Exploiting Change

Listen to the podcast: On Target 14-06-2010

BP CEO Tony Hayward’s performance in the Deepwater Horizon disaster in the Gulf of Mexico leads us to ask if companies can better prepare their executives for crises. At times, Hayward has seemed exhausted and despondent. His comments about wishing he could go back to life as usual and his occasional musings minimizing the ecological impact of the disaster clearly show someone who is out of his depth. This is to be expected in someone with little or no training in crisis leadership and decision-making.

I know of only one organization that truly prepares its leaders for crisis leadership, and that is the military. Compare Hayward’s discomfort with the coolness and reserve of Admiral Thad Allen. His command and leadership skills have been honed over a career in progressively demanding positions, including that of directing US federal relief efforts after Hurricane Katrina. His statement a few weeks ago that “We need to start under-promising and over-delivering” was at once refreshing and indicative of someone who has respect for the public and shows prudence in dealing with uncertainty. There is currently nothing comparable in the business world.

It is time for companies to emulate the military and to better prepare their senior executives and middle managers for crisis response and leadership under stress. Companies must select managers with excellent business acumen, but they also have a fiduciary responsibility to prepare and train them for disasters and crises, particularly when their actions and operations have such momentous risks.

© 2010 Richard Martin. Reproduction and quotes are permitted with proper attribution.