BP Control Functions
Incontestably control mechanisms have existed within most businesses and organizations for guiding job responsibilities of employees toward accomplishing the company goals. There are many control mechanisms in a company. A strong human resources department controls managers and prevents employee abuse. Employee performance reviews and incentives assist in the control of employees. Compliance departments control legal risk and monitor operations to ensure the company follows state and federal rules. Financial budgets and accounting audits control financial risk. Product pricing controls marketing efforts. All the different departments must work together to create a strong and profitable company. The team will identify various control mechanisms in connection with British Protroleum (BP), compare, and contrast, determine the effectiveness, examine positive and negative reactions concerning their use, and provide an explanation about how the four functions of management are affected by them.
BP used several control functions in its deep sea exploration process; all implemented to prevent the type of disaster they experienced in April 2010. There were systematic failures at every turn, creating a perfect storm and a devastating deep sea oil spill. The spill itself has been recorded as the largest oil spill to date in American history by the National Oceanic and Atmospheric Administration (Zeller, 2010). According to the same article, the BP spill was nearly triple the volume of that which was experienced in the Exxon Valdez spill 21 years earlier.
Several of the control systems that were in place that day were: the cement that was meant to seal the reservoir from the well, the casing system that was to seal the well bore, pressure tests that should have confirmed the well was sealed, and the procedures that were used to detect and to control the hydrocarbons in the well, which included the use of the Blow Out Preventer (BOP) (BP, 2010). There were three additional controls used, for a total of seven, all of which failed.
With such a large number of controls that failed, a major catastrophe occurred affecting many people. When such a catastrophe occurs, it is only natural for people to want a specific event or precise mechanical failure to pinpoint as the cause of an incident, especially one as environmentally impactful as this deep sea spill was (BP, 2010). However in this case, there was no single event to blame. It would be more appropriate to simply state that it was a systematic failure of management to control the processes that should have been in place which in the end, caused the largest spill in American history. After investigating each control method individually, each method would have changes made so this type of disaster did not occur again.
Deep Water Horizon, built by Transocean and leased to BP was an engineering marvel. The ships capabilities allowed its users to drill for oil in areas previously unreachable. After drilling into the ocean floor and the bedrock below, casing systems are lowered by the ship to form a protective barrier around the drilling area. A cross section of the well would resemble a medium size ring inserted into a large size ring, with the large ring representing the casing, and the medium ring representing the well where the hydrocarbons or mixture of oil, natural gas, water, and other substances would travel to the surface. The area in between the medium and large rings is known as the “annalus”. This voided space is filled with modified cement to ensure the stability of the well. Upon completion of the well and casings, a battery of tests to determine strength and stability are applied. If the tests are successful, then the operator may begin to pump oil from the well through the blow-out preventer or BOP. The multiple layered safety approach to drilling has been commonly accepted industry practice for decades.
A control mechanism that was successful at the Macondo well was the casing. The nearly ten inch casing installed by the crew of the Deepwater Horizon successfully held the pressure back from the rock formation as the ship continued to drill into the earth. At one point during the expedition, drilling mud fractured the rock formation. Engineers quickly “plugged” the unstable area and continued to drill and install the sturdy pipe casing.
The first control function to fail was the concrete between the well and casing. The use of a third party of experts to fill the annulus of the well with cement was meant to be a control function. This third party was Halliburton, an oil field services company. Halliburton engineers were to analyze the casing and ensure the correct concrete formula would be used to fill the annulus. “Since the well was deemed to be economically worthwhile, BP began preparing the well for production by lowering production casings and centralizers into the well. Then, Haliburton’s crew attempted to isolate the hydrocarbons at the bottom of the well by pumping cement into the space between the casing and the well bore (annulus). Although several design changes, equipment malfunctions, and anomalous pressure readings occurred, BP and Haliburton declared the operation a success on April 20” (Rose & Hunt, 2012).
The second control function to fail was the testing of the well that was to be completed. “In preparation to move the Deepwater Horizon to its next drilling operation, the crew conducted a series of procedures to assess the integrity of the cement and then plug the well. While conducting these procedures, mud, seawater, and natural gas erupted onto the rig” (Rose & Hunt, 2012). According to BP’s Deepwater Horizon Accident Investigation in 2010, “The negative-pressure test was accepted although well integrity had not been established”(BP, 2010). This failure to ensure the integrity of the line by Halliburton and BP employees had a direct and deadly impact on the ill-fated ship.
