Risk management Failure Essay Example | Topics and Well Written Essays - 1500 words

Risk management Failure - Essay Example The overall discharge of the spill was estimated at 4.9 million barrels, which covered an area of 780,000 cubic metres (Jervis and Levin 2010). The disaster was followed by major attempts to protect the estuaries and wetlands of the region, from the spreading oil. The impacts of the spill included the destruction of wildlife and marine habitats in the area; the stagnation of the tourism and the fishing industry of the region, as well as the human health issues that continued to be felt until year 2012 (Robertson and Krauss 2010). Following investigations, the causes of the disaster included the use of defective cement; the ineffectiveness of the operations of Halliburton and Transocean, as well as the lack of effective risk assessment by BP (NOAA 2011). This paper will explore the impact of BP’s failure to manage risks, which resulted in the BP disaster. The risk management failures of BP that led to the disaster Risk management failures were among the core factors that led to the 2010 BP disaster at the Gulf of Mexico (Zolkos and Bradford 2011). ... However, the contributory roles of the two secondary companies blamed for the disaster could have been mitigated through an effective investigation and the management of the risks facing the project. For example, the report from the investigation showed that the cement used during the construction was defective. Through effective risk assessment and management, BP would have discovered that the cement supplied was defective, therefore would outsource good cement for the project (Ingersoll, Richard and Reavis 2013). The Macondo blowout of 20th April 2010 was caused by a string of company decisions by BP, which increased the risk levels of the project. The company, also failed to assess different areas that would help it mitigate the risks of the project. These risk management failings include that BP did not carry out an official risk assessment of the critical operational choices made during the days prior to the disaster. For example, through administering an effective risk assessme nt process, the company would have discovered the risky operations planned during the execution of the project. Through the assessment, the BP Company would have exposed any organizational issues that were likely to affect the credibility of the decision-making process. Through exposing the different areas of risk – whether in the areas of planning or implementation – the company would have averted the incidence of the disaster. Therefore, the company’s failure to assess the risks that contributed to the disaster was a contributing factor. Through effective risk management prior to the disaster, the company would have detected the engineering weaknesses in the plant, therefore would have recommended some precautions to the issue (Zolkos and