Deepwater Horizon Case Study: Management and Knowledge Analysis

This report provides a comprehensive analysis of the Deepwater Horizon case study, focusing on the project's failure and the application of management concepts. The report begins with an introduction to complex project management and highlights the importance of adaptability, communicatio...Read More

Running head: DEEPWATER HORIZON CASE STUDY
Deepwater Horizon Case Study
Name of the Student
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Author’s Note:

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DEEPWATER HORIZON CASE STUDY
1. Introduction
A complex project can be difficult for few reasons like cost and performance and
there are few indicators that surround with unpredictability (Hayes & Bennett, 2011). These
indicators involve inclusion of several teams and stakeholders, project timeline, restraints or
budget and numerous moving parts. The management of a complex project needs few skills
like adaptability, communication, leadership, expertise and collaboration (Cooke-Davies,
2011). Each of these above mentioned skills is required to be fulfilled for better management
of this project. It is essential that project management can effectively convey the mission,
vision, issues and goals to produce accurate results (Ahern, Leavy & Byrne, 2014). Visibility
is created and flexibility is maintained for management of complex project (Williams, 2013).
The following report outlines a brief discussion on management of the popular case study,
Deepwater Horizon.
2. Discussion
2.1 Part 1: Development of Project for Learning
Deepwater Horizon rig was an oil drilling rig that sank in the Gulf of Mexico on 22nd
April 2010. The incident occurred after two days of Macondo well blowout and explosion. 11
workers were killed in the explosion and the entire project became a major failure. It is
considered as one of the largest oil spill and environmental disaster in the history of United
States (See Appendix).
2.2 Part 2: Reviewing Concepts and Theories
Diamond Model
For analysing the case study of Deepwater Horizon, few models can be utilized. One
of such significant model is Diamond model (Nail, Di Domenico & MacDonald, 2013).
Diamond model is a diamond shaped framework that majorly focuses on explanation of any
particular case study or project in respect to four significant aspects of technology,
complexity, novelty and pace (Fuchs & Sandoval, 2013). This model states that a complex
project can only be managed when it is striving novelty, dealing with the technological
uncertainties, competing on pace and finally coping with project complexities. A project can
take place in any industry and can be aimed at different markets by using different
technologies. Every project comprises of certain requirements for succeeding, however there
are situations when projects become failure (Kharub & Sharma, 2017). The common theme
for this type of failure is the identification of complexity or uncertainty involved. For
addressing the differences amongst projects, this diamond shaped framework is being offered
for helping the project managers to distinguish amongst projects as per four dimensions of
technology, complexity, novelty and pace (Teixeira & Pereira, 2015). The diamond is being
designed for providing a disciplined and proper tool so that expected benefits as well as risks
are being analysed for the project. Moreover, this disciplined tool is also responsible for
developing a set of behaviours and rules for every type of project (Shenhar & Dvir, 2007).
This diamond analysis even helps in proper assessment of the project by identification of
every possible gap within the troubled project, hence selecting correct actions for putting the
project back into track.
The structure of this diamond model framework in respect to the case study of
Deepwater Horizon disaster is as follows:
i) Novelty: The first and the foremost dimension of this particular diamond model
framework is novelty (Carayannis, Sindakis & Walter, 2015). It defines about how new the
product is in the existing market. The dimension of novelty represents the limit until which

