Evaluation of British Petroleum's Learning Effectiveness
Evaluation of British Petroleum's Learning Effectiveness
. Introduction
Organization learning plays an important role in organizational survival, growth, and developing in the increasingly changing environment. (Popper& Lipshitz, 2000) Expect responding to the changing environment (Dodgson, 1993), organizational learning also contributes to the participant of employees' thinking and their commitments (Senge, 1990), with a consequential result of a long-term development of the organization. (Kloot, 1996) Nowadays, more and more researchers have exploited a number of issues on transforming corporations into learning organizations which embrace learning at all levels. (Stewart, 2001; Pedler, Burgoyne & Boydell, 1991) According to Senge (1996, p.35), learning organization is defined as "in which learning becomes institutionalized as an inescapable way of life for managers and worker alike".
As one of the biggest organizations in the world, British Petroleum (BP) has regarded itself as a learning organization that tried to be adapted and responsive to the changing environment through learning. (Prokesch, 1997)It is the purpose of this report to critically examine BP's learning effectiveness through our learning mode. Firstly, after a brief explanation of our learning mode and the background of BP, the evaluation of BP will be provided in depth by six elements, which are respectively teamwork, communication, leadership, knowledge management, motivation and culture. Then the evaluation of our learning model through the case of BP will be discussed. Apart from these, a learning diagnosis of BP will be offered, which focus on the assessment of teamwork. Before the conclusion, the major learning barriers of BP will be provided as well as the recommendation to overcome it.
2. Explanation of Our Learning Model
Inside our organizational learning model (See Appendix 1), there are three levels, which are respectively individual level, team level and organizational level, embracing the process of planning, action, monitoring and evaluation. All these three levels interact with the external environment which results in an open system with double-loop learning process. The model comprises six key elements, which include knowledge management, culture, leadership, teamwork, communication and motivation. As learning is an ongoing process, our model exists through both an internal running cycle and an external continuous interaction. (Chen, Luo, Lin, Pakapan, Chun, & Piyaporn, 2004)
3. British Petroleum's Background
As one of the world's biggest oil and petrochemical companies, British Petroleum (BP) has international operations in over 70 countries with 233billion revenues, and 103700 employees. It focuses on oil and gas exploration and production, the supplying of petroleum products, and the manufacturing and marketing of chemicals. Currently BP owns five recognized brands worldwide which include BP, am/pm, ARCO, Aral and Castrol. (BP home, 2004)
With the rapid change of the external environment, BP has regarded itself as a modern, global, decentralized and learning corporation that must learn to be adapted and responsive accordingly. (Prokesch, 1997)The leaders of BP knew that to maintain BP's competitive advantages and its leader position, it is no more relies on their experiences but the technical skills, political and operational knowledge because oil may be found in more challenging environment and even will be replaced by alternatives, such as hydrogen and solar, in the future. (Robert Paterson's Radio Weblog, 2003) John Brown, BP's CEO, has claimed that learning is the foundation stone of BP to adapt to change. To identify the opportunities that their competitors may not see, BP has to create and distribute knowledge throughout the organization, thus learn faster and exploit faster than their competitors. (Prokesch, 1997, cited in Popper, 2000) Similarly, Mr Ashton, head of BP's information technology architecture and strategy, claimed "BP needs to know what it knows, learn what it needs to learn and apply that knowledge as quickly as possible for sustainable competitive advantage," (Newing , 1998, p.11) Thus, the vision of BP is to be "an integrated world-class, agile learning organization" (Newing, 1998, p.11)
4. Evaluation of BP's Learning Effectiveness through the Learning Model
According to our model, there are six major elements that embracing the learning process, which are teamwork, communication, leadership, knowledge management, motivation and culture. (Chen, et al., 2004) In the following part, these six elements will respectively be evaluated within BP's operation to identify its learning effectiveness.
