BP: Big problems for Hayward

Things aren’t exactly looking bright at BP. After a torrid couple of years for Britain’s Biggest Company™, it looks like its management is set to get it in the neck. New chief exec Tony Hayward is now promising massive restructuring, after revealing that its third-quarter results, published in October, will be ‘dreadful’.

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Last Updated: 31 Aug 2010
Indeed, the results are set to highlight the energy giant’s worst financial performance for 15 years. And this at a time of record oil prices. It’s hardly what BP needs, especially after the refinery explosion in Texas in 2005 that left 15 dead, large oil spills in Alaska the following year, and the accusations that BP had tried to rig the petrol market. Not to mention the high-profile departure of longstanding figurehead Lord Browne, who gave up his leadership in May after lying in court to cover up details of his gay relationship.

So what is Hayward’s solution? Primarily it’s to cut out the deadwood from BP’s overcomplicated management structure – improving clarity between roles, in terms of who’s supposed to be doing what, and empowering people to assume autonomy and take risks. It’s certainly a good start, and quite handy for Hayward, as the sweeping changes will allow him to imply that things had gone rather awry under Browne, and that he’s the man to sort it out. Much better than trying to follow in the footsteps of such an esteemed leader. 

Next up will be to get production up to speed at its US plants, and perhaps patching up the company’s flailing reputation on that side of the Atlantic. Then there are BP’s slow-moving projects in the Gulf of Mexico. After that he just has to find a truly viable and sustainable alternative to fossil fuels and he’ll have earned a holiday.

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