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British Petroleum (PLC) and John Browne: A Culture of Risk Beyond Petroleum

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British Petroleum (BP) reputation was put to the test in 2005 when a major explosion at one of the refineries in Texas exploded killing 15 people and injuring more than 180. Investigations returned a history of poorly regulated safety measures and facilities’ safety compromised in favor of profits, cost savings, and lack of supervised management. Two years later, Lord John Browne announces an early retirement before a successor is prepared to assume the position. The company new culture risk reduced shareholder’s confidence, risked lives and the firm’s reputation (Hunter, 2012). A workshop must be coordinated to identify and assess risks the company is facing. Risk Management Workshop Agenda

| Monday, February 11, 2013|
8:00-8:15am| General Housekeeping|
8:15-8:30| Introductions|
8:30-9:00| Project Objectives|
9:00-9:30| Scope of Risk Process|
9:30-9:45| Morning Break|
9:45-10:30| Ground Rules|
10:30-11:00 | Risk Management Briefing|
11:00-11:30 | Expectations and Results|
11:30-12:00| Identify Risks (Brainstorming Session)|
12:00-1:00| Lunch|
1:00-2:00| Rationalize Risks|
2:00-3:30| Risk Mentalanguage|
3:30-3:45| Afternoon Break|
3:45-5:00| Identified Risks Recording|

| Tuesday, February 12, 2013|
8:00-8:15 am| General Housekeeping|
8:15-9:00 | Assessment Scheme Recap|
9:00-10:00| Probability and Impact Assessment|
10:00-10:15 | Morning Break|
10:15-12:00| Risk Categorization|
12:00-1:00 pm| Lunch|
1:00-3:00 | Q&A|
3:00-3:30 | Close Workshop |

Day One of the workshop will begin with a few general housekeeping issues. It’s important to set the scene of the workshop’s expectations. The risk champion will begin the workshop by having all of the key stakeholders to introduce themselves and answer specific questions regarding their name, role, experience, expectations, fear of the project, and what safety measures could benefit the project. This will save time during the workshop (Hillson & Simon, 1995).

Next, the project’s objectives will be defined. The objective is to restore confidence in shareholders and the company’s reputation and implement new safety measures to avoid future injuries and fatalities under new leadership. By confirming the project’s objectives, it removes any misunderstandings and defines a clear understanding of the importance of the objectives (Hillson & Simon, 1995).

The Risk Management Plan needs to be reviewed. Here the objectives are in scope and boundaries are discussed with workshop participants will be asked to identify risks. The explosion at the Texas facility was not the first accident, but was the worst. There was an average of one fire per week and 23 fatalities in the previous 30 years (Hunter, 2012).

In order to ensure the success of the workshop, all participants will need to understand the ground rules and accept them. The agenda has a purpose. All topics need to be followed and the timing schedule needs to be adhered. It’s important for all participants to speak and respect others when they are speaking. All participants will all the facilitator to speak on processes (Hillson & Simon, 1995).

Since this workshop is about the risks identified at BP, new participants may not be familiar with some of the aspects of project risk management. It is important to define risk and risk management, the ATOM risk management process (Initiation, Identification, Assessment, Response Planning, Reporting, Implementation, and Reviews). The workshop’s purpose is to assess risks as well. Risks must be prioritized and a risk owner must be identified (Hillson & Simon, 1995). In 2004, Don Parus the facility’s director hired a consulting firm to perform a safety culture of the facility. Evidence of safety issues were identified such as broken alarms, falling concrete, injuries and safety violations. Management acknowledged the safety issues, showed interest in the beginning, but profit took priority (Hunter, 2012). No one assumed ownership of the risks identified. So it was important to discuss the Risk Management Plan. Expectations and results will be clarified by the risk champion. It will include outputs and actions from the workshop participants.

Brainstorming is the one of the most important aspects of the workshop. It is where the risk champion will emphasize the ground rules of the workshop. It’s important to know that criticism is not allowed. Since it’s brainstorming, the more ideas, the better the chances of coming up with a great idea. Participants should be able to build and play off of each other’s ideas while encouraging one another (Hillson & Simon, 1995). Someone should be identified to record the risks identified during brainstorming. Most groups use flip charts. Based on the report Parus ordered in 2004, management addressed issues and then lost focused. Risk ownership, risk assumptions, and constraints must be identified and listed. The validity of each must be identified. The standard risk checklist should be used to conclude any additional risks that had not been discussed. Risk will need to be analyzed. What were the cause of the explosions? Why was concrete falling? Why were there so many safety violations (Hunter, 2012)?

As the workshop starts to wrap up, risks need to be structured and separated into cause, risk, and effect. For example, as a result of limited resources, broken alarms, numerous safety violations, a higher risk of fatalities and injuries may occur. As a result of numerous safety violations identified through investigative reports, shareholders could lose confidence in BP. As a result lack of safety measures and risk ownership, numerous safety violations could occur that could lead to law suits and other liabilities which would affect BP’s profit for the year. To conclude the workshop, risks are recorded, duplicates are deleted. Descriptions of risks using the mentalanguage are to be recorded. There is a possibility that these risks could be recorded directly into the risk tool. The Identification step has been completed in the workshop. The following day will be the Assessment part. The Assessment part purpose is to prioritize risks, identify low priority risks, assign owners, and risk exposure for BP (Hillson & Simon, 1995).

Works Cited

Hillson, D., & Simon, P. (1995). Practical Project Risk Management: The Atom Methodology. Vienna: Management Concepts, Inc. Hunter, T. (2012). British Petroleum (PLC) and John Browne: A Culture of Risk Beyond Petroleum. In BUS 519 Project Risk Management (pp. 13-25). Virginia Beach: XanEdu Publishing, Inc.

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