Developing a Critical View of the Leadership and Coaching Literature - Essay Example

BP & the Gulf of Mexico oil spill: Developing a Critical View of The Leadership and Coaching Literature as Preparation for Coaching Practice Introduction The role of leaders in management of crisis is a crucial one. The essence of corporate crisis planning lies in the removal of uncertainty from the decision making process and exercising greater control over the organization during distress (Gohlke, et al., 2011). During times of leadership crisis leaders have the responsibility to understand the magnitude of the crisis and help the organization to come out of it by exercising his management abilities. Effective crisis management does not comprise following the rules set by others, it requires robust discretion and creative decision making on the part of the leaders to ensure that the organization can come out of the crisis (Rego, Pina E Cunha and Clegg, 2012). The purpose of this paper is to discuss the organization crisis and evaluate the critical role of management in the British Petroleum oil spill at Gulf of Mexico. This event has been considered to be one of the most powerful events that have had profound negative impact on the ecological environment in the history of North America. The nature of the accident itself and the crisis management of the company can be treated as a classic case of ineffective leadership in crisis management. Accountability Issues The BP Oil Explosion tragedy that took place in Texas had caused severe damages to the environment and posed threats to health and safety of human beings. The oil spill in deep water over the ocean and also the shores have also had a critical impact on the ecology of the region and also the environment in general (Corkindale, 2011). The post spill initiative like burning of oil and water mixtures and leak of hazardous materials might have a tremendous impact on the atmosphere as well. The explosion also causes deaths of 5 employees leaving more than 170 deeply injured (McNulty, 2010). This reflects a highly unsafe environment for the workers which are combined with the insufficiency of knowledge about the safety conditions and information. As per my belief, I would say that employees at BP had not been treated evenly and the ones which have been unfairly treated for the safety norms were those who worked at high exposures of petroleum and chemicals. Additionally, workers lacked in training for safety of their health conditions. In a hazardous situation, the workers are not aware of the ways in which they can protect their lives. Additionally, the Occupational Safety and Health Administration the corporation’s safety terms can be supervised. However, the OSHA organization did not supervise the health and safety standards for the oil rig worker. Worker at the oil rig also has concerns regarding being protected by the labour laws (Hoffman and Jennings, 2011). The company also does not have a mechanism to protect the human rights. For the retiree who depends largely on BP shares for his income, BP has a responsibility that needs to protect the interests of its shareholders and investors. BP had delayed all the essential expenditures that were necessary for the business and was therefore unfaithful towards proper dissemination of correct information to its shareholders (Hays, 2010). The company also extracted cash and squeezed the assets that were shrinking for higher amounts of cash so as to reflect higher liquidity in financial statements and thereby attract higher investments. Such cash squeezing was supported by an immense and a strong measure for cutting costs (Bryant and Hunter, 2010). The financial management of the company still popularised that they were making huge profits and generating a strong business cycle. Such again reflects misguidance on the part of the company defying its responsibility towards the investors who are in major threat. This is because a company that avoids expenses and runs on instability of assets and cash positions cannot imbibe the trust of investors for long (Freudenburg and Gramling, 2011). In addition to the above course of events, BP also cancelled its security budget for the purpose of gaining higher benefits from the business. As it stands, the security budget was later run on a pressured budget and use of cheap equipments for the safety of its employees. It was the policy of BP to squeeze as much cash as possible and thereby make the foundations of the company very weak (Kurtz, 2004). Leadership Issues The use of media and the professional in the field of PR management y BP was a huge mistake to spin down its way out of the crisis situation and avoid criticisms that came in its way. Leaders are expected to face the problems head on while Tony Haywood preferred to avoid it (Jackson and Parry, 2011). This created an untold damage to the reputation shared by BP. The leader reflected his inability to comprehend reactions from the public within his PR schemes and also appeared defensive in approach while losing out the grip of the situation. A clear comparison might be developed between the recent banking crisis and the Gulf of Mexico oil spill. In both these cases the risk management was hidden under innovation, gaining higher profits and responding to the demand of the market. Here, one can see that the company gained enough support in the initial stages from the investors who viewed strategic attempts of the company to be lucrative and expected high yields out of their plan. However, the risk management factor tended to be overlooked. Also, there was a conflict of interest that arouse between the shareholders of the company and the employees. It became critical in areas of cost cutting where the retaliations of the employees went unheard and the company adopted relentless cost cutting measures being backed by their shareholders. Hence it can be said that instead of working together, leaders of different representative groups of the company worked for scoring higher points and deflecting blames. The organisational culture was truly dysfunctional in the case of BP where the leadership of the company ignored expert advice, risk