The BP Failure: Exhibit A

The New York Times documents the numerous times that British Petroleum had problems with its deep-sea drilling program, yet failed to heed the warnings and proceed more cautiously. The tone of the article is one of shock. But, sad to say, we’re not at all surprised. What BP did is, too often, business as usual.

As we documented in our book and have said many times in this blog, it’s hard to be the guy saying no. If you’re the safety guy at BP, you’re the one who’s raising costs by insisting on safeguards. You’re the one who may kill a project entirely. So, you’re the one who’s taking down everyone’s bonus, at least in the short run. And your objections are hypothetical. If you say something has a one-in-ten chance of failing, that means that 90% of the time there won’t be a problem. If, as is more likely, you’re saying there is a one in a thousand or one in ten thousand chance that a part or process will fail, no one will take you at all seriously.

People don’t like thinking about failure, so they miss important lessons. If you’re really smart, you’ll learn lessons from others’ failures and never have to make them yourself. At the least, unlike BP, you have to learn from your own failures.

You have to do things differently if you want a different result. Businesses need to find better ways of testing risk and getting all potential problems on the table, or we’ll continue to have sub-prime mortgage crises, oilwell explosions and so forth that weren’t foreseen, even though they could have been, and that wind up taking down huge companies like BP, devastating whole industries or even threatening the world economy.

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