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the potential users or customers are quite familiar to the product type, method of using the
product and even the requirements and customer needs were defined upfront. This product
novelty involves three types, which include derivative, platform and breakthrough. These
three distinctive levels of product novelty are given below:
a) Derivative Products: This type of product is the improvement as well as extension
of the previously existing products within the organization (Nail, Di Domenico &
MacDonald, 2013).
b) Platform Products: These products are the new generations of existing products
and these products replace their previous products within a well established market sector
(Fuchs & Sandoval, 2013).
c) Breakthrough Products: This type of product is completely new as it is responsible
for transferring a newer concept or a newer idea into the most innovative product, which
customers have eventually never seen before (Kharub & Sharma, 2017).
ii) Technology: The most significant sources of this kind of task uncertainty within a
particular project are collectively termed as the respective technological uncertainties
(Teixeira & Pereira, 2015). This type of technological uncertainty has a major impact on
various things like communication as well as interactions, designing and testing, required
number of designing cycles and timing of designing freeze. It even affects the technical
competence that is required by the respective project manager or project members. The four
levels of technological uncertainty are given below:
a) Low Tech Projects: This type of project majorly relies on the previously existing
and well established technologies (Shenhar & Dvir, 2007). Construction projects are major
examples of these projects.
b) Medium Tech Projects: This type of project utilize majorly existing as well as base
technologies, however they incorporate a completely new technology, which do not exist in
any previous project.
c) High Tech Projects: This type of project eventually represents few situations where
maximum technologies that are being employed are innovative to the organization or sector
(Carayannis, Sindakis & Walter, 2015).
d) Super High Tech Projects: Finally, this type of project is based on the new
technologies that did not exist during initiation of the project work.
iii) Complexity: This particular dimension defines the complexity of the project. A
simple method to define the several complexity by using the hierarchical framework systems
(Fuchs & Sandoval, 2013). Project complexity is directly associated with scope of the system
and it highly affects formality of project management as well as the entire project. The three
significant and important levels of complexity that are being utilized for distinguishing
amongst the practices of project management are given below:
a) Assembly Projects: The assembly project includes proper creation of a set of
modules, components and elements that are being combined together into one single entity or
units, which is responsible for performing one particular functionality (Teixeira & Pereira,
2015).
b) System Projects: This type of project includes a complex set of few interactive sub
systems and elements that jointly perform several functionalities for fulfilling the operational
needs.

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c) Array Projects: This type of project deals with largely dispersed set of systems,
which work together for achieving the projects’ goals (Nail, Di Domenico & MacDonald,
2013).
iv) Pace: The final dimension of diamond model framework is pace. With this
dimension, a project differs by urgency and the four levels of pace are given below:
a) Regular Projects: This type of project is an effort, in which time is not important
for immediate project success (Carayannis, Sindakis & Walter, 2015).
b) Fast or Competitive Projects: This type of project is mainly carried out by profit
driven projects.
c) Time Critical Projects: A time critical project should be executed by any specified
date that is constrained by few opportunities.
d) Blitz Projects: Finally, a Blitz project is termed as a crisis project and solving the
crisis is as fast as possible is considered as the main criterion for success (Fuchs & Sandoval,
2013).
Regarding the project of Deepwater Horizon, this model has been selected as it is
extremely effective for project analysis (Nail, Di Domenico & MacDonald, 2013). This
project became unsuccessful due to mismanagement and improper decision making. The oil
drilling rig collapsed due to issue in their project plan. A two and half miles deep Macondo
well stranded the 33000 ton Deepwater Horizon centred (See Appendix). After analysing the
project with Diamond model framework, it is stated that it matched all the four dimensions.
As per novelty, this was the first time that such a huge project as become failure. Although,
the potential risks were high since testing was not completed here, due to innovativeness the
project could had been successful (Fuchs & Sandoval, 2013). The second dimension is
technology. There was technological uncertainty since the BP managers involved in
Deepwater Horizon project did not conduct cement testing and hence there was a failure in
equipment. It was a super tech project and the new technologies were not present during
starting of the project work on April 10, 2010 (Shenhar & Dvir, 2007). As per complexity
analysis, Deepwater Horizon project was a system project. It included creation of several
elements and modules for performing a single function of producing oil to the US market.
Finally, as per pace dimension, this particular project was time critical project that was
required to be completed within given constraints (Teixeira & Pereira, 2015). However, it
overshooted the budget and time to a high position.
Knowledge Management
Knowledge management in complex projects is extremely important and significant
for knowing about the current position of the project (Dalkir, 2013). There are three
distinctive segments of this knowledge management, which includes understanding of the
nature of knowledge, defining strategies for learning as well as knowledge transfer and
identification of knowledge sharing mechanisms (Hislop, Bosua & Helms, 2018). It is the
basic procedure by which creation, sharing, utilization and finally management of knowledge
and information within any organization. Most of the important and significant organizations
in the entire world have resources dedicated to the internal efforts of knowledge management
(Becerra-Fernandez & Sabherwal, 2014). They use as a core part of their business strategies,
human resource management and IT departments. The performances are improved and
competitive advantages are gained after implementation of knowledge management (Jones &
Sallis, 2013