taking, safety issues and also hid critical facts displaying culpability and reprehensibility of the organizational leaders. The flaw within organizational culture was also seen in the late response to the crisis. Leadership Changes Required The attitudes and the behaviours of the people during the Gulf of Mexico crisis were not only disappointing but reflected upon the irresponsibility of the leadership to the worst possible situation. Some of the very basic and critical elements of the leadership roles appear to have been flouted in these cases. The style of leadership for Hayward, the CEO of the company cam through as an impressive one when he identified that British Petroleum or BP was a typical organization that ran on direct and control mechanisms. Yet, he planned to convert the style of leadership from a transactional format to a transformation leadership format through cost cutting measure sand strong approach to problems. However, after the oil spill in 2010, Hayward, the one in change and responsible for company operations with a leadership style that was contrary to the one that had been generally followed at BP, quickly shifted to a resilient leadership style to save his accountability and public position. The paper shall identify four critical issues of management that need to be addressed within the leadership of BP in order to make an attempt towards restoring the earlier position of the oil and petroleum giant. The first stage of the management change involves a change in the expectations that have been developed among the public (Cottrell, 2011). In an attempt towards developing the corporate image of the company to a one where BP is seen as a responsible corporate citizen and that disseminates correct information to the public, the company needs to develop a participative form of leadership so as to allow highest degree of representation within their management and also imbibe a sense of transparency and accountability in the decision making process. The democratic or the participative form of leadership has a leader who works only after due discussion with the concerned parties and the affected stakeholders of the company (Yukl, 1989). Such decisions are a representation of the group agreements and imbibe greater trust among the stakeholders. Additionally, they are also more successful because there is less resistance faced in the process of execution of decisions undertaken under the democratic form of leadership (Heller, 2012). This is believed to be in start contract to the transformational leadership pattern followed by Hayward. Here, the participation allows for greater degree of motivation to work among the employees because they feel involved with the decision making process and instil a sense of ownership in the work (Gardner, 2004). Secondly, the company needs to work towards its corporate social responsibility whereby it has to introduce higher participation in social initiatives to gather a positive corporate image. Here, the organization has to take up decisions that pertain to allowing for a greater public participation (Jackson and Parry, 2011). This might not be seen positively by the shareholder who views it as an additional cost that does not bear profits. However, the leaders of the company have to adopt autocratic styles in these decisions knowing that it shall work in the best interests of the company and help it retain competitive advantage over its key competitors. These leaders also have to work towards explaining to the shareholders about the importance of socially responsible roles. Thirdly, the leadership at BP has to develop an effective role definition system whereby each person in the organization is well aware of \his or her role. However, such role definition also needs to be followed up by the system for monitoring and checking for deviations bringing them to focus The leadership in the company also needs to establish mechanisms which give more power to the employees and the shareholders for whistle blowing. Employees must be encouraged for whistle blowing for bringing wrong practices to the forefront. This also needs to be backed up by a proper system to protect the confidentiality of whistle blower and also allowing for high level security measures to such employees (Bolman and Deal, 2008). The leadership role that shall be critical here is again the participative form of leadership where the employees are encouraged to participate in the monitoring process. Conclusion The crisis management techniques of British Petroleum were incompetent at multiple levels. Firstly, it must be mentioned that preventive actions could have been taken by the organization that could have prevented the event in the first place. Secondly, in the aftermath of the crisis the management had behaved arrogantly that had aggravated the mistrust for the company by the public. Organizational culture of the company was crowded by corporate greed and an attempt to gain support of the shareholders had created formidable dissatisfaction among the employees. Based on the crisis it can be recommended that the leadership should make its decision-making process transparent and involve the employees in them. It is also recommended that the leaders must take a stronger stance about the corporate social responsibility of the company even if these efforts are resisted by shareholders. The leaders must reason with the shareholders and explain them about the benefits that could be obtained from being socially responsible. Finally, greater effort must be provided by the company to encourage policies of whistle blowing in the organization and employees who do the same must be protected from any potential harm. Reference List Bolman, L. and Deal, T., 2008. Reframing Organizations: artistry, choice, and leadership. San Francisco. California: John Wiley & Sons, Inc Bryant, M. and Hunter, T., 2010. BP and public issues (mis) management. [pdf] IVY Business Journal. Available at: [Accessed 30 August 2014]. Corkindale, G., 2011. Five Leadership Lessons from the BP Oil Spill. [online] Available at: [Accessed 26 August 2014]. Cottrell, S. 2011. 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