Exxon Valdez Spill Case Study Summary

Di (Jennifer) Jiang

COMM642

Summer 2011

Exxon Valdez Spill

Background

Exxon was one of the five largest companies among the worldwide energy industries in theUnited States. The two main product of Exxon are oil and gas because the company purposes to improve living standards by providing energy to the growing world. There are three brands evolved form the past 125 years, which are Exxon, Esso, and Mobil. Those three brands are separately providing services for the different regions, for example, the customers of Exxon are mostly in the United States, Esso’s customer are around the world, and the Mobil focus on its advanced technology in fuels, lubricants and services. In this case, Exxon is the protagonist for the oil spill in March 24, 1989.

Problem

The crisis happened in March 24, 1989, a 987-foot oil supertanker which was named Exxon Valdez had run aground on the rocks of Bligh Reef, and then the oil spilled inPrince William Sound. The most important reason is the captain Joseph Hazelwood’s went off duty, his credentials and skills were highly praised but he was intoxicated when operating the tanker. The water no longer beautiful, the sea life was in danger, and the sea recovery from the oil spill is hard. Besides that, the image of public was destroyed, so the company should to deal with the public relationship and the spill crisis.

Situation (SWOT) Analysis

From the textbook, we can find that crisis management is a process of planning strategic for removing a crisis or negative occurrence. In order to make a new strategy to deal with this company’s spill crisis, we can use the SWOT methods analysis on it at first.

Strength

In the strength part, by handing this event, we can figure out that this company is a well-known energy company in the world. The strengths of Exxon Corporation are their very perfect logistics system and operation measures,which was based on their strong economic strength .For instance, they can immediately set up animal rescue project, their efforts to clean up the work of pollution and agreed to take responsibility for most of the cost. Even though it is in a serious trouble, they still have enough materials and financial supports to handle this crisis, and make the damage to a minimal level. 

Weakness

According to the text book, we can discern that there are some weaknesses for Exxon Company during the crisis period. On the one hand, the CEO of Exxon who was named Lawrence G. Rawl dislike publicity and the media. Therefore, they didn’t do a good job to deal with the oil spill crisis by using the media, for example, the delay of apology to the public, and didn’t establish an effective national news center. Instead, only one news center was built inValdez,Alaska.

On the other hand, the CEO Lawrence G. Rawl wasn’t showing up at the Prince William Sound timely, compared with the CEO of Ashland Oil’s John R. Hall present himself immediately when the Oil penetration events happened in early 1989 and the solutions of Union Carbide when malignant explosion in a subsidiary of the region in Bhopal, India. This CEO’s behavior makes customer feel that the Exxon Company lacks of responsibility for this disaster.

Moreover, Exxon’s corporate culture also showed the weakness of this company on the management ability, for instance, in order to save money the company had downsizing so the crews worked long hours and didn’t get enough sleep. To some extent, the employee’s fatigue was responsible for the spill accident.  

Opportunity

After the analysis on the strength and weakness of Exxon Corporation in handling this event, we can find out the opportunities of this company faced was that, the disaster on Good Friday offered a very good opposite materials that can call up the alarm of the managers for which all class can unite in a concerted effort to built a perfect crisis prevention and crisis management system. Furthermore, by handing this event, the company can show the public its strong ability on crisis management. The last but not the least, worked through the crisis improved enterprise’s cohesive force.

Threat

According to the crisis materials form the internet and news, we can discern that how does the public judge the image of company is essential for the following recovery process, as an illustration, whether the Chairman of the Board of that company went to the accident scene immediately, and issued effective measures on the news center and so on. Another threat came from the government for ordered the company to control the environment pollution caused by this accident. Also the competitive enterprise used this crisis to built their own enterprise image on the aspects of risk prevention and environmental protection

 

Strategies

After the crisis happened, there were a series of strategies were issued. At first, Don Cornet became the public relations manager of Exxon, and Frank Iarossi became the president of Exxon shipping as well as the Exxon’s main representative at theValdezsite. Besides that, a media center was set up inValdezin order to communicate to the public immediately. Secondly, the CEO of Exxon decided didn’t fly toPrince William Soundto take care the crisis even just to rescue sea birds by himself. Third, for future developing sake, the implement strategies of three areas was asked by Cornet to Mason, which were the tourism industry, the animal rescue centers, and the seafood industry. Finally, for restoring tourism part, the crisis plan involved telephone hotline and bring travel writers toAlaskain order to provide information swiftly.

Consequences

Since the lack of equipment, facilities, and accommodations in a remote town inValdez, the communication to the public about the situation of crisis usually delayed. The statement about the seriousness of the crisis was usually contradictory and confused, sometimes; it is because of the time difference or the lack of the equipment. According to my own research on the Exxon Valdez Spill, the decision of stay atNew Yorkby Lawrence G. Rawl is shortsighted, and the delay of apology didn’t make the public calm down and call up public’s confidence.

The animal rescue centers inValdezwere aims to rescue injured birds and protect the animals, and then the public and interested community people were cooperated with the rescue centers. Even though the result was impossible, the purpose here still is in an effort to rescue wildlife meanwhile to build a positive relationship between Exxon and community. As for the restoring tourism, an advertising campaign developed successfully to diffuse negative travel publicity.

Comments

In my opinion, the Exxon Company didn’t do a good job in dealing with the public relations during the crucial period. Crisis communication is the dialog between the company and its public during the whole crisis period, and the essential role of news media is to change and affect public opinion. Therefore, building a positive relationship between the organization and media can help the company to come through crisis in time, meanwhile, persuading public in order to maintain and restore a positive image. Moreover, the important thing when encountering a crisis is to offer an apology through the media, and to be honest to public.

As the first trust organization inU.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, and then coordinating effectively with the media and disseminating useful information to the public are crucial for renewing reputation and recovering.  

 

 

 

 

 

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5 Responses to Exxon Valdez Spill Case Study Summary

  1. krmorel2 says:

    “Crisis communication is the dialog between the company and its public during the whole crisis period, and the essential role of news media is to change and affect public opinion.” Exxon clearly did not understand the meaning of crisis communication. The CEO was missing, and other spokespeople would not tell the media anything. They had a lot to learn and needed a crisis plan in their time of difficulty.

    • dijiang313 says:

      I agree with you, I think building a positive relationship between the organization and media can help the company to come through crisis in time, meanwhile, persuading public in order to maintain and restore a positive image.

  2. duanyafan says:

    “Crisis communication is the dialog between the company and its public during the whole crisis period.” Exxon didn’t know this at that time, CEO of Exxon didn’t go to the town at first time, ant tried to hide the truth. That really made people feel sorry about Exxon. From this case, we can know crisis communication is so important for a company.

    • dijiang313 says:

      In my opinion, the Exxon Company didn’t do a good job in dealing with the public relations during the crucial period. The essential role of news media is to change and affect public opinion. Therefore, building a positive relationship between the organization and media can help the company to come through crisis in time,

  3. Clark Feng says:

    I think that a positive relationship between media and organizations is good for the development of companies. at the same time, this term is worth paying attention to do with any problems for organizations.

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