Description
Purpose
Using the case that was started in the previous week you will identify the relevant theory or idea from the textbook that you believe is applicable to this case. You will also develop a clearly defined problem statement that will be addressed in this assignment.
In the second part you will analyze the issues and apply the relevant theory identified above to address the primary failure of the case.
Task
Part 1
Identify the idea or theory from the textbook or lecture that you will apply to this case.
Outline the theory or idea.
Explain why this theory helps us better understand the Deepwater Horizon disaster?
Part 2
Using your knowledge of the case and the management theory / idea that you find applicable, address the following questions:
In order to prevent (or at least mitigate) the Deepwater Horizon disaster, who should have
done what, when, where, and why?
Who should have stepped up to stop this disaster?
If you became the new CEO of BP, what would you do in the short- and long-term to change
the company’s culture and organizational design?
Reflect on the theory that you discussed in the last part of the analysis and what it added to your understanding of this event.
Grading Criteria
Demonstrated a clear understanding of the relevant theory.
Supports the use of this theory with information from the readings and the case.
The response is written clearly with proper citations and formatting.
Identified and developed a practical solution to the problem
Utilized the relevant theory in a meaningful way in the solution
Provided a well thought out and written solution that is properly cited and formatted.
Part 1 is attached below.
Running Head: DEEPWATER HORIZON
Deepwater Horizon
Student’s Name
Institution Affiliation
1
DEEPWATER HORIZON
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Deepwater Horizon
Summarize the case, focusing on the major decisions that led up to the disaster
First, the decision-making process surrounding the Deepwater Horizon was complicated.
Majority of the decision-makers had only held their positions for short periods, and they did not
realize how quickly the situation would go south. Their chaotic decisions and multiple oversights
contributed to the disaster. For instance, there were inconsistencies in decision making in regards
to the best type of casing design. The opinions changed severally, and the final decision was not
unanimous. Investigations found that the option that was finally selected was saving “a good deal
of time/money,” according to one completion engineer. Their plans were also not backed up by
accurate research, like was the case with the centralizers. Although the plan was t use only six
centralizers, the team later realized that at least 21 centralizers were required for maximum
effectiveness (Ingersoll, Locke & Reavis, 2012). Therefore, chaotic decision-making and
oversight was the major contributor to the disaster.
What was the history of safety issues at BP?
Safety issues at BP caused two disasters in the mid-2000s. The first disaster happened in March
2005, where the BP Texas City Refinery had an explosion. Investigations showed that safety and
maintenance measures were not being adhered to due to the company’s senior executives’
cutbacks. One year later, disaster hit the BP Alaska Prudhoe Bay, which had a corroded hole in
their pipeline resulting in an oil spill of more than 200,000 gallons of oil into the bay. The
refinery had received warnings by Alaskan state regulators who pointed out that critical
equipment needed better maintenance, but their notes on safety issues in the Prudhoe Bay were
ignored. The next safety-related disaster was the Deepwater Horizon Rig. A safety audit in 2009
DEEPWATER HORIZON
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pointed out 390 essential repairs that needed immediate attention (Ingersoll, Locke & Reavis,
2012). However, the rig never docked. The crew only made temporary fixes that would help
maintain the rig’s functions despite knowing that the rig had maintenance issues as the crew
awaited further instructions.
What were the major components and the timeline of the disaster on the Horizon?
The disaster on the Horizon can be traced from the early 1990s after the $811 million loss. Costcutting measures started taking effect, and when Tom Hayward took over in May 2007, the
situation worsened. In a bid to boost the company, Hayward felt that the company was extremely
cautious, affecting its overall performance. Therefore, he removed several management layers
and slashed BP’s headquarter headcount. However, as more cost-cutting efforts were effected,
expensive safety and maintenance measures could not be undertaken, leading to two major
disasters in the 2000s. Acquiring the Macondo Prospect rights worsened the situation, and BP
was making more losses (Ingersoll, Locke & Reavis, 2012). The maintenance issues raised at the
Deepwater Horizon Rig intensified the problem, and the company did everything to maintain the
rig’s function even as software problems emerged. Ignorance at the Macondo well site,
increasing maintenance issues, oversights during decision making, and overconfidence of BP
that they had found oil led them to continue drilling despite the safety warnings received from
regulators.
What were the repercussions of the disaster?
First, the poor adherence to security warnings led to under-maintenance of the rig. It was poorly
maintained and required hundreds of repairs, which were hardly fixed despite the alarm raised by
regulators (EPA, 2018). The use of fewer centralizers led to high gas levels that prohibited hot
DEEPWATER HORIZON
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work that could release sparks, resulting in a disaster. Besides, as the gas levels rose, they would
trigger false emergency alarms that would interrupt the crew, so the team decided to shut down
the emergency alarms altogether. On the day of the disaster, there were two explosions and
crewmembers had to abandon the ship. Others resulted in jumping into the flaming ocean
resulting in 11 deaths and 17 injuries. More than 7000,000 oil gallons burnt for 36 hours, and
approximately five millions oil barrels spilled into the Gulf of Mexico (Ingersoll, Locke &
Reavis, 2012).
DEEPWATER HORIZON
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References
EPA. (, 2018). Deepwater Horizon- BP Gulf of Mexico Oil Spill. The United States
Environmental Protection Agency. https://www.epa.gov/enforcement/deepwater-horizon-bpgulf-mexico-oilspill#:~:text=On%20April%2020%2C%202010%2C%20the,of%20marine%20oil%20drilling%2
0operations.
Ingersoll, C., Locke, R., & Reavis, C. (2012). BP and the Deepwater Horizon Disaster of 2010.
MIT Sloan Management.
file:///C:/Users/GRACY/Downloads/2021012118460210_110_bp_deepwater_horizon_locke.revi
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