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Oil spill case study summary
Three important topic of globalization that effect on environment
Three important topic of globalization that effect on environment
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Recommended: Oil spill case study summary
On April 20, 2011, an oil rig in the Gulf of Mexico exploded on British Petroleum’s (BP) Deepwater Horizon. As a result, of the 126 BP crew members aboard, 11-15 were reported missing. Six days later, underwater robots reveal at least two leaks are dumping 1,000 barrels of oil into the Gulf per day. Consequently, this would become one of the worst oil spills in the history of the United States and perhaps the petroleum industry. This recent Oil Spill portrays one of many dilemmas BP has faced as it scrambles to expand and globalize itself as a transnational corporation in the world economy against other oil and gas companies. Although this disastrous event has affected BP negatively, the company has found a way to overcome it, while still becoming the 6th largest in the world; it continues to do this by offshoring, outsourcing, and merging with other oil and gas companies, three key strategies BP has been using since its establishment in 1909. Globalization as Matthew Sparke defines, "is the extension, acceleration, and intensification of consequential worldwide interconnections” (2013, p. 3). In others words, globalization integrates social, economic, and political factors that shape the world. Globalization can be thought of as a great phenomenon; similarly, it can be thought of as quite the opposite. This paper will explain when, where, how and why BP Plc. has become a transnational corporation through globalization by offshoring, outsourcing, and merging with other companies. In addition, this paper will discuss the successes and consequences caused by globalization through BP’s three key strategies. Like many others who start out, BP Plc. was a small company struggling to succeed after experiencing almost two bankruptcies. B... ... middle of paper ... ...exico, resulting in the death of humans, wild and marine lives, in addition to contaminated water. Admittedly, I’m of two minds when it comes to globalization. On one hand if it expands a company or a business that will in turn provide people jobs and raise their standard of living, it should be encouraged. On the other hand, if it exploits workers and places the environment at risk, we should approach it from a different perspective. We currently live in world where globalization has indeed increased the interactions amongst people, but not in a good way; globalization as it considered by neoliberals a leveler, has done the opposite. While that’s another topic to be discussed, my point is, globalization is good, but it seems that the consequences which it has generated for BP Plc., is far greater than the good it produced for the people and the environment.
Globalisation is a growing phenomenon that is the result of various developments in the global environment, each of which merits an individual analysis of its social impacts. For the purpose of this analysis, the focus will be placed upon arguably its most controversial aspect, offshore outsourcing. Offshore outsourcing, or offshoring, is becoming an increasingly common business practice as a result of a combination of the recent technological advancements in the areas of transportation and communication, and the increased competitiveness of the business world. From the perspective of firms, tapping into cheap labor from less developed countries is a very logical business decision to reduce costs and maximize profits. This has not only motivated businesses to engage in offshoring, it has sometimes been critical to their survival in fiercely competitive environments.
Begley, S., Yarett. I., & Stone, D. (2010). What the Spill will Kill. (Cover story). Newsweek, 155
On April 20, 2010, the Deepwater Horizon oil rig, located in the Gulf of Mexico exploded killing 11 workers and injuring 17. The oil rig sank a day-and-a-half later. The spill was referred to as the Deepwater Horizon oil spill, BP oil spill, Gulf of Mexico oil spill, and BP oil disaster. It was first said that little oil had actually leaked into the ocean but a little over a month later the estimate was 12,000-19,000 barrels of crude oil being leaked per day. Many attempts were made to stop the leak but all failed until they capped the leak on July 15, 2010, and on September 19 the federal government declared the well “effectively dead.” In the three months that it took to finally put a stop the leak, 4.9 million barrels of oil were released into the ocean. The spill caused considerable damage to marine and wildlife habitats and the Gulf’s fishing and tourism industries. The White House energy advisor, Carol Browner, goes as far to say that the Deepwater oil spill is the “worst environmental disaster the US has faced.”
