Due Week 6 and worth 200 points Note: The assignments are a series of papers that are based on the same case, which is located in the XanEdu tab in the course shell. The assignments depend on one anot
Running head: assess organizational readiness 0
Introduction
The leadership of an organization mainly consists of different elements and the most promising element is “Operational excellence”. It enables the leadership to apply the principles, run the system, and use the tools in such a way that leads the organization to sustainable improvements (Shaw & Zabudsky, 2013). Many ups and downs have been coming in the Oil & Gas industry; however, the industry has coped up with these ups and downs appropriately. It is natural when there is prosperity, there is an increase in spending; essentially, organizations spend their earnings on different business-related elements such as the hiring of new employees, research and development, purchasing new plant & equipment, etc. Sometimes, such spending may cause a devaluation of current assets’ performance. The period of recession never brings prosperity and growth for the organizations consequently they have to reduce their expenses, restrict the project’s completion, and defer important investments; all efforts are done just for the survival of the organization. Again these actions affect the performance of assets in the long-run. Mostly, organizations with the help of increased sales expect to have a rise in their revenue; that is why large companies, multinational groups, and corporations are in the position to enjoy competitive business advantages. The success of a business directly depends upon the fundamental components that require the management team to manage the operations of the business keenly and wisely. There are some particular factors including the culture of the firm, technology, and economic and environmental risks that play a decisive role in the profit generation process of the firm even these factors decide how much profit the firm would be able to earn in the coming days. The assignment will analyze the case study of British Petroleum (BP) and the John Browne Company. In this paper, the critical success factor (CSF) will be discussed that plays an important role in growing the business operations of a company. The assignment will use CSF for determining the benefits that BP enjoys including organizational readiness and the organization’s risk culture. In this paper, the recommendation of three project risks will be proposed along with the justification and identification of initial categories of risk such as (RBS Level 1 and 2) will also be part of this assignment.
Evaluating the Critical Success Factors (CSF)
The projects, programs, or organizations that are directly influenced by the variables, conditions, situations, or characteristics impacting potentially on the efficiency, effectiveness and viability of the same is known as Critical Success Factors (CSF). There must be the highest level of excellence in performing CSF activities that can ensure the attainment of the best possible objectives (Sim, 2008). There are many cases reported about the failure of projects where the organizations either did not pay proper attention to CSF or partially involved these for the completion of their project. Essentially, there is a direct relationship between CSF and the mission, vision, and objectives of the organization because the role of CSF in meeting the same is quite critical. Some of the types of critical success factors (CSF) include supportive organization, competent people, appropriate methods, tools and techniques, and simple, scalable process (Shaw & Zabudsky, 2013). A supportive organization refers to the company’s clear objectives for managing risk. Competent people mean a shared understanding of principles and concepts for managing risk. The type appropriate methods, tools, and techniques refer to software and infrastructure required for implementing the process appropriately. A simple, scalable process means recognizing that there is no universal approach at all to manage all the processes.
The case study reveals some critical success factors (CSF) including diversification, company management under CEO John Browne, and corporate social responsibility. Regarding diversification in British Petroleum, it means splitting the company into three segments. The use of technology is the first segment exploring and producing oil. The segment helped the company to operate in 26 countries worldwide for drilling and producing oil & gas. Exploration of new reserves is the second segment the company keenly focuses since it has been spending billions of dollars on finding new reserves; some of the subsections of this segment include refining and converting process. The third segment of British Petroleum (BP) under diversification includes distribution channels of the company’s value chain. Some components such as power, gas, and oil have contributed to the growth and success of the company.
The company’s management under CEO John Browne is the second critical success factor that BP enjoyed successfully. The contribution of John Browne as the CEO is exceptional since the current standing of the company is just because of the efforts, loyalty, and leadership of Mr. Browne. The company believes in environmental safety including employee’s code of ethics and that is the reason, the company keenly follows standards ensuring environmental safety. The third critical success factor of BP is its corporate social responsibility that is again just because of CEO John Browne. The CSR policy of British Petroleum keeps covering various components such as environment, health, and safety of employees, community safety, and compliance. The company equally takes care of the rights, concerns, and expectations of its customers and the local community. The critical success factors (CSF) of British Petroleum have been contributing to the growth and success of the company making the company one of the pioneer in the field of Oil & Gas.