4.1 Teamwork
Teamwork is viewed as an effective implement to share learning. This is reflected by its definition that "a small group of people with complementary skills, who work together as a unit to achieve a common purpose for which they hold themselves collectively accountable". (Wood, Chapman, Fromholtz, Morrison, Wallace, Zeffane, Schermerhorn, Hunt and Osborn, 2004) In BP, virtual teamwork, which restructured employees into small units, has been long adopted in the organization from 1994 and has generated much effectiveness. For instance, when attempting to develop Andrew oil field in the North Sea in 1995, a drilling ship ground to a halt because of some equipment failures. It was virtual teamwork that contributed to solve this problem by working with the onshore experts through a video satellite link-up when the people on the ship could not identify the problems. Hence, virtual teamwork helps people work in a far distance, such as employees in the Gulf of Mexico can even work with workers in the Eastern Atlantic. (Anonymous, 2002) Furthermore, BP also use virtual team network outside of the organization, working with their contractors and suppliers in order to reduce both the cost and time of the project. As according to Prokesch (1997), the benefits of teamwork in BP were the decrease of helicopter trips, avoidance of refinery shut down, interaction improvement, and more significantly effective collaboration. Accordingly, the adoption of teamwork is more likely a tool of dissemination of information, facilitating knowledge sharing, and innovating than just a troubleshooting implement. (Anonymous, 2002) That is, teamwork helps BP to work more effectively and sharing learn more broadly.
4.2 Communication
According to West and Meyer (1997, p25), learning organization can be facilitated by "enriched relationships that are created and enables through communication". Accordingly, communication is another useful tool to increase shareing knowledge, improveing cooperation, and embracing learning. (Griffith, 2002) Among a number of communication methods, electronic communication is favored by many organizations because of its easy and fast accessing, with a consequential result of fast strategic decision making without geographical and structural barriers. (Castle & Sir, 2001; Joyner & Onken, 2002) As happen in BP, the leaders believe the information technology is the centre for ...
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4.2 Communication
According to West and Meyer (1997, p25), learning organization can be facilitated by "enriched relationships that are created and enables through communication". Accordingly, communication is another useful tool to increase shareing knowledge, improveing cooperation, and embracing learning. (Griffith, 2002) Among a number of communication methods, electronic communication is favored by many organizations because of its easy and fast accessing, with a consequential result of fast strategic decision making without geographical and structural barriers. (Castle & Sir, 2001; Joyner & Onken, 2002) As happen in BP, the leaders believe the information technology is the centre for people to do things. (BP home, 2004) In order to achieve the basic capability for employees to communicate, IBM and Dell computers and Compaq servers are offered to 33000 employees replacing the mixed personal computers. Expect a standardization of Windows platform and Microsoft office are adopted, telecoms, intranet and even desktop video conferencing systems are designed to support better communication throughout the organization. These equipments contribute employees to work together electronically at any time in any place and the common operating environment offer necessary channels for people to communicate, share experiences and skills, ultimately the quick learning of the whole corporation. (Newing, 1998)
Moreover, an upward feedback meeting is carried out inside BP which continually improves the relationship between managers and employees. This upward appraisal not only helps supervisors to listen to their employees, but also provides a place for employees to assess the managers' performance and respond to the business decisions, consequentially improve communication and build trust with each side. (Moravec & Gyr, 1993)
4.3 Leadership
As one of the key elements in our learning model, leadership has been defined as people who continue facilitate organizational change as well as their personal development. (Senge, 1996) The major role of leader is to create a learning atmosphere that helps their followers change rather than maintain in an existing state. (Senge, 1990; James, 2002) BP's executives have recognized their roles of a learning organization and did well in this field. BP's CEO John Brown has ever summarized managers' commitment as "Leaders have to demonstrate that they are active participants in the learning process. You can't say "Go do it" without participating' ". (Prokesch, 1997, cited in Popper, 2000, p.194) In practices, BP's leaders act as transactional leadership, which strongly emphasize on learning-goal orientation (Bass and Avolio, 1994, cited in Coad & Berry, 1998), to support employees' activities rather than direct control. For instance, in the behavior-based safety (BBS) process, which is a program to encourage safety behavior, supervisors take the strategic support role to help employees developing their safety knowledge and stimulating their participation by attending steering committee meetings by themselves, providing resources, giving positive reinforcement, with a consequential result of great employee acceptance of BBS. (Byron, & Thomas, 2003)
4.4 Knowledge Management
