Hayward acts to stem BP identity crisis By Carola Hoyos in London Published: June 21 2010 19:18 | Last updated: June 21 2010 19:18 At BP’s sprawling campus in suburban Sunbury-on-Thames and in the elegant halls of its headquarters in St James’s Square, Mayfair, the realisation that the company was in deep trouble set in about a week ago, two months after the deadly explosion of the Deepwater Horizon rig in the Gulf of Mexico. In spite of a barrage of news stories and internal e-mails from Tony Hayward, chief executive, who had decamped to Houston almost immediately, and town hall meetings led by the long-time chief financial officer, Byron Grote, employees from information technology to mergers and acquisitions felt relatively unaffected, “like ostriches with their heads in the sand”, as one person who works at BP described it. “The general feeling was one of utter malignment, being accused of having caused the accident before the actual cause of it has been established.” But that sentiment has been replaced by fear and shock after BP’s recent announcement that it is cutting three-quarters of this year’s dividend payments and establishing a $20bn claims fund. That quantified for the first time the magnitude of the problems. Members of one BP team well versed in the challenges of raising finance wept when they heard the news. In the following days employees began cautiously voicing anxieties about possible redundancies. Decisions over discretionary spending, whether on laptops or hiring contractors, ground to a halt in many departments as anxious middle managers awaited direction from higher ranks. Mr Hayward acknowledged that concern in his most recent intranet message to employees last week. “I recognise that the decisions that we have announced on our dividend, the capital programme, and divestments will be painful to many people – including, of course, to many of you.”
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2010 Media Report Villanova School of Business