A third control mechanism to fail was the blow-out preventer. This 53 foot, 450 ton “cap” is what connects the drilling and extraction units to the liquid gold beneath the ocean floor. “A BOP is a hydraulically-powered emergency safety device designed to shear off the pipe and prevent the escape of hydrocarbons from the well. All drilling equipment -- the rotary drill bit, pipe, casing, and mud -- pass through the BOP into the well” ( Rose & Hunt, 2012). When the catastrophe occurred, a portion of the casing collapsed and prevented the blow-out preventer from sheering the pipe and sealing the well causing even more trouble. When a company is being attacked by failures such as these, it is hard to see any positive outcomes, especially after the destruction it has caused. However, after reviewing the investigation reports and analyzing each step that was taken, many positives events took place. While working with other companies, the government, and the military to stop the oil flow from spilling into the ocean, success was landed on July 15th (A Safer, Stronger BP, 2012). This success was due to the technology used, remotely-operated vehicles that are basically robotic submarines to put a cap stacking in place. According to Dudley,” this was a remarkable engineering feat. It required hitting a target the size of a dinner plate, 3 ½ miles below the water’s surface in the dark” (A Safer, Stronger BP, 2012). While BP compared their investigation with the government investigation, BP found continued to find more positive that came to light.
BP decided that because of their failure in the operations control, they had to reinforce their safety and risk management globally. Bp formed a new organization that includes hundreds of experts that are deployed within their operating area. These experts are to help guide, advise, and if necessary intervene (A Safer, Stronger BP, 2012). At the advice of some of these experts BP has shut down some platforms to make adjustments. BP has also rejected several rigs that failed the new enhanced safety requirements. Thanks to the new safety organization, the same engineers who capped the Macondo well have designed and built another containment cap that can be deploy worldwide if necessary (A Safer, Stronger BP, 2012). BP has also shared all pertinent information learned from this incident with other companies to help prevent another catastrophe from any company anywhere.
Also in response to BP’s failed operations control, BP’s group chief executive, Robert W. Dudley, has also visited some of BP’s oldest refineries to ensure that these refineries are not antiquated. While visiting the Whiting refinery, Dudley felt that the refinery needed updating to be able to handle the heavier crudes. Dudley’s order will cost billions of dollars to modernize the refinery (A Safer, Stronger BP, 2012). Control and planning are interrelated so closely that they cannot be separated from each other. Without control all the planning is fruitless because control consists of the steps taken to ensure that the performance of the organization conforms to the plans. Control is a fundamental management function that ensures work accomplishment according to plans. The purpose of control is to ensure that everything in an organization occurs in conformity with pre-determined plans. Control also ensures that there is no kind of indiscipline and incompetence in the organization and employees are not able to put undue pressure on the management.
In final analysis, the four control mechanisms among others used by British Petroleum identified, proves that if the appropriate controls aren’t first planned and then implemented, the result can be fiscally damaging for the business and in the case of BP, environmentally hazardous and catastrophic. In the aftermath of this grave injustice to a beautiful coastline, BP learned a very expensive lesson, if you fail to plan, you plan to fail.

References
A Safer, Stronger BP. (2012). Vital Speeches of the Day, 78(3), 93.
BP. (May 25, 2010). BP Briefs US Government on Initial Perspective of Deepwater Horizon Investigation - Focus is on Seven Control Mechanisms. Retrieved from http://www.bp.com/genericarticle.do?categoryId=2012968&contentId=7062374
BP. (2010, September 8). Deepwater horizon accident investigation report. Retrieved from http://www.bp.com/liveassets/bp_internet/globalbp/globalbp_uk_english/gom_response/STAGING/local_assets/downloads_pdfs/Deepwater_Horizon_Accident_Investigation_Report_Executive_summary.pdf
Mary Annette Rose & Brian Hunt, (2012, February). Learning from engineering failures: A case study of the deepwater horizon. technology and engineering teacher, 71(5), 5-11.
Zeller Jr, T. (May 27, 2010). Estimates Suggest Spill Is Biggest in U.S. History. Retrieved from http://www.nytimes.com/2010/05/28/us/28flow.html