Tony Hayward BP CEO – Business is a pressure

Tony HaywardWhen Tony Hayward became BP's chief executive in 2007 he inherited the top position of a company reeling from 15 deaths and a further 170 injuries at a refinery in Texas and the ignominy of a fractured pipeline spoiling the natural balance of Alaska.  Hayward entered the role promising to “restore confidence” with sweeping changes.

 

In the wake of these tragedies – which now seem almost minor by comparison – both the Financial Times and Daily Telegraph reported Hayward’s critical view of BP’s management style.  Here was a dashing young candidate to succeed Lord Browne:

"We have a leadership style that is too directive and doesn't listen sufficiently well. The top of the organisation doesn't listen sufficiently to what the bottom is saying," he said.

 

"We have a management style that has made a virtue out of doing more for less. The mantra of more-for-less says that we can get 100 percent of the task completed with 90 percent of the resources. Which in some senses is okay and might work, but it needs to be deployed with great judgment and wisdom. When it isn't, you run into trouble.”

Prescient words, indeed. 

 

Looking through the cuttings library, it doesn’t get any better…

 

"It's easy to be a bit downbeat and downhearted if all you do is read the press in the US," he said at the time. "The reality is that there's an enormous amount of great stuff going on all over the place in BP. The firm's in great shape. The strategy is intact and delivering, and we continue to do great things."

Unfortunately, it’s a little late to put the genie back in the bottle. BP’s shares are down 45% and the brand is vilified across the USA and specifically in the eyes of its president.

 

The metaphor that it’s easier to turning a super tanker around than change the ingrained ways of a global oil conglomerate isn’t putting too fine a point on the situation.  The goodwill and excitement he showed in the early days of his tenure is absent today.  After all, who’d relish being declared public enemy No 1 in America?

 

Pensacola BeachRather than transform one of the world’s most powerful companies, Hayward has found himself in very deep water, demonised by the US media as being responsible for the world's worst environmental disaster.  And, let's not forget, the tragic deaths of 11 oil rig workers in the explosion that preceded the catastrophe.  Now, the man who briefed against his predecessor is getting a taste of his own medicine.

 

“Tony Hayward looks like a dead chief executive walking,” wrote the BBC’s Business Editor, Robert Peston on June 20th – 64 days after the original incident.

“Having spoken to those at the top of BP, none can come up with a scenario in which Mr Hayward stays at the helm of the bedraggled oil company longer than the proper capping of the leaking well and some kind of quantification of the financial damage.”

 

Professor Stephen Brammer, who lectures on corporate reputation at Bath University offers advice for the beleaguered BP CEO:  "Say you are sorry as quickly as you can and tell the world what you are doing to put things right," he says.  “It shows that the company [is] putting the public above profit."

 

Unfortunately, it’s a little late to put the genie back in the bottle.  BP’s shares are down 45% and the brand is vilified across the USA and specifically in the eyes of its president.

 

However, Peston – a man with near-telepathic insight into financial dealings – believes Hayward won’t get the elbow just yet.  Instead, the wayward CEO may find himself in some sort of corporate limbo.

 

Rehabilitation is impossible without a change of leadership, Peston acknowledges but “right now Mr Hayward is performing an incredibly valuable service to BP.  He is absorbing most of the opprobrium heaped on BP by the White House, Congress, the media, and Gulf Coast residents”.

 

“The danger of replacing him now is that his successor would quickly be tainted – and could then become a lame duck rather than a new start.”

 

Groundhog day then for the company and its boss…