Risk Management : Bp 's Failure Essay
Most risks in organizations lead to financial loss or gains depending on how well organizations identify risks and reduce as many risks as possible. Not managing possible risks within an organization effectively can result in consequences or possibly worse. Therefore, managing risks within an organization should be vital for the organizations to be successful and should not be overlooked. Operational risk arises from three key areas of an organization: people, processes, and technology. To prevent operational risks from arising, organizations needs to consider operational considerations. They need to look at plans and processes to identify any potential risks and to reduce and prevent potential risks and to make sure that the workplace is safe. The failure to implement risk management plans and reduce risks can be a possible result such as the case similar to the BP oil company.
BP’s Risk Management Failure
On April 20, 2010, there was an oil well blowout on the Deepwater Horizon oil rig which led to the death of 11, injured numerous, and a loss of nearly 5 million barrels of oil leaked into the Gulf of Mexico. The oil leak also damaged hundreds of coastline before it was capped 3 months after the blowout. The federal invested the gulf spill and reported that “no risk assessment [was] done before blowout” (Zolkos and Bradford, 2011). There were multiple causes to the disaster and involved multiple companies, driller Transocean Ltd. and cement…