CorpComms Magazine

Opining about poor communications can appear like shooting the messenger when crises hit corporate operations with devastating consequences.

However, just over one year on from the explosion that rocked BP's Deepwater Horizon oil rig in the Gulf of Mexico in April 2010, it's clear that this was a crisis with serious shortcomings in communications as well as in engineering safety.

Eleven people died, while American coastal waters were blackened with 4.9 million barrels of oil - 20 times more than in the Exxon Valdez oil spill in Alaska in 1989.

It resulted in a $20 billion compensation bill and a $30 billion assets sale programme to pay for it as well as censure from President Obama, BP's first annual loss in almost 20 years and the replacement of chief executive Tony Hayward.

While the well has now long been secured and the environmental effects are less extensive than originally expected, BP has now been tagged America's most hated company and will need much longer to repair its reputational damage.

Learn this lesson

So what lessons can communications professionals draw from the handling of the biggest oil spill in American history?

It is too early to say, according to BP, whose new chief executive Bob Dudley has brought back Peter Henshaw, the former communications head of its TNK-BP Russian joint venture, to head group communications. 'We're still handling it and it's too early for us to reach any conclusion,' says director of group media David Nicholas.

'It's a year on but the work in the Gulf of Mexico is ongoing and the communications are ongoing. Obviously we have a lot of work to do to communicate all that BP is doing to restore its reputation but I would not give any verdict on how we did. Others will draw verdicts but we are still communicating and still getting on with doing the work.'

Financial PR agencies Brunswick and Powerscourt who advised BP also both decline to comment, leaving others to analyse the facts with the benefit of hindsight.

How it played out

The explosion that happened on 20 April 2010 was caused by a swell of natural gas that burst through a recently-fitted concrete core that sealed the well. As the gas travelled up the riser - a large pipe joining the subsea blowout preventer with the floating surface rig to stop mud from spilling out onto the seafloor - it caught fire.

The rig, leased by BP but actually run by offshore drilling company Transocean, sank two days later, but the bigger environmental damage was done by mud escaping from the burst riser, allowing oil to spill into the Gulf.

With efforts to stem the leak beset by technical difficulties, a permanent seal was not put in place until 12 July and it took until 19 September for the well to be completely secured.

Understanding the fall-out also requires a communications chronology. Initial estimates from BP and US Coast Guard officials indicated a leak of as much as 1,000 barrels a day but the final official estimate reported that 53,000 barrels of oil per day were escaping from the well just before it was capped in July

BP began documenting its daily response efforts on 6 May, started providing live video broadcasts of the leak on 21 May and set up a call line on 31 May to take clean-up suggestions, which reached a total of 92,000 by late June, but still came under heavy attack for doing too little too late.

White House energy adviser Carol Browner called the spill the 'worst environmental disaster the US has faced' and BP's shares reached a low on 25 June 2010, valuing the company $105 billion lower than the day disaster struck.

The public gaffes

Some of the adverse sentiment can be plotted against the central role Hayward took in communications. In May, he called the oil spill 'relatively tiny' in comparison with the size of the ocean and said its environmental impact would be 'very, very modest'.

Later that month, he was widely criticised for saying 'I would like my life back' after Louisiana reporters asked what he would like to tell locals whose livelihoods had been affected.

He apologised on the BP America Facebook page but in a 8 June interview on NBC Television, President Obama said that Hayward 'wouldn't be working for me after any of those statements'.

On 18 June, BP chairman Carl-Henric Svanberg said Hayward would step away from daily involvement in the company's efforts in the Gulf.

However, the next day Hayward was in the Isle of Wight, having taken a 'day off' to see Bob, his jointly-owned boat, participate in the JP Morgan Asset Management Round the Island yacht race.

Rahm Emanuel, President Obama's chief of staff, said that Hayward had committed yet another in a 'long line of BP gaffes' by attending the race while the oil spill continued. On 27 June, BP announced Hayward was being replaced.

Warwick Partington, managing director of MTM Communication Skills Training, says: 'As media gaffes go, Hayward appears to have been in a class of his own.'

Hayward's 'wanting my life back' comment appeared highly insensitive to the plight of others who had lost their loved ones or their livelihoods, he observes, while the Cowes attendance added to public feeling that here was a man who just didn't get the concern or emotion that people felt about the tragedy.

'Appearing at a Congressional Inquiry with 11 pages of carefully crafted words, but reading them out without any apparent connection with the emotions expressed in them, left most onlookers that included a global TV audience astounded by his apparent lack of genuine feelings and concerns,' adds Partington. 'It may have satisfied the lawyers, but did nothing for Hayward's or BP's reputation.'

Schoolboy errors

Peter Krijgsman, a former corporate communications director for Barclays Capital and ING Barings who now operates as a public relations and communications professional, agrees, drawing four tactical communications lessons from the way BP handled Deepwater.