In the process of organizational learning, knowledge management is viewed as one of the infrastructural factors because of the need of sharing knowledge, interaction and innovation throughout the organization, especially learning organizations. (Amabile, Conti, Coon, Lazenby & Herron, 1996) In all individual, team, and organizational levels, the transformation of complete, undistorted and verifiable information plays a key role to increase organizations' ability of responding to current and future requirements. (Popper, 2000) As BP is a complex and global enterprise, its framework of knowledge management is base on the computer networks. That is, every network member of BP owns dual identities, one of which is the role of his/her functional unit while another is the member of the network he/she participating to support the federal welfare. The network is regarded as a cheap and effective approach to share information because there are more than 250 networks with 18000 knowledge employees participating in it which including employees, contractors, engineers, scientists and technicians. Individuals with similar interests and common objectives may share their skills and experiences in different networks to support certain project needs, such as the refinery operations managers network, engineering authorities network and drilling learning. (Barrow, 2001)
4.5 Motivation
According to Lehr and Rice (2002), motivation refers to both the internal and external drives stimulating an individual to act and sustain behavior to a certain objective. To share knowledge, to achieve all levels of individual, team and organizational learning, motivation plays an important role to drive these ideas into practice. (Byrne, 2001) As discussed above, behavior-based safety (BBS) is one of the BP programs to encourage safety behaviors, employees are encouraged to join the committee but not coercively required. The leaders believed that some employees may reluctant or even resist involving in the activity when this program was first carried out. Accordingly, the corporation motivated their employees by carrying out the compensation packages of recognizing the meaningful behavior and achieved performance. For instance, expect social recognition, a day off with pay or free video rental cards would be provided to the champions of BBS Programs. A positive effect from this motivation was many skeptics employees have finally become strong proponents of BBS program, thus learn to behavior safely. (Byron & Thomas, 2003)
4.6 Culture
Culture is the final element in our learning model. As Pool (2000) argued that a supportive culture may contribute to organizational learning by encouraging employees' learning performance. In BP, the goal of culture change is to replace the present culture and commit to a new one which emphasizes on open thinking, personal impact, empowering and networking. It is believed that learning will be highly enhanced when organizational members feel free to challenge their own mental models, create new ways of thinking as well as share leadership. (Macher, 1992; Gardiner, 1999) Hence, one of the program of "Project 1990" of BP was to transform BP's old culture to a new faster moving organization that embraces teamwork, effective compensation system, and employees empowerment, with a consequential result of achieving real competitive advantages. (White, 1992)
5. Evaluation of Our Learning Model through the Case of BP
As one of biggest global companies worldwide, BP is attempting to improve its operational safety record and employees' health. As its health and safety objective reflects that "The health and safety of our employees and of those who come into contact with our operations and products is one of our highest priorities: our goal is clear - no accidents and no harm to people". (BP Home, 2004) Accordingly, BP attempts to prevent and minimize the potential catastrophic accidents by offering training programs. However, training hasn't be identified as a key factor in our learning model. Accord to Gordon (1992), organizational learning is a process to help people create new knowledge and continually improve their capacities, thus improve the performance of the whole organization. Training plays an important role in this process to help people achieve the creating new knowledge and sharing understanding, thus improving organizational performance. At BP, one of its safety plans is to offer online health-and-safety training programs to 80000 to 100000 employees, managers and contractors in order to distribute the usual safety issues. (Anonymous, 2003) Besides this, a behavior-based safety (BBS) process, which has been discussed above, is also a training program designed to dispread safety issues, change employee's old mental models, and thus strengthens their safety consciousness and behaviors. Management demonstration, champion selections and coaching are also carried out with the training program to reinforce the shared learning throughout the organization. (Byron & Thomas, 2003)
Expect training, many researchers have also explored various internal elements which influence organizational learning, such as organizational climate (Mohanty & Deshmukh, 1999), performance management system, senior management commitment (Appelbaum & Gallagher, 2000), organizational structure (Gephart, Marsick, Van & Spior, 1996). It is the limitation of our model that hasn't mentioned these factors and ignored their roles in learning. However, although not all factors have been identified in our learning model, our model, in some way, can still act as an effective tool to analyze organizations' total effectiveness, such as BP, because it composes of three levels in which all embrace six key elements (knowledge management, leadership, teamwork, culture, communication and motivation). It is an ongoing cycle and open learning system that interacts with external environment. (Chen et al., 2004) Moreover, it is considered that there will have no the best learning model in the world because it is impossible to cover all the key factors. Every element should be viewed as an essential, equal but partial role to influence organizational learning.
