On April 20th 2010, an explosion on an oil rig in the middle of the Gulf of Mexico gave rise to the biggest ecological disaster in history. The company operating the oil rig, BP, has been much maligned by the media, the US Government and the US Senate House Committee on Energy and Commerce, with the BP board allocating $20bn towards clean up and compensation payments to those affected by the disaster. Criminal charges may well follow.
No one can be more maligned than the former Chief Executive, Tony Hayward, who lost his job earlier this week. A person that The New York Daily News describes as the most hated and most clueless man in America, but at least he only lost his job.
The subject of Tony Hayward’s handling of the disaster will be the subject of Business School Case Studies for years to come, as a ‘how not to lead in a crisis’, where at times he appeared insensitive and at others completely out of touch.
Maybe he followed some ‘anti management’ school of leadership thought in how to manage?
This post is written not with any particular insight into Mr Hayward, BP or the disaster, but on observations based on interviews in the press and on TV.
Here’s some lessons you should apply whenever you’re in crisis, or road rules if you aren’t:
- If you’re going to say sorry, don’t make it about you
- Stay true to your values – when Mr Hayward came to his job 3 years ago he made it clear that safety was a top priority for him
- It’s a team effort – introduce the team and put the team at the forefront of what’s going on
- Acknowledge the victims and do what you can to help them
- If you get criticised take the feedback and act on it
I have read in the press that Mr Hayward should have resigned earlier. Personally I’m not so sure about this. In my opinion resigning when the problem appears to be fixed (at least temporarily) was the sensible thing to do. Leaving a job half finished is like leaving a boat without a rudder and labling yourself as a quitter.
Good leaders must face facts, prepare for the worst case scenario, draw on the whole team, show constant concern for others acknowledge mistakes and not make the same ones twice, and do the honorable thing if getting in the way of company progress.
No one knows whether BP did a good job or not – the technical difficulties in resolving the problems so deep below water are hard to imagine. Investigations by the authorities will be the judge of that. But whils BP mobilised thousands of current and former employees from around the world, Mr Hayward became the main attraction.
Jim Collins in his book Good to Great: Why Some Companies Make the Leap… and Others Don’t introduced the concept of Level 5 leaders. These are the leaders in an organisation which help differentiate the performance of the truly great companies from the also rans. Here’s a summary of the attributes of a level 5 leader:
* Level 5 leader is an individual who blends extreme personal humility with intense professional will.
* Level 5 leaders are the one who takes companies from good results to great results
* Getting right people and creating a culture of discipline (which consists of disciplined people, disciplined thought & disciplined action) are important factors along with Level 5
From the evidence in the press and from interviews it would appear that Mr Hayward is not a level 5 leader. But, for the sake of the shareholders and the employees and the other stakeholders in BP, we hope that Bob Dudley, Mr Hayward’s replacement, that he is.