'Firstly, don't field your chief executive as the chief spokesman if he or she hates media attention as much as Hayward did,' he advises. 'Also, don't engage in debate borne of specialist knowledge that no-one else has - it will feel patronising to most and should wait until the post-mortem. Thirdly, if you must go on holiday in the middle of the crisis, go somewhere modest, private and preferably a little miserable (not your yacht).

'Finally, don't spin it. Get on with the job and put the rescue of your reputation on hold until later. People will later remember this as indicative of modesty and commitment to hard work. The best spin will be remembered as arrogance.'

However, as James Henderson, chief executive of financial public relations agency Pelham Bell Pottinger, points out, no company was likely to emerge unscathed from a disaster of Deepwater's magnitude.

'Were there communications aspects they handled badly?' he asks. 'Of course there were, and, to the continuing discomfort of the board, those will be remembered far more than what they got right.

'BP needed to be seen to be in control, authoritative and to calm the wild hysteria as much as it could. Because they did not inspire confidence from the off, the situation was allowed to spiral.'

Other strategic and tactical mistakes added to the difficulties facing BP's communications efforts. One, says communications consultant and crisis management specialist Joanna Biddolph, was that the company's approach was incorrectly tuned primarily to investor relations.

'BP was in difficulty,' she says, 'with a chief executive who was not comfortable with journalists, but very good at his job with financial analysts, and a chairman whose English was not up to scratch.

'Training would have identified these major weaknesses - and forced BP to think about what to do about its public face in a crisis.'

Tony Langham, chief executive of Lansons Communications, argues that a second (but linked) error, was giving the principal agency work to two financial PR companies.

'Several key communication errors are fairly widely agreed,' he says. 'There was the failure to sound sorry enough early on, overuse of the very brave Tony Hayward as BP's voice and the mistaken use of a Brit to front an advertising campaign aimed at the people of Louisiana.

'However the main lesson is that true corporate public relations is a different discipline to financial corporate PR, in a crisis being played out in real time.

'Turning to a City agency to handle the crisis was a mistake. The City advisers should have been kept where they belong, advising on relations with the City not the real world.

Few experts believe BP's mistake was in failing to prepare for a wide range of crisis scenarios. As Bobby Morse, senior partner at financial public relations group Buchanan, says, all large oil and mining with potentially high environmental impact are invariably well-prepared for crises to develop, possessing controlled, effective templates for responses.

'BP would have had a plan, but where they let themselves down was in their speed of response,' says Morse. 'The most important times in the communication of a crisis are the first few weeks and months. They are crucial to how a crisis is perceived.'

Partington says BP failed to speedily explain the facts, empathise with audience concerns and emotions and tell the human story of what was being done, the challenges being faced and the outcomes.

However, BP's poor image can be traced back long before Deepwater, with the company suffering environmental disasters from Alaska to Texas under previous chief executive Lord Browne that suggested the focus of its engineering culture, at least in the US, had slipped from best practice to cost-cutting.

Ebenezer Banful, director of brands and culture change consultancy New Brand Tribalism, even believes that 'Beyond Petroleum,' the environmentally-friendly positioning of BP under Browne 'was a sham of a marketing and communications paint job, albeit very expensive and neatly articulated'.

'With devastating consequences, it became clear that the reality and what they were delivering was very different to the rhetoric,' he says.

In 2006, after the Texas refinery fire that killed 15 people, Hayward reportedly criticised the way communications was handled in BP, arguing that it was too directive and did not listen enough. He changed the company's communications team after his appointment as chief executive but Banful says wider societal changes are also part of the reason why BP was unable to respond effectively.

'What seems clear is that the traditional tactics used by organisations to influence and control their audiences no longer have the desired effect,' he says. 'As power slips away, businesses need to rethink how they engage with the people around them if they are to build credible, authentic and highperforming organisations. Twentieth century management thinking will no longer solve 21st century challenges.'

It's an argument that also finds support from Tim Johns, formerly vice president of global corporate communications at Unilever and now a partner in research-based consultancy The Change Agency. He believes there is a deeper issue stemming from the way many modern multinational companies are structured.

'The main lesson from what happened at BP is about management style and behaviour,' he says. 'Communications always struggles when it is out of sync with how companies are actually behaving.' He argues that traditional command and control cultures are waning under pressure from globalisation, the Internet and social media boom and a generation of young workers who simply won't accept them, while an increasingly sceptical public is highly-sensitive to differences between a company's statements and its actual behaviour.

Outsourcing operations to third parties also leaves organisations highly compartmentalised and less able to directly shape and influence the corporate culture.

'The real learning is about how you get a very large organisation with its rules and regulations to ensure that its people are very much part of its processes rather than just being done unto,' he says. 'It's about the culture of an organisation being embedded in its people.

'If communications is unable to influence policy beyond coming in at the last moment to try and rescue corporate reputations, it's like playing football on one leg.'

As the post-mortems continue, that is a sobering thought for Britain's largest companies.

Click here to read about the role of social media in the BP crisis

Click here and scroll down to read six columnists' comments, one year since the crisis

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