Too much of one, not enough of the other: what BP and other oil companies should be doing—and should have done
It took a sophisticated 75-ton piece of equipment and more than 80 days, but it appears the Gulf oil gusher has been stopped. It is time for innovation to begin. I have written about, taught, and practiced product and service innovation for more than 30 years. The BP (BP) spill in the Gulf reminds me once again that the innovation process is not limited to figuring out new products for the marketplace. It can be a highly effective way of dealing with disasters and, even more important, preventing them from happening. So how can BP use innovation to solve this problem and others like it in the future? The answer is by employing the same problem-solution approach to addressing the oil spill that product innovators use, starting with identifying and clarifying problems and needs. Until a specific understanding of the problem from multiple perspectives is in hand, finding a workable solution is guesswork at best. With regard to the oil spill in the Gulf, the innovation process should have been applied in two ways. First, well before the Deep Horizon oil rig blew up and sank, BP should have been using the process to identify ways to deal with such an event so that we did not have 80 days of oil flowing uncontrollably into the Gulf. Second, the process should have also been used when it became apparent that the oil was gushing and there was no way to stop it. I'll deal with that first. Search for Fresh Ideas
Once the oil spill began and none of the systems to stop it worked, BP should have moved immediately to gain access to multiple technology solutions, going beyond any BP internal technologies to find inventions, equipment, and processes that might help. There is no question in my mind that this search for fresh ideas and technology would have quickly led to a handful of ways to stop the oil that had a real chance of working. It is easy to imagine the competitive and legal pressures that would prevent those in the oil industry from swiftly coming together to find a way to stop the oil. A useful role for the government would have been to convene that process. The frenzied activity to try to plug the broken wellhead one mile below the waves reminds me of the very worst approaches to product development and branding strategy. It was as if new products were rushed to market. First came Containment Dome, followed by Top Kill, and Junk Shot, and finally Top Hat, put on after the Big Shear replaced Diamond Saw. And still the oil gushed forth. These were bad products, and when each of them was given a catchy nickname—a brand—the brand was immediately destroyed, and with it a bit of BP's reputation. There is a lesson in this for any business that wants to bring a new product to market. Long shots seldom work. Instead of swiftly applying the innovation process to find ways to stop the runaway well, BP took one long shot after another and as a result will pay a steep price in dollars and reputation for many years to come. An important part of the innovation mindset is the breaking-down of silos. BP appears finally to have stopped this particular gusher. But it is a specific solution to a specific problem. How about the future? BP, and others in the oil industry, should assemble a cross-functional group of scientists, engineers, oil production experts, refinery specialists, and others from around the world to generate multiple solutions to disaster scenarios. Then each potential solution should be screened relative to time, feasibility, and effectiveness. Once solutions that appear feasible are fleshed out, each one would be simulated or mock-tested. The point is to generate multiple solutions based on real-world technologies and hard-core expertise—not pie-in-the-sky brainstorming. Testing Possible Solutions
Even if the 75-ton cap holds, the relief wells should be drilled to completion. Remember, we were continually reminded that the relief well approach had never been used at such depths and pressures. This is an opportunity to find out if having a relief well in place can stop a gusher in extremely deep water. With the relief wells completed, they can be tested to see if they can be plugged, and important information will be in hand for the future. (By the way, I don't believe for a minute that once the spill is under control that such a productive and expensive well will simply be plugged. If BP wants a grand PR gesture and to keep its investment intact, it could apply the proceeds from that well to Gulf Coast restoration for years into the future.) It is impossible, of course, to do a full-scale test of every idea. But as with test marketing, ideas for preventing disaster can be developed and tested to a high degree of certainty. Against the backdrop of Top Kill and Top Hat, people laughed at a suggestion to nuke the oil well. But suppose the idea of non-nuclear high explosives fed deep into the well had been carefully considered and tested? That brings me to applying the innovation process to future disasters of all kinds, a challenge much bigger than just oil spills. Government and industry have a responsibility to figure out what threats beyond oil should be on the priority list; what are the solutions to each one's worst-case scenario; what can be done to ensure the solutions will work; and who is responsible? When you are in the teeth of a disaster, it is hard to sort out who holds responsibility. Disasters in the public domain—earthquakes, volcanoes, hurricanes, and wars—certainly fall on the public sector and taxpayer dollars. But those in the private sector—oil, nuclear energy, biotechnology, and others where shareholder interest comes first—should hold responsibility for identifying and testing solutions to worst-case scenarios, with a healthy dose of government oversight. With luck, the oil has been stopped, and eventually—albeit at great expense—nature will reassert itself. But shame on us all if the only lesson we learn is a strategy for plugging broken oil wells in deep water. Applying innovation to disaster planning can lead to much more.