Exxon Valdez Case Study

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The Exxon Valdez oil spill occurred in Prince William Sound, Alaska, on March 24, 1989. The Exxon Valdez, an oil tanker bound for Long Beach, California, departed from the Trans Alaska Pipeline terminal at 9:12 pm March 23, 1989. William Murphy, an expert ship's pilot hired to maneuver the 986-foot vessel through the Valdez Narrows, was in control of the wheelhouse. At his side was the captain of the vessel, Joe Hazelwood. Helmsman Harry Claar was steering. After passing through Valdez Narrows, pilot Murphy left the vessel and Captain Hazelwood took over the wheelhouse. The Exxon Valdez encountered icebergs in the shipping lanes and Captain Hazelwood ordered Claar to take the Exxon Valdez out of the shipping lanes to go around the icebergs. He then handed over control of the wheelhouse to Third Mate Gregory Cousins with precise instructions to turn back into the shipping lanes when the tanker reached a certain point. At that time, Claar was replaced by Helmsman Robert Kagan. For reasons that remain unclear, Cousins and Kagan failed to make the turn back into the shipping lanes and the ship ran aground on Bligh Reef at 12:04 am. Captain Hazelwood was in his quarters at the time.

The captain was seen in a local bar, admitted to having some alcoholic drinks, and a blood test showed alcohol in his blood even several hours after the accident. Hazelwood remained insistent, however, that he was not impaired by alcohol. The oil tanker spilled approximately 11 million gallons, or 257,000 barrels, of crude oil. It is considered to be one of the most devastating human-caused environmental disasters. The Valdez spill was the largest ever in U.S. waters until the 2010 Deepwater Horizon oil spill (more commonly known as the BP oil spill), in terms of volume released. However, Prince William Sound's remote location, accessible only by helicopter, plane, and boat, made government and industry response efforts difficult and severely taxed existing plans for response. The region is a habitat for salmon, sea otters, seals and seabirds. The oil eventually impacted 1,300 miles of shoreline and 11,000 square miles of ocean. Then Exxon CEO, Lawrence G. Rawl, shaped the company's response. Many problems can be found with how the company handled the crisis. There was a two-week delay before clean up even began, and for the first few days the CEO refused to be interviewed. After six days, Rawl finally made a statement to the media and eventually went on TV, but he was unfamiliar with the latest Exxon cleanup plans. He also claimed that, as CEO, it was not his responsibility to read such reports and blamed the media for making a big deal of the spill. After more than two weeks, Rawl finally visited the site of the oil spill. Another troubling issue was that Exxon’s claims were contradicted by eyewitness accounts. The key issue presented in the Exxon Valdez case study is that Exxon communicated in an unethical manner when its crisis contingency plan failed (McGill & Seeger, 2000, p.177). Inadequate communication, along with the absence of an effective plan, minimizes trust. This is exactly what oil companies need to avoid if they want to uphold a respectable company image. Companies that work with highly toxic substances often have spills that can be seen as normal accidents (Cleveland, 2008, par.1). However, if “the company is ill-prepared to handle the situation, it becomes a considerable crisis” (Waddock, 2008, p.23). The crisis worsens when companies provide false statements and does not take responsibility for their actions. When the Exxon Valdez spilled millions of gallons of oil into Alaska’s Prince Williams Sound, Exxon management blamed the Alaskan Coast Guard and the captain of the tanker for the failure of the crisis contingency plan (Cleveland, 2008, par.1). Rawl also evaded any responsibility when addressing the crisis in the media. The plan did not fail because of irresponsible stakeholders; it failed because Exxon management had...
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