6. Diagnosis of the Model
As evaluating BP's learning effectiveness through the six key elements, which is discussed before, the company appears to have done satisfied job to encourage learning in many areas. To further assess organizational performance, diagnosis is viewed as a useful tool to assess various aspects of organizational behaviors, thus help to improve the performance and ensure continue development. Especially when organizations are learning systems, diagnosis strongly contributes to motivate organizational members engaging in learning and changing process, with a long-term impact of organizational improvement. (Beer & Spector, 1993) The following diagnosis is the example of teamwork assessment, which is suggested in our group report, to evaluate BP's effectiveness of teamwork. However, as just one type of questionnaire, it is limited because it has little consideration of the factors of communication, leadership, knowledge management, motivation and culture, which have been discussed before.
Items
Questions
Strongly Disagree
(Score:1)
Disagree
(Score:2)
Neutral
(Score:3)
Agree
(Score:4)
Strongly Agree
(Score: 5)
Factors
.
All tasks require some amount of attempt.
V
Obstacles
2.
Employees are allowed to create the new way of working.
V
Task related characteristics
3.
Employees are allowed to learn from mistakes rather than be punished.
V
Obstacles
4.
In our company people are often asked to do the new task that they rarely had experienced before.
V
Task related characteristics
5.
In our company sometime people are assigned to work out of their expert area.
V
Task related characteristics
6.
Information and consultation are always available for the request of employees.
V
Support
7.
Job rotation has been well implemented in our company.
V
Transition
8.
Knowledge transfer cross-function is viewed as asset process.
V
Support
9.
Knowledge workers are encouraged to transfer their experiences and abilities to others.
V
Transition
0.
People are challenged to overcome the barriers in their works.
V
Obstacles
1.
People are encouraged to learn and practice multi-skill.
V
Transition
2.
People have informal relationships, regardless of organizational hierarchy.
V
Support
3.
People realized that their work effects organization as a whole.
V
Task related characteristics
4.
Reward system encourages people to learn new things.
V
Support
5.
The tasks have the level of difficulties, but still achievable.
V
Obstacles
6.
There is a widespread information exchange within organization.
V
Transition
7. Major Learning Barriers in BP and Recommendations
As BP regarded itself as a learning organization and put much efforts in it, it has succeed in enhancing learning in many areas, such as the teamwork which is reflected by the diagnosis. However, unavoidably BP still has certain learning barriers because of the interaction between their relatively straightforward objectives and the learning process. Research has showed that although BP has used computer networks effectively enhancing knowledge management and communication, electronic technology actually create pitfalls as well as its benefits. For instance, security concerns such as hackers, permanent e-mail records which prevent employees to be frank, over-emphasis on speed which forces managers have little time to define common objectives, and network of too many members which is hard to build a close environment will all prevent learning flowing throughout the company. (Anonymous, 2002) To overcome these major learning barriers, it is wise for BP to build a trusting climate to improve the relationship among their employees. According to Coopey (1998), trust contributes to a high level of commitment to the organization as a whole. When employees become committed to their organization, more space for learning can be occurred and they will be willing to learn, innovate, and contribute their experience and expertise, thus more likely associate with a learning organization. (Gardiner & Whiting, 1997)
8. Conclusion
Organizational learning is one of the inevitable trends because organizations have to adapt to the changing environment by learning. Using our learning model and the diagnosis of teamwork to evaluate BP's learning effectiveness, it appears that BP has done well in encouraging learning at all its organizational, team, and individual levels. Virtual teamwork, participation of leadership, sharing knowledge via computer network, fast communication through intranet, relative reward system, and positive culture change have been adopted to facilitate employee engaging in sharing knowledge, effective cooperating, and ultimately enhancing learning. However, BP has to overcome its learning barriers by building a trusting relationship among its staffs, thus continuously innovating and developing their learning performances. In contrast, when using the case of BP to evaluate our learning model, it reflects that our model can be viewed as an effective tool to assess organizational learning because it is an open and double-look system embracing six key elements. When considering it is impossible to cover all the key elements in a learning model, it appears there will be no the best model in the world because learning is an ongoing process and will influenced by various factors. What organizations should do is to pay their attention to encourage and continuously develop learning in all areas in order to survival, maintain their competitive advantages and continuously grow in the changing world.
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Appendix
Appendix 1
(Chen, et al., 2004)
MGF5510- Organizational Learning
