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How can BP regain trust?

by Nigel Middlemiss on 20/04/2011 12:40:45 in Issue 57 | share me: del.icio.us | digg | reddit | Tweet

Nigel Middlemiss, knowledge director at Echo Research, considers the mood at BP's annual meeting - one year after Deepwater Horizon

About the author:

Nigel Middlemiss

Knowledge director at Echo Research

How can BP regain trust?

BP's annual general meeting last week was a litmus test of sentiment today around the oil giant since the Deepwater Horizon disaster. 

Protesters were at the meeting from American communities affected by the pollution, certainly. But the net had widened across North America. There were campaigners against oil extraction from tar sands in Canada, alleging greater pollution from the process. There were representatives of American churches protesting that the board member for safety and environment had not been fired at the same time as the previous chief executive. They objected to the remuneration being offered to senior BP people, too.   

With the Texas City Refinery explosion only a few years back, and Deepwater Horizon one year ago, a snowballing process was under way. Errors, or misfortunes, 'gave permission' for an onslaught on a reputation, and suddenly two things wrong encouraged the thought: 'There's an awful lot wrong'. 

And yet, and yet...for some observers, the opposite can be argued. For them, BP worked frenetically hard to overcome the accident, later apologising unreservedly, paying out huge damages, and initiating restorative processes. The company had behaved, in a word, like a group of reasonably normal and reasonably decent human beings, however awful the events were that they had to preside over. Even the chief executive's controversial words 'I want my life back' were a way of saying he would like to rewind history and for things to have taken a different course, not that he was fed up at having to spend time resolving the problem. Some onlookers certainly felt they could well have said the same in his position. 

In the same way there are two schools of thought about BP's risk communications. Some are critical. Others believe that, try as BP might, the media were less attentive when they had so much evidence of disaster to film and write about - black smoke clouds, wildlife paralysed, local people's reactions. 

Another almost insuperable challenge for BP's communicators was the technical uncertainty, the bafflement evidenced by engineers as they unsuccessfully tried one solution, then another, as the weeks went by. The uncertainty eroded trust. The sense of a technology out of control and with an uncertain conclusion ahead made the company's competence look questionable. 

Uncertainty always does erode trust. In a very different context, uncertainty about a quoted company often depresses its share price more than the certainty about the extent of downright bad news. A well-known 'trust game' has someone standing on a chair and falling backwards to be caught by friends, and uncertainty about the catchers' competence makes the process impossible to go through with. 

BP says it wants to get back to greater levels of trust, that verbal touchstone for the corporate world, often repeated, less often explained.  Trust demands direct evidence of someone's honesty, competence and reliability - evidence that we can query, test, hear and see for ourselves at first hand.  If we don't get that, we look for indirect evidence provided by a trustworthy third party - a regulator, a reliable journalist, who can do it for us.  Trust takes time to build; it requires the relaxation of our self-protective suspiciousness about others' motives. Echo's own 'World in Trust' report says this and much more about generating faith and confidence in an organisation. 

BP will need to apply trust communications with fresh vigour as time heals uncertainty and the loss of faith after the accident. 

There is also encouraging evidence that other lessons for changed behaviours have emerged after Deepwater Horizon. One is that you have to avoid misalignment between the views of 'response professionals' and top-level management, and the best way to do this is with crisis 'dry-run' rehearsals involving both parties.  Another systemic learning is that when accidents run, not for hours or days, but months on end, good 'people continuity' is indispensable for a team to take over from another to carry out often exhausting tasks round the clock. Then, mechanisms have to be developed to cope with inputs from the thousands who now descend through the social media onto the 'owners' of such an accident. About 120,000 suggestions were received by BP for how to cap the leak, and some who felt their solutions were ignored turned in frustration to the media. And perhaps most important is - as a crucial 'business as usual' discipline before any further accident - to keep excellent records of who your stakeholders are, around all your operations, of who you need to speak to in difficult times. This requires pin-sharp mapping and profiling of who they are, in good time. When disaster strikes, it's too late. 

It's an odd paradox, but a kind of consolation - if cold comfort - that technology-based industries improve their accident record by having accidents. Lightning rarely strikes twice in the same place.  Ingenuity driven by public pressure works against - though doesn't guarantee against - repetitions. 

Car design shows this. Safety improvements have been driven by technical and human failures. In 1899 a man died after a taxi ran into him in New York's Central Park, America's first car accident fatality. Shortly afterwards, the first fender or bumper, a type of wire-mesh cowcatcher, was invented. Today cars have smart systems that hold them to their motorway lane, radar scanners that watch blind spots, automatic sensors to monitor vehicles ahead and apply braking in good time, all in response to ramped-up safety concerns. 

Deep sea drilling will not be abandoned; the world's need for energy is too great. What BP and the rest of the industry must do is avoid complacency in the search for ever greater safety. Above all they have to avoid the trap that one automobile spokesperson in the 1940s fell into, when he announced to journalists: 'The latest models are as safe as science can make them.'

http://www2.echoresearch.com/downloads/files/Echo_Research_CR10_Report.pdf?submit2=Download+Report  

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