British Petroleum is dead – deader than a petroleum jellyfish.
Old Ben Franklin had it right when he said “an ounce of prevention is worth a pound of cure” – in fact 95,000 barrels a day of cure. The BP Oil spill is a perfect example of the idiom at work. Plainly stated, to have relied on a single blow-out preventer when the well head is a mile below the surface in an environment where no man can go, in water that can freeze gas – well that is a planck weight, a veritable “nano-gram” of prevention, given the risk. What would the cost of a second or even a third blow-out preventer have added to the cost of this deep ocean well? In the wake, or should I say plume, of this disaster the cost would have been negligible.
As a result of the uncontrolled spill, BP’s stock plummeted yesterday losing nearly 15 percent of its value on the first trading day since the failure of the “top kill“. Then it sucked the market down with it as the federal government announced criminal and civil investigations into the spill. “We will closely examine the actions of those involved in the spill. If we find evidence of illegal behavior, we will be extremely forceful in our response,” said Attorney General Eric Holder in New Orleans. BP, with an enterprise value of $137 billion, is losing market value with every barrel that emerges from the floor of the Gulf. That loss of market value puts the clean-up and recovery at risk as well as the companies struggle to survive.
So what is the lesson here? There are certainly many to be learned – chief among them being that one cannot be too careful or take too many precautions when risking something of such enormous value. Think of your own business and its assets. Gauge their value to you and your future. Large or small, it may be hard to imagine losing everything, but then British Petroleum seemed impossible to sink – too big to go bankrupt, fail or be acquired – yet it’s on its way there.
Prevention is not just prevention against disaster – it is prevention against a plume of related consequential costs to your organization and to those that rely on it. BP is only part owner of the blown well. Rig operator Transocean and oil services company Halliburton are also involved and, therefore, also at risk. Cameron Inc., which made the blowout preventer that failed, is also in deep, deep trouble. Moreover, we are in trouble. We who rely on the strength of our economy; the health of the environment; the survival of the fishery, and the fitness of mother earth are all at risk. So when assessing the cost of prevention to your organization in the future and imagining that, perhaps, you can risk taking a chance or two with an important asset – think of British Petroleum. A desire to cut corners cut the business off at its knees and put our collective future at risk.
A planck weight of prevention is no prevention at all – how about putting a pound of it to work for you? If your cringing at the thought of your own preventive maintenance software, or lack of it, it might be time to get a little more proactive!
