I believe that BP is pretty much, well, toast. Does that mean that they are out of business tomorrow? No it does not. They may in fact be operating as an entity called BP for some time to come, and for legal reasons, others that are interested in assets of the company probably would want to purchase the assets and leave the corporate shell alone. That said, they have lost the most precious asset a corporation could ever attain -- the trust, respect and confidence of customers, investors and the body politic. Further, they have lost the respect and trust of their brand. And such a shame, as even I had begun to buy into their amazing television commercial campaign of late 2009. Too bad the company did not put as much attention into protecting its brand as it did promoting it.
And so, like the shadow following you as you walk down the street, BP may be with us for a while, managing through endless private and government led lawsuits and such, but as a growing global brand the company is effectively a dead man walking.
I speak about this directly in my now bestselling business book, LOVE LEADERSHIP: The New Way to Live in a Fear-Based World (Jossey-Bass). In Love Leadership I speak to the disease of 'short-termism' and of taking ethical short cuts to profits in business. It seems like wherever you turn, people are asking "How do I get paid?" whether it be the rap star, professional athlete, doctor, lawyer, Wall Street banker, pimp on the street corner or heck, even the executives at a global powerhouse such as BP.
Now, let me be clear that I am not taking shots, making accusations or calling names here, or even criticizing the leadership of BP, per se. I am simply saying, "Over there is a chair." Or put another way, "I am simply calling it, what it is."
The simple fact is the disaster in the gulf represents the 100% failure of management to "get" its true value proposition, and more so, to understand how to protect its ultimate long-term value as a company.
In BP's business, safety should simply come first. Not for moral or ethical reasons, although morality and ethics should always be in the conversation. But simply this -- it only takes one crisis like this, one mistake or misstep of safety of the public good, and your brand is toast.
And so it is fascinating to hear workers from BP note how the company talked safety, but walked a reality of short-term profitability over all else. Maybe at any cost. They cut corners needlessly, as the company wasn't broke or without resources, and ultimately shot themselves in the foot, or worse.
Nothing should have been more important at a company like BP than safety. Investing in safety first, second, third, fourth through 35th priority should not have been viewed within the leadership as extra, but essential. It is what protects all the value and profitability company leaders, employees and even independent service station franchisers, have built over all these years. In short, build long-term wealth by taking care of short-term safety concerns, and treat the people and communities you serve as long-term relationships and not merely transactions to profitability. What an insurance policy to true wealth building -- and legacy too.
In Love Leadership, I speak to how crisis reveals leadership qualities, and from crisis leaders often emerge. This is covered in the first chapter, entitled "Loss Creates Leaders". Here unfortunately, BP has failed again. Their "response" has been, well, horrible. Ready, fire, aim.
I often say that "leadership is the science of what you say in stable circumstances, but the art of what you do under un-mitigating, intense pressure and untimed stress. In short, if you fail to deliver on the front end you can still save your bacon, so to speak, on the back end of your "response" to crisis; the place where leaders are made. Once again, BP has come up short.
And so, this leaves well, not much.
I predict that within a couple years the substantial assets of BP will be acquired or otherwise "re-purposed," and that for the foreseeable future most of BP's corporate time will be tied up in responding to crisis, threat and lawsuit, and not trying to discover the next big "oh yea" idea or opportunity in the energy sector. This, in and of itself, spells a disaster of another kind.
I am beginning to believe that karma is real.
John Hope Bryant is an entrepreneur, the founder, chairman and CEO of Operation HOPE, former vice chairman, U.S. President's Advisory Council on Financial Literacy, financial literacy advisor to the World Economic Forum Global Agenda Council, a Young Global Leaders for the World Economic Forum, internationally recognized public speaker and author of LOVE LEADERSHIP; A New Way to Lead in a Fear-Based World (Jossey-Bass), which debuted in August, 2009, as the Amazon.com #1 Hottest New Book (for Leadership), on the CEO Reads Top 10 Business Best Seller List, and was published in November, 2009 in digital audio book format on Audible.com, iTunes and other audio book retailers . Love Leadership was listed amongst the Top 25 Business Books for Inc. Magazine/CEO Read for 9 month after its release.
Follow John Hope Bryant on Twitter: www.twitter.com/johnhopebryant
Dan Dorfman: SEC Investigating BP Trading
Tack on a new and unreported dimension to British Petroleum's catastrophic oil spill in the Gulf of Mexico, a recently initiated investigation by the Securities and Exchange Commission into the trading in BP shares.
Rip Empson: An Open Letter from BP[Updated]
You have to remember: it's really, really super hard to be a big public corporation! Like it or not, image is everything. We Photoshop in the name of those we care about!
http://www.youtube.com/watch?v=DwX9RXFRJD4&feature=player_embedded
Full disclosure: I am short on BP', ADRs.
Don't worry, if you were naive enough to be fooled by those dumb commercials, they will be able to fool you again in the near future, they are already working on some positive feelgood music and brighteyed, smiling kids to do it.
If this is the argument, it is time to invest all I have in BP. This is a joke. No one buying gas will remember this in 6 months when filling up, investors are looking for a good return not good philanthropy. I am not sure what the body politic is, but who cares.
I am not sure you understand how they make their money, the discover, extract, process and distribute a commodity that is in demand, a lot of it to sophisticated, indistrial customers. It is not from selling twinkies, car washes and gas down the street from you.
I don't think the analogy of Lehman and Countrywide makes sense. They had illiquid and insolvent portfolio odf assets. When nobody wants oil, BP will go the same route. It is now only a question of $20 billion or $60 billion of liability, no more and no less. They aren't toast, at all, you have to be naive to think so.