Industry Analysis Case Study

BP's Deepwater Disaster (A): Oil Industry's Value Chain Risk

OR

Abstract:

Developed for the Strategy course, this case study analyses the nature of oil industry through value chain analysis and the risks involved in it. On April 20th 2010, Transocean’s Deepwater Horizon drilling rig, leased to the oil giant BP, exploded and sank 5,000 feet below water, resulting in a massive oil spill. The Gulf of Mexico oil spill has once again brought forth the debate over the safety of the oil industry and has shed light on the risks and dangers associated with the oil industry. The case study also debates on organisational preparedness in the light of inherent industry nature and discusses the kind of organisational capabilities required at each of the stage of the industry's value chain.

Pedagogical Objectives:

• To understand the nature of oil industry's risks with the help of oil industry's value chain analysis
• To analyse the major oil mishaps and assess whether they could have been prevented
• To debate on organisational preparedness in the light of inherent industry nature and discuss the kind of organisational capabilities required at each of the stage of the industry's value chain.

Keywords : Value Chain, Value Chain Analysis, Oil Industry's Value Chain, Up Stream, Mid Stream, Down Stream, Risk Assessment in Oil Industry, Diversifiable Vs Non-Diversifiable Risk in Oil Industry, The Gulf of Mexico Oil Spill, BP, Tony Hayward, Managing Crises, Organizational Capabilities, BP's Organizational Preparedness