Project benefits, Organizational readiness, and risk Culture of the Company
Organizations apart from growing and progressing may face critical challenges in continuing their business operations; these challenges can be manpower, resources, regulations, competition, safety, etc. (Hillson & Simon, 2014). In the recent past, despite various vigorous achievements the British Petroleum Company (BP) has experienced many critical challenges bringing several downfalls to the company. Safety is one of the main challenges that have caused BP to undergo several consequences. For example, the refinery explosion of 2005 took away the lives of many individuals raising a question mark on the safety and hazard protocols being practiced by the company. The explosion not only took the lives of many employees but also left a large number of employees injured and bereaved from precious organs. The company believes that the incident was one of the most damaging incidents in the history of BP killing 15 people and causing injury to more than 180 people. Consequently, the company failed in investing in the culture of safety-risk receiving ever-worst remarks from the general public and other environmental protection agencies. The precautions taken by the company for the protection of the environment and employees seem to be weak yet inadequate requiring additional time, efforts, and execution of change policy. Reportedly, there were various safety matters and measures which were deliberately comprised causing such an unpleasant incident.
For an organization, the safety of employees, community, and environment is equally essential and it must create a safety culture to grow as a socially responsible company. The safety culture within the organization is indispensable for attracting more qualified, skilled, and experienced staff (Hillson & Simon, 2014). Organizations must have and ensure that sustainable policy does exist on the ground practically. BP Company has some projects in pipe-line investing additionally relating to the generation of hydropower through renewable energy, gas, etc.
The appointment of John Browne as the CEO of the company has changed the culture of the company. The case study reveals that Mr. Browne has not only a charismatic personality but he has the courage and leadership attributes to take the company to the pinnacle of success and growth. The new CEO has successfully ensured the vision of the company achieving excellence in the production of oil and gas.
The safety of the environment and employees is equally important since it can potentially make or break the organization. Individuals who are assured that their employer pays attention to the protection of the environment and community would prefer to work for that organization and vice versa. The recent resignation of John Browne from the CEO ship will certainly create some future challenges for the company since the transition phase will lead to a leadership gap. The production and progress both will suffer in the absence of Mr. Browne since his vision and leadership qualities remained dominated for recognizing the company worldwide.
Project risk recommendations
According to the case study, the company could not manage to protect the safety of its employees as well as the environment. It is essential to mention that the sound knowledge, political will, and commitment to ensure safety and protection could stop such an explosion to happen that caused the death and injury of employees. The following recommendations should be followed by the company to strengthen the existing safety protocols and avoid such types of happenings in the future.
The policy on environmental protection should be revised thoroughly. It is important that such a policy should be created which ensures the safety of both employees and the environment (Hillson & Simon, 2014)
There must be a proper detection system monitoring all the activities within and outside the plant (Hillson & Simon, 2014). There must be an installation of a concrete information system enabling all the members of the company to the participant and become whistle-blower in case of any issue sighted.
The creation of a healthy working environment is equally important. The company must establish a culture where the voice of everyone matters.
Initial categories of risk
Following table containing initial risk categories is presented as follows:
RBS 1 | RBS 2 | Example Risk |
1. Factors relating to Technical Risk | Technology | Embracing new technology may create a challenge for the company |
Safety Plan | Failed to provide protection to both employees and employees | |
Technical processes | Improvement in Technology operations unsuccessful | |
1. Factors relating to Management Risk | Reputation of the Company | Organizational prejudice |
Corporate culture | Failing to follow corporate culture | |
Communication amongst Stakeholders | Lack of communication among stakeholders | |
Operation Management Team | Weak operation management team | |
4. Factors relating to External Risks | Government policies | Failing to safety protocols lead to government fines and penalties |
Society Structure | Societal pressure due to protecting environmental safety |
Conclusion
The Oil & Gas industry is very competitive and one can witness the competitiveness in the case study. There are various factors that the organization is considering to enjoy the benefits of growth and success. The critical success factors of BP are playing an important role in making the organization standing at the top. It is essential to mention that critical risk factors are very important to keep the company socially responsible. The company can avoid incidents like 2005’s explosion by implementing and following a strict list of initial risk categories.
References
Hillson, D., & Simon, P. (2014). Practical project risk management: the Atom methadology byDavid Hillson and Peter Simon (3rd ed.). Vienna, VA: Management Concepts.
Shaw, S., & Zabudsky, J. (2013). A Strategic Planning Approach to Technology Integration Critical Success Factors (2nd ed.). Place of publication not identified: Distributed by ERIC Clearinghouse.
Sim, L.-C. (2008). Introduction to the Policymaking Process. The Rise and Fall of Privatization in the Russian Oil Industry, 1–15. doi: 10.1057/9780230594760_1