CorpComms Magazine

If the aero engine blows, you can ground the fleet. If there's a rat in your yoghurt, you can clear the shelves. It's a big crisis for the company concerned and probably for its peers too, but society at large is protected until the source of the problem is determined.

But what when there is no solution? The failsafe has failed and all the world can do is watch in disbelief wondering who allowed this to happen. It's on live feed 24-7, and there's apparently nothing anyone can do about it.

There are hundreds of lessons from the BP crisis - the relegation of joined-up corporate affairs in the post Lord Browne era, the mismatch between words and actions in the operational arena, the lack of bridges between the company and critical stakeholders, especially in America, the 'accelerator' role played by social media and the performance of a leader who wanted to lead from the front but was determined to do it 'my way'.  The list is endless. 

The lesson every organisation should heed, however, is very simple. You do not have a monopoly on your reputation in 'peacetime', and you place it in society's trust when things go wrong.

It became evident very quickly that the Deepwater Horizon disaster was going to go well beyond a corporate crisis to a national political crisis. An unsolvable problem of this magnitude will inevitably impact the reputation of everyone touched by it, all the way to the prime minister. They didn't need to wait for this to happen.

The company had enough talent to forecast risk and develop scenarios for such an apocalyptic event, and recognise the signals from moment one. If it was anyway going to become society's problem, then leapfrog the corporate phase and get the government to wake up to the problem it now faces.  It worked, to a certain extent, for the banks.

The management of reputation is too easily served by a communication strategy (a popular mistake many advisors still seem determined to make). The management of reputation can only be achieved through taking a forward-looking, outside-in approach that sees the business strategy in the context of society and the market today, and how it will evolve going forward.

If BP cared enough about the asset called reputation it would have invested in the capability of its managers down the line to make the right trade-offs between risk and return...and incentivised them accordingly.

It would have recognised that contractors are just as, if not more, important to its reputation than its own employees, and worked out how to bring them up to the same level.

It would have recognised the signals from the off and would already have built the relationships it needed to weather the worst of the storm. A year earlier, at a lecture to the Stanford Business School, Tony Hayward explained to attendees that BP was going in the wrong direction before he took over as chief executive because 'we had too many people that were working to save the world'.    

At one point 28,000 people and 4,000 ships were involved in the clean up operation.   When an organisation loses sight of its real societal role and replaces sound values with rhetoric, the re-balance is usually both big and painful.  Just ask Goldman Sachs and Toyota.

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