The BP oil spill papers: A case study in management failure
Who needs Harvard Business School when you’ve got the BP oil spill commission? Case studies are all well and good, but the presidential group’s reports of what went wrong with the decision making amid the government’s response read like one of the most instructive business case studies I’ve seen in a long time.
The working papers, released Oct. 6, reveal a poorly managed response, a delay of the release of information about the spill’s worst-case scenario, and confusion about the severity of the spill. They offer a rare comprehensive look at decision-making in a crisis that is immediate, highly detailed and even harsh in its assessment. The average case study is none of those things.
Among the findings of the commission: agencies differed over how to describe the spill publicly as its immensity became better understood;studying the fate of the spilled oil was not “peer reviewed,” as some officials had stated; and a “lack of regulatory guidance” contributed to the confusion.
But it is the decision-making problems that will resonate most with leaders, no matter whether they lead a corporate office, a government agency or a non-profit organization. The “Decision-Making Within the Unified Command” report places significant blame on a circumvented command structure, in which “inter-agency groups were activated but later marginalized” while top agency chiefs, who were often political appointees, “remained very involved in the response and took over addressing key issues.”
While that might have helped with image management, the report notes, it injected politics where it wasn’t needed. “Such involvement may have increased accountability, and helped to make controversial decision-making more transparent, but it also made the decisions more subject to criticism and delay on political grounds,” the report notes.
Likewise, the established response teams became, as the working papers call them, “report-to” bodies rather than “decision-making” teams. That bypass of the traditional structure made it confusing to the public and to responders where authority lay. In the flap over using dispersants to clear the oil, for instance, political appointees who had not been part of earlier analyses were suddenly making decisions despite a lack of knowledge.
In other words, the government suffered from the classic traps of micro-management and too much centralization. As the report states, “much of the unified command
structure is designed to push issues down to the most local level at which they can be addressed. Having strong agency head participation tended to elevate decisions that might have otherwise been addressed closer to the source of the question,” where, presumably, the amount of knowledge was greater.
A weakened presidency, heightened national political tensions and the magnitude of the spill all contributed to decision-making meddling from higher-ups. But any organization in crisis often faces the same risk: top executives want to look like they’re taking swift action, when really the best course might be simply letting go. The temptation for leaders to wade in–no pun intended–and micro-manage during a crisis blurs decision-making structures, confuses front-line workers and slows down action as everyone waits to see what the higher-ups want now that the traditional process has been shattered.
In a crisis, leaders would be wise to remember that the best way to burnish their image as a take-action chief is to get the crisis solved. And that usually means stepping back and letting people do their jobs.
