Deepwater Horizon Case Study 1

BP DEEPWATER HORIZON CASE STUDY

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Bp Deepwater Horizon Case Study

The Deepwater Horizon case study reveals that there were organizational problems

present before the well explosion. One of these problems was the decision making model the

partners used. Witnesses claim to have seen the representatives of the two companies arguing

unable to agree on the meaning of collected data (Eley, 2010). The relevant theory to this

problem is the garbage can model where characters have problematic preferences that may

appear irrational in hindsight (Lomi, 2012). However, the evidence-based decision making

model and the administrative model may prove better alternatives. Therefore, the employees of

the two companies should learn to make team decisions based on evidence on all risk factors,

which will improve both safety and efficiency.

The second problem the rig faced is the managements Business ethics in risk

management. Although they knew, the risks associated with doing so, BPs management decided

to cut costs in the construction of the rig and the oil well, which resulted in safety hazards

(Mason, 2011). Symptoms of these included the desire to cut costs and time thus sacrificing

optimal conditions for more manageable conditions (Mason, 2011). Additionally, the

communication between departments and corporates was poor. They used a rational model in

making this decision to cut costs and construction time and hence increase profitability (Morcol,

2006, pp.5). Collecting relevant safety data before commencing operations would have

significantly reduced the risk (Hopkins, 2011). Therefore, an evidence-based approach involving

experienced workers is best.

The third problem is their decision-making biases. In the corporate world, constraints

force corporation to make decision biases in favor of time and cost savings (Smith, 2011,

pp.138). Although the workers had several warnings, they continued working on the well. They
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were overconfident in their expertise ignoring differing opinions (Mufson, 2010). Alternative

models applicable to this situation are the evidence-based model, or an administrative model

where expert opinions are analyzed and the best course of action chosen (Daft, Kendrick, &

Vershinina, 2010, pp.318). A recommendation for this case is to collect comprehensive data

before making major decisions to decrease risk factors.

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References

DAFT, R. L., KENDRICK, M., & VERSHININA, N. (2010). Management. Andover, South-

Western/Cengage Learning.

Eley, T. (2010). What caused the explosion on the Deepwater Horizon? - World Socialist Web

Site. [online] Wsws.org. Available at: https://www.wsws.org/en/articles/2010/05/spil-

m14.html [Accessed 2 Oct. 2015].

Hopkins, A. (2011). Risk-management and rule-compliance: Decision-making in hazardous

industries.Safety Science, 49(2), pp.110-120.

LOMI, A., & HARRISON, J. R. (2012). The garbage can model of organizational choice:

looking forward at forty. Bingley, Emerald Group Publishing Limited.

LUTGE, C., & JAUERNIG, J. (2014). Business ethics and risk management.

http://site.ebrary.com/id/10815051.

Mason, R. (2011). BP cost-cutting a cause of Gulf of Mexico oil spill, US report finds. [online]

Telegraph.co.uk. Available at:

http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/8763644/BP-cost-

cutting-a-cause-of-Gulf-of-Mexico-oil-spill-US-report-finds.html [Accessed 2 Oct.

2015].

Morcol, G. (2007). Handbook of decision making. Boca Raton: CRC/Taylor & Francis.

Mufson, S. (2010). BP's internal investigation of oil spill: Several 'warning signs' were ignored.

[online] Washingtonpost.com. Available at: http://www.washingtonpost.com/wp-

dyn/content/article/2010/05/25/AR2010052505157.html [Accessed 2 Oct. 2015].

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Smith, G. (2012). Management obligations for health and safety. Boca Raton, FL: CRC Press.