Exxon and the Valdez Oil Spill

Tasha Richmeier
Case Study 1: Exxon and the Valdez Oil Spill
6/23/2011

The oil company Exxon as well as Prince William Sound and the Alaskan town of Valdez experienced the Exxon Valdez Oil Spill. Exxon as well as everyone involved in this crisis including the citizens of Alaska as well as the people working with the oil company all felt the effects of this huge crisis. Exxon was a highly powerful oil company in the late 1980’s and was one of the five largest oil corporations in the United States. The CEO of Exxon, Lawrence G. Rawl, had been employed with Exxon for over 37 years and was considered a sound leader. The other two highly publicized people in this case were Captain Joseph Hazelwood and Third Mate Gregory Cousins. Hazelwood was known was a n extraordinary captain and was very experienced. Cousins was also known as qualified to take command of a ship but however was not experienced enough to handle a tricky maneuver such as the one needed to enter Prince William Sound.
The crisis that awaited Exxon on the night of March 24, 1989 would have never been expected. Captain Hazelwood had put the boat in to auto pilot just as the ship was nearing Prince William Sound, which is known for having a very deadly reef, Bligh Reef. Hazelwood instructed Third Mate Cousins to head toward the reef for 3 minutes and then turn, this however was a very complicated maneuver and Cousins did not execute it properly. This action resulted in a huge gash in the side of the oil tanker, almost the whole length of the ship. 11 million gallons of crude oil began spilling into the ocean, which was very abundant with wildlife at this time due to migration patterns. This oil spill is said to have killed millions of species of wildlife native to the Alaska area as well as ruining the landscape for centuries to come.
When evaluating this crisis it is very apparent there is lots of room for strengths, weaknesses, opportunity, and threat for this companies image. Some of the strengths I found included the implementation of Don Coret, and Frank Iarossi as interim public relations coordinators. Coret and Iarossi set up a crisis headquarters in Valdez, Alaska and used this station to begin relaying information to news media outlets. Coret and Iarossi’s main focus was the clean up effort, which I think is very admirable. In a time like that when your head is spinning and you are worried about the future of your company, you must realize your first priority is to fix what you have broken, or ruined. George Mason also became a huge leader in getting Exxon out of crisis and cleaning up the Alaksa area. The men had three main goals to re-establish the tourism industry, to help in animal rescue efforts, and also to help the seafood industry that was the second largest industry in Alaska. I think it is a huge strength that these three men were able to look at the situation and realize what their time would be best spent doing. Mason took charge of the animal recovery unit and began immediately setting up visits for media so that the news flow could be opened between the animal rescue efforts and the public. Exxon was also very successful at restoring tourism to Alaska. Exxon’s public relations department took pictures, and set up hotlines for people wanting to travel to the area. Exxon’s public relations department did such a good job tourism was up 5% that year from the year before.
While Exxon may have shown some strength they also had a lot of noticeable weaknesses. The ball was completely dropped by CEO Lawrence G. Rawl, who declined to visit or travel to Alaska until long after the oil spill had occurred. Rawl also never offered any apology or sympathy to the fisherman and citizens of Alaska for the disaster. Another weakness was that Exxon did not even have the proper equipment to clean up an oil spill of that magnitude until a full month after the spill. That is far too much time to be wasting and the damage had already been done far before that month. The location in Valdez where the crisis center was set up was also considered a weakness for this crisis management situation. Valdez had very limited resources and was pretty much in the middle of nowhere making it close to impossible for reporters to travel there and then relay information back to their offices. While some consider this a weakness others say Exxon had no other choice and the main headquarters needed to be set up on the site of the disaster.
The consequences of this disaster were very horrific in the beginning but the company seems to have fully recovered since then. Because of the lack of sympathy and apologies from the company and CEO the public and Alaskan citizens were all very upset at the time. Since then it seems the company has rebounded and has since been named a top Fortune 500 company and has also been increasing in profitability since the Exxon Valdez Oil Spill.
My thoughts are that Exxon should have admitted wrongdoing from the get go and apologized all over themselves to the citizens of Alaska as well as the entire public. This was a huge disaster and I believe it took far too long for Exxon to respond and for the mess to be cleaned up. The effects of this oil spill will be felt for centuries to come because of the loss of wildlife and detrimental effects to the beautiful landscape of Alaska. I believe in any crisis situation the responsible party needs to take full ownership of the situation, apologize, and also do whatever it takes for the mistake to be corrected.

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5 Responses to Exxon and the Valdez Oil Spill

  1. krmorel2 says:

    Exxon definitely should have taken responsibility right away, and the CEO should have been more involved with developing a crisis communications plan. Rather than shying away from the issue, he should have taken some initiative and proved to the community that he was doing something about fixing the problem. More companies may have shown greater support if Exxon had acted differently in the beginning stages of the crisis.

    • dijiang313 says:

      Obviously, as the first trust organization in U.S. and one of the biggest industry companies in the worldwide, building a perfect crisis prevention and crisis management system can reduce the response time and uncertainties when the crisis happened.

  2. lilly1989 says:

    “The ball was completely dropped by CEO Lawrence G. Rawl, who declined to visit or travel to Alaska until long after the oil spill had occurred. Rawl also never offered any apology or sympathy to the fisherman and citizens of Alaska for the disaster.” I strongly agree that the behaviors of CEO in Exxon did make everyone feel angry. I think it not only effect the weakness for the CEO himself and the company, it also a threat for the company to develop a long-term future. I am very surprise how this kind of manage idea keeps a company well operate.

  3. dijiang313 says:

    “The location in Valdez where the crisis center was set up was also considered a weakness for this crisis management situation.” I think Exxon Corporation didn’t establish an effective national news center. Instead, only one news center was built in Alaska. Since the lack of equipment, facilities, and accommodations in a remote town in Valdez, the communication to the public about the situation of crisis usually delayed. That’s why the statement about the seriousness of the crisis was usually contradictory and confused, and those weakness prolonged the period of recovery

  4. kurtcomm642 says:

    I think one of the lessons of crisis communications beginning perhaps with the Valdez and since is that the communications headquarters needs to be as close to the disaster site as possible. Otherwise, media questions from reporters on site cannot be addressed quickly enough. The more time that elapses, the more room for speculation. Next time you see a news story about some disaster, notice how quickly the speculation begins.

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