3 Ways to Avoid Being the Next BP

Posted by on June 10, 2010 in Business Management, Business News, Public Relations [ 0 Comments ]

There is no shortage of lessons to take from the BP oil disaster that continues to spew hundreds of thousands of gallons of oil each day.  A short list, for instance, would include environmental responsibility over maximizing corporate profit, the need for accountable government oversight in the affairs of free trade, and the risks of dividing engineering projects through subcontracting.  Yesterday, Coast Guard Admiral Thad Allen conceded during a White House briefing that it will take years to repair the widespread environmental damage, much of which has still yet to be fully assessed.   According to a report on NPR this morning, the latest predictions suggest the earliest BP could completely seal the leak would be August.

With BP in the national hot seat for weeks on end and the waves of this crisis spreading to international waters, companies from all corners of the globe will likely have their eye on the drama unfolding at BP.  How has so much gone wrong for a company that is so big and what will be the final cost to BP once this is all said and done?   Is it even possible to repair BP from a PR standpoint if and when they do manage to completely repair the leak?

If you’re in business you know how many variables go into designing a business plan.  It seems pretty clear that BP decided to cut a few corners and it’s no longer just BP who is paying for their decisions.  With all the lawsuits that are sure to follow you can be sure BP will be paying some high out of pocket expenses.  So what do you need to do as a business owner to make sure you’re not the next BP?

  • Not biting off more than you can chew- The reservoir BP drilled into was so monstrous it had the potential to drastically cut our need for foreign oil.  BP was myopic in swinging for the fences only to strike out.  Promising to your clients what you want to do and what you can do are two different issues.  You don’t want to get the reputation that you promise more than you can deliver.
  • Don’t make empty promises- In the wake of the disaster, BP has made a number of predictions and deadlines it has been unable to meet. Patience does not run unlimited, so make sure you only promise what you know can be delivered.
  • Keep the lines of communication clear- Bp has placed blame on the companies it contracted with and vice versa.  Contracting can be an efficient business strategy, but remember when more than just your company is involved, the amount of control you retain diminishes.  Make sure to know your contractors are providing clear lines of communication so you are aware of everything going on.

Obviously there are many other ways your business can avoid catastrophe but these should get you started thinking in the right way.  One has to wonder if the media and legal woes of BP could have been avoided simply by addressing these types of concerns before they decided to drill.

Michael Dykstra is a writer at Resource Nation.  He writes extensively about  purchasing and outsourcing decisions for small business owners and entrepreneurs.

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