As a result many marine animals are at an increased risk of health issues from fatal compounds once they are absorbed a plethora of health issues arise such as ulcers, liver failure, kidney failure, increased infertility among species, and brain damage (National Oceanic and Atmospheric Administraion,2010).Another essential point is that oil rig accidents which occur on open water are much harder to clean up that oil spills on land since the material is spread along coastlines and coral reefs much farther by traveling atop the water thus taking longer for cleanup(Cooper,1992). Subsequently marine wildlife continues to ingest and absorb the crude oil which ultimately take a toll on their bodily functions (National Oceanic and Atmospheric Administration, 2010). Moreover, countries with a diverse marine ecosystem such as the country of Belize rely on tourism and fishing to generate much of their economy, an oil spill would mean that locals would have to find different sources of food since the fish will be contaminated and the tourist industry will take a huge hit which will take many years for it return to normal statistic and still not return to its original state (Cisneros-Montemayer, Kirkwood, Harper, Zeller, and Sumalia, 2013). It can be seen that oil extraction initially has a high amount of economical outcome, but it’s value decreases exponentially, yet tourism continues to boast a steady number of US$183 Million every year due to a wide range of environment tourism (Cisneros-Montemajor et al,
Winston A, 2010, Five Lessons from the BP Oil Spill, Harvard Business Review, accessed 1 April 2014,
Since the oil spill, information has been revealed which shows that the cause of the explosion on Deepwater Horizon was caused from shortcuts. BP was running behind in production and was doing anything and everything, safety measures aside, to catch up (Broder, 2011). This kind of accident is associated with cost cutting within the company. They disregarded any risk management procedures, chose to make last minute changes to any plans, bypassed observation rules, and allowed for other safety measures to be neglected in the name of cutting costs.
When the term “Globalization” is discussed, most academics, scholars, professionals and intellectuals attempt to define and interpret it in a summarized fashion. My main concern with this approach is that one cannot and should not define a process that altered decades of history and continues to, in less than 30 words. Global Shift is a book with remarkable insight. Peter Dicken rather than attempting to define the commonly misused word, explains Globalization in a clear and logical fashion, which interconnects numerous views. Dicken takes full advantage of his position to write and identify the imperative changes of political, economic, social, and technological dimensions of globalization.
On April 20, 2010 The popular gas company ‘BP’ commonly known as British Petroleum, was responsible for one of the largest oil spills recorded in human history.
Globalization remains a pivotal topic in many schools of thought, and continues being a topic of controversy even in local economies today. Perhaps the reason for this is integration and competitiveness the world over. Conceivably, even more than integration, is the competitiveness of organizations, has possibly facilitating the fascination and misconception about of globalization. Nevertheless, globalization has brought about a number of effects influencing the design and geographical location of the organization. However, globalization has effectively placed the world in a bubble, or maybe one could equate the changes to being placed in an envelope.
Now, before I bash globalization it is some positive I would like to discuss. Globalization is great for the American economy; we can supply the world with our goods and services, which in turn can possible, relieve the deficit we’re in. “Homegrown industries see trade barriers fall and have access to a much wider international market. The growth this generates allows companies to develop new technologies and produce new products and services.” (Buzzle) Also, globalization leads to better relations between countries when they create trade agreements. Globalization does not drain every under-developed company but brings a new era of economic change and the hope of being a world super power to certain nations. “Economic globalization gives governments of developing nation’s access to foreign lending. These funds are used on infrastructure including roads, health car...
In today’s continuously changing world, many experts say that globalization is what every business, organization, and nation should seek and welcome as a positive change. However, many people are unaware of the main focus and meaning of Globalization, especially in comparison to Localization. A large number of people believe that globalization is just another common word used to refer to changes and differences that cannot be explained or accounted for. Therefore, many different activities or changes are improperly labeled to be a part of or caused by globalization.
As a conclusion international business best described as a Globalization. A globalizing business sector advertises viability through rivalry and the division of the work it permits individuals and economies to keep tabs on what they specialize in. It also allows people to go globally. Globalization has stretched the assets, items, administrations and markets accessible to individuals. The increasing set of reliant connections around individuals from distinctive parts of a world that happens to be separated into countries
The BP Deepwater Horizon oil spill accident of April 20th 2010 that caused a gas release followed by the explosion that took place causing hydro carbons to leak into the Gulf of Mexico posed a lot of strategic implications in the competence, capabilities, internal resources and Corporate Social Responsibility of BP. The implications of the Oil Spill underscores the Icarus paradox, which holds that the very capabilities that give an organization its source of competitive advantage can become constraining with changes to the external context. Teece (2009) emphasised that dynamic capabilities revolve around three generic types namely: Sensing (ability to scan, search and explore the external
Stonehouse, G., Campbell, D., Hamill, J. & Purdie, T. (2004). Global and Transnational Business (2nd ed.). Chichester: John Wiley & Sons.
Globalization’s history is extremely diversified and began during the beginning of civilization. Now we live in a world that is constantly evolving, demanding people to use resources in locations that are very difficult to obtain certain resources. This could make it completely impossible to operate in these specific parts of the world. However, globalization allows people across the world to acquire much needed resources. Globalization creates the opportunity for businesses to take advantage and exploit the ability to take part of their business to a different country. Nevertheless, globalization is part of today’s society and will be involved in virtually all situations.