BP Company Case Study

1. BP COMPANY CASE
AYDIN SANCAK - MEHMET METİN - OSMAN KAYTAN - SEZEN GÜRDAĞ
MARKETING MANAGEMENT
APRIL 1, 2016

2. COMPANY OVERVIEW
• BP plc. is one of the largest vertically integrated oil and gas companies in the
world.
• The company's operations primarily include the exploration and production
of gas and crude oil, as well as the marketing and trading of natural gas,
power, and natural gas liquids.
• BP operates in Europe, Asia Pacific, Africa, and the Americas.
• It is headquartered in London, the UK, and employed 84,500 people as on
2015.

3. • William Knox D'Arcy, the founder of BP, entered the oil industry in
1901 by obtaining an oil concession in Persia (Iran).
• In 1909, D’Arcy formed the Anglo-Persian Oil Company (APOC).
• British navy switched from coal to oil. In order to protect its
supplies of this now-crucial military resource, the British
Government acquired a controlling share (50.0025%) of APOC in
1913.
• It was renamed the Anglo-Iranian Oil Company (AIOC), in 1935.
• and changed its name to the British Petroleum Company Limited
in 1954.
• In 1959, the company expanded beyond the Middle East to Alaska
A BRIEF HISTORY OF BP
1901
1909
1913
1935
1954
1959

4. • In 1965, it was the first company to strike oil in the North Sea.
• The name British Petroleum Company PLC was adopted in 1982.
• The British government privatised the company in stages
between 1979 and 1987.
• British Petroleum merged with Amoco in 1998, becoming BP
Amoco plc,
• acquired ARCO and Burmah Castrol in 2000, becoming BP plc in
2001.
A BRIEF HISTORY OF BP
1982
1965
1987
1998
2001

5. SWOT ANALYSIS
Strengths
• One of the biggest company in the energy
sector
• Wide geographic presence
• High quality operations
• Strong Brand Name
• Robust research and development initiatives
• Vertically integrated operations
Opportunities
• Increasing fuel/oil prices
• Increasing natural gas market
• More oil well discoveries
• Expand export market
• Investments in alternative energy business
Threats
• Government regulations
• Risks concerning environmental regulations
• Highly competitive industry
• Increasing Cost of Operations
Weaknesses
• Cost of environmental hazards
• Oil spill in the Gulf of Mexico
• Negative Public Perception
• Decline in production
S W
TO

6. PR MISFIRES OF BP
In responding to a question about BP’s safety record in an interview with ABC’s
George Stephanopoulos, BP CEO Tony Hayward said:
“I think we’ve made enormous strides as a company in the last three or four years
with a remorseless focus on safe, reliable operations. Ah, this wasn’t our
accident. This was a drilling rig operated by another company. It was their people,
their systems, their processes. We are responsible not for the accident but we are
responsible for the oil, dealing with it and cleaning the situation up.”

7. PR MISFIRES OF BP
12 epic mistakes that BP made from public relations perspective:
No 1:
The company should have had the billions of dollars worth of equipment, plans
and personnel working to prevent and if necessary to clean up the potential
ecological disasters.

8. PR MISFIRES OF BP
No 2:
CEO need to be hired for their leadership abilities so they have to be competent
communicators. If they work for a billion dollar coprporations they need to be
outstanding leaders and dazzling communicators.
 Needed a CEO not the best engineer!

9. PR MISFIRES OF BP
No 3:
Apr. 20: the day of explosion; The company did not have any adequately prepared
and practiced crisis communication plan. Even Andrew Gowers, BP head of group
media, told the NY Times, «It is not always easy to get your message across, the
media focus has been so intense it has been a challenge to respond as fully as we
would like on every issue.
 Strong need for a crisis plan that includes a communication component!

10. PR MISFIRES OF BP
No 4:
April 29: Tony Hayward, CEO, should not have said the things if you do want
something out of the news! «What the hell did we do to deserve this.»
 You should not speak of what should not be said in the first place!

11. PR MISFIRES OF BP
No 5:
May 3: Hayward said BP would clean up the oil but that they were not responsible
for the drilling rig and crew leased by BP. So, two character issues:
 First; arguments have to make sense!
 Second; accountability. You have to take responsibility for your actions!

12. PR MISFIRES OF BP
No 6:
May 14: Hayward said the Gulf of Mexico is a big ocean and characterized the
amount of oil pouring into it as tiny and insignificant…
 Do not bait your enemies! They will come back on you with more force and
intensity!

13. PR MISFIRES OF BP

14. PR MISFIRES OF BP
No 7:
May 17: BP began siphoning oil from the ruined riser pipe collecting 1000 barrels a
day. Hayward said they had turned the corner in dealing with the problem.
Siphoning solution was later abandoned.
 Do not give false hope!
 Think quickly and act slowly!

15. PR MISFIRES OF BP
No 8:
May 30: Hayward told the people of Louisiana that BP is sorry but then said that no
one wants this over more than he does and that he would like his life back.
Arrogance!
 Public relations staffs need to keep people like this under wraps!

16. PR MISFIRES OF BP
No 9:
June 3: BP started a 50 million TV campaign saying that they were sorry and that
they would make this right. Clean up every drop of oil and restore the shoreline to
its original state. The bigger issue is the ecological and economic disaster not the
public relations problem.
 Should not have spend this much on a communication campaign while the
commitment to funding economic and cleanup is still in doubt signals for BP
appearances are nore important than reality. Actions speaks louder than words!

17. PR MISFIRES OF BP
No 10:
June 8: BP chief Operating officer took the word saying that in a few days the spill
would be down to a trickle of only 10 to 35 barrels of oil a day. İnstead of him, a
higher ranking officer should have spoken…
 If things go bad CEO can steo in and repair the damage. When the CEO causes
the problem, the only solution is having the next highest ranking officer to
announce that the CEO has been dismissed and restart the dialogue on more
ethical grounds.

18. PR MISFIRES OF BP
No 11:
June 19: Hayward took part in an exclusive yachting race with his son off the cost
of the Isle of Wight. A BP spokesperson said he had not had a break since the spill
began and he was just spending a few hours with his family…What he did
symbolically alienated himself from the public. Instead he would have gone fishing
or boating…
 Marie Antonitte rule!

19. PR MISFIRES OF BP
No 12:
BP board Chairman Carl-Henric Svanberg publicly expressed his compassion for
the «small» people. Offensive because of the elitist context created by the yacht
race. BP staff explained that small people has a more positive connotation in
Svanberg’s native laguage. The response was too little too late…
 BP’s public relation efforts were reactive when they should have been
proactive…

20. PR MISFIRES OF BP
In summary;
 Every mining organization no matter how small should have one top executive
responsible for public relations.
 Should have a yearly responbility of assessing possible crisis scenarios and
preparing to deal with them.
 This can be managed by attending public relations workshops, reading the
public relations columns and stories in industry publications, by monitoring
public opinion and if necessary retaining public relations counsel.

21. BP COMMITMENTS FOR GULF COAST
BP Gulf Coast Update Our Ongoing
Commitment

22. BP COMMITMENTS FOR GULF COAST

23. KEY SOURCES OF ENERGY GROWTH

24. HOW THE ENERGY PRODUCES ECO-
FRIENDLY (ALASKA SAMPLE)
VİDEO-2

25. The BP EDUCATIONAL SERVICE
(BPES)