Corporate Strategy Case Study

BP: Trying to Win Back its `Green` Image

OR

Abstract:

Since March 2006, British Petroleum’s (BP) pipeline at Alaska Tundra Region, which connected Prudhoe Bay (the biggest oilfield of US) and Trans Alaskan Pipelines was virtually collapsed. Surveillance team jointly operated by BP and government officials revealed that the six miles long pipeline connecting the oilfield and the Trans Alaskan pipeline was severely corroded. This led to the decision to close down the oilfield. This incident reduced oil transportation through the pipeline to one fourth, affected BP’s top-line and bottom-line and led to a severe PR disaster for the company. Analysts often wondered how a company like BP, which made ‘green’ a core part of its identity and re-branded itself as ‘ Beyond Petroleum’ suffered from the worst oil spill. It was later revealed that to put more and more emphasis on cost competitiveness the company failed to take proper preventive measures to check the corrosion of the oil field. Analysts opined that though the company still believed about its ‘green’ ethos and values, it needs to be aligned with the business philosophy that the company practiced in the field

This case gives in detail about Prudhoe Bay incidence, its impact on BP’s ‘green’ positioning and environment friendly image, strategy taken by BP to win back its ‘green’ image and how the company planned to prevent similar incidents in future without affecting its cost competitiveness

Pedagogical Objectives:

• To discuss the importance of integrated strategy in the context of Prudhoe Bay incidence
• To analyse the implication of the Prudhoe Bay disaster in BP’s corporate image
• To discuss the importance of damage control initiatives in the context of BP

Keywords : Corporate Strategies Case Study; British Petroleum (BP); Alaska Tundra region; Trans Alaskan pipelines; Prudhoe Bay; Atlantic Richfield Company; Castrol; Conoco Phillips; Pigging; Ultra sounding; Couponing; Corrosion; 'Beyond Petroleum'; BP Exploration (Alaska) Inc; North Slope