All The CEOs Not In The “Loop”

Tony Hayward of BP plc (NYSE: BP) was not in the “loop” about the Deepwater Horizon rig and any problems at the drill site. He says that his company has thousands of wells. and he may not have known where the leaking well was located.

His explanation of his ignorance sounds like that of Aika Toyoda, grandson of the founder of Toyota (NYSE: TM) and its current CEO. He could not have known about all the defects in his company’s cars or the need for recalls.

Toyoda’s and Hayward’s testimonies before Congress and the way that they defended themselves against hostile members could have been interchanged. Each was right. Their companies are too large for any one person to keep track of the minutia of operations.

But, the fish always stinks from the head.Toyota and BP each became immensely successful. Toyota took the spot as the No.1 car company from faltering GM. BP has been the world’s largest deepwater drilling company for more than a decade. Toyota should not only have been the biggest. It should have been the best. According to a number of quality surveys it was, until recently. The latest JD Power initial customer satisfaction survey put Toyota in 18th place, well behind most US car companies and even upstart Hyundai.

BP was a highly prized partner for drilling in northern Alaska, the Gulf, and the north Sea. It should have been at the top of the list to get a part of the fields off Brazil and Africa. Those opportunities are lost now.

Hayward and Toyoda did not do what they needed to, as leaders. pass a set of standards of candor, accountability, and pride in a job well done to their workers. It is astonishing that Hayward would say that it is too early to know what caused the Deepwater Horizon disaster. It is one rig, with one set of logs, and a small number of employees. Someone must know, or more than one person. But, no one is saying.

Documents received by Congress show that their was irresponsible behavior as Toyota. It considered risking money and bad PR that would have come with disclosures about accelerator or brake problems. There were problems apparently on the Deepwater rig since February. Neither the issues at Toyota nor  BP made it far enough up the chain of command so that some high-level executive could quickly acknowledge and fix them. Perhaps even the higher-ups living in a world where bad news was avoided.

Alistair Cooke once said of King Edward VIII  who abdicated the throne that the most damning thing that can be said about a man was that he was always at his best when things were going well.

Douglas A. McIntyre