day are mixing with Gulf water and Oil spread over 70 miles to 130 miles into the sea and can be seen from space.
In my opinion, BP's response to the oil spill wasn't the best. Plus their spokesperson Tony Hayward's comments did little to help the situation. The response should have been about damage limitations. Hayward's responses made the company seem aloof and unconcerend about the environmental damage being done. When they gave an amout of barrels that were leaking into the ocean, they gave the wrong amount which hurted their credibility. They deflected the blame for the accident. BP would call the oil spill the "Gulf of Mexico oil spill" while the rest of the world called it the "BP oil spill." They might have took the blame but they said it wasn't their accident however they would take responsibility to clean it up even though it wasn't their fault. I think the fact that they used social media to show show updates and progress was a smart move since it is probably now the biggest media median. However, everything else was not the best way to handle this whole situation.
Media outlets demanded answers from BP concerning what caused the disaster that started April 10, 2010. It became one of the worst environmental spills in U.S. history. Instead of owning up to the problem and taking responsibility, the company went on an offensive-blame-fueled binge that left those affected by the events horrified and angry. (Houpe, 2010)
The oil spill disaster exposed the major factors in BP’s external environment. Those key factors are government regulation and shareholders. The reason that government regulation is such an important external factor for BP is because those regulations can decide the economic feasibility of projects and the related penalties for violations. Had BP been aware that it would be assessed nearly $18 billion in penalties related to regulation violations, they may have decided to comply or possibly not drill in the Gulf Coast region. However, BP ...
In 2010, there was a huge oil spill near the Gulf of Mexico that we now know as the BP Oil Spill today. The Spill sent about 170 million barrels of crude oil into the Gulf of Mexico. The spill killed 11 men aboard the deep-water Horizon. The BP Oil Spill impacted the environment very negatively. There were different types of environmental impact as a result of the Oil Spill, but the two that grabbed my attention the most are the Polluted Air and the Contaminated Food Chain. The first impact that grabbed my attention was the Polluted Air. Because of the Oil Spill, the air around the surroundings neighborhoods was polluted. All the lightest chemicals in the oil that had spill evaporated within hours of the incidence forming air pollution particles. These particles that are in the air poses significant threats to the human health from being inhaled. The chemical found in the particles that was formed is known as Volatile, which has been known to cause respiratory irritation and central nervous system depression (Solomon & Janssen, 2010). The second impact that grabbed my attention was the contamination of the food chain, specifically the food chain of sea animals that lives near the Gulf of Mexico. Scientists found traces of oil in zooplanktons; this could only mean that the sea creature has had contact with the spilled oil. According to the Staff at Houston Business Journal (2012), “Baby fish and shrimp feed on the tiny, drifting zooplankton, and then introduce contamination and pollution to the larger sea creatures in the food web.” With these findings, it isn’t going to take long before the baby fishes become grown and caught by fishermen and before we know it, it’s on our dinner plate. And here we are eating fishes w...
On April 20, 2010, BP’S deep water horizon drill exploded in Gulf of Mexico and this oil spill killed 11 innocent workers and caused severe damage to the environment. “It was the worst environmental disaster in US history and BP lost his reputation worldwide”. The oil spill created negative attention from media and public. BP’s “Gulf of Mexico Restoration” website uses these three strategies to try to repair its reputation: pictures of its new employees to show its dedication to creating more jobs and ensuring the safety in the company, images of emergency services and clean-up programs to show its quick responses and efforts to prevent more damages, and clear language about its legal proceedings and investigations to show its commitment to the affected people and environment.
The BP oil spill began on 20 April 2010 in the Gulf of Mexico on the BP-operated Macondo Prospect. On April 20, 2010, 126 workers on the mobile offshore drilling unit Deepwater Horizon were in the process of temporarily closing the exploratory Macondo oil well. That evening, an explosion abroad the drilling unit set off a chain of events that eventually led to the sinking of the Deepwater Horizon. Eleven crewmembers lost their lives and others were seriously injured, as fire engulfed and ultimately destroyed the rig.
In recent years companies have been suffering a loss of legitimacy and confidence caused by a growing social awareness about their irresponsible behavior related to social injustice and damage to the environment. In this context, the case of the oil company Shell allows us to have an overview of the complexity of this type of situations. In the 90 ' Shell was involved in two major problems that has caused serious tensions between the company and its stakeholders because of the removal of the Brent Spar oil platform and problems in Nigeria. The relevant stakeholders involved in this case were consumers, investors and specially the local community that were affected with pollution caused by the company operation.
Arthur, A., Thompson, Margaret, A., Peteraf, John, E. Gamble, A., J., Strickland III. (2014). Crafting & Executing Strategy: The Quest for Competitive Advantage 19e: Concepts & Cases. C6-C25.
The BP distain for truth and costly crusades cause issues that left an unsettling picture of the organizations concerning the safety consciousness of the company. BP has a long history for being unreliable, when it comes to the safety of others. They pushed the envelope beyond good sense to maintain profit margin and not good health. As a person born and raised on the gulf coast of Alabama, I have firsthand knowledge many members are still disgusted with their attitude towards the environment. In my eye’s no, not to those who were affected. Even with a new attitude, new slogan and CEO. BP is still ran by the same people who lead us to the oil disaster.
Nelson, A.N. 1971. Effects of oil on marine plants and animals. London: Institute of Petroleum.
On April 20, 2010, the Deepwater Horizon oil rig, located in the Gulf of Mexico exploded killing 11 workers and injuring 17. The oil rig sank a day-and-a-half later. The spill was referred to as the Deepwater Horizon oil spill, BP oil spill, Gulf of Mexico oil spill, and BP oil disaster. It was first said that little oil had actually leaked into the ocean but a little over a month later the estimate was 12,000-19,000 barrels of crude oil being leaked per day. Many attempts were made to stop the leak but all failed until they capped the leak on July 15, 2010, and on September 19 the federal government declared the well “effectively dead.” In the three months that it took to finally put a stop the leak, 4.9 million barrels of oil were released into the ocean. The spill caused considerable damage to marine and wildlife habitats and the Gulf’s fishing and tourism industries. The White House energy advisor, Carol Browner, goes as far to say that the Deepwater oil spill is the “worst environmental disaster the US has faced.”
On April 20, 2011, an oil rig in the Gulf of Mexico exploded on British Petroleum’s (BP) Deepwater Horizon. As a result, of the 126 BP crew members aboard, 11-15 were reported missing. Six days later, underwater robots reveal at least two leaks are dumping 1,000 barrels of oil into the Gulf per day. Consequently, this would become one of the worst oil spills in the history of the United States and perhaps the petroleum industry. This recent Oil Spill portrays one of many dilemmas BP has faced as it scrambles to expand and globalize itself as a transnational corporation in the world economy against other oil and gas companies. Although this disastrous event has affected BP negatively, the company has found a way to overcome it, while still becoming the 6th largest in the world; it continues to do this by offshoring, outsourcing, and merging with other oil and gas companies, three key strategies BP has been using since its establishment in 1909.
The April 2010 oil spill in the Gulf of Mexico will forever change the way Americans view deepwater oil drilling. No one could have foreseen that BP’s well would spew into the Gulf waters for over 80 days before it was successfully capped. Over the years, many articles have been written about the disaster, and many different viewpoints given in the articles. This essay discusses the oil spill’s effect on Gulf coast animal and plant life, plus whether the government is implementing effective legislation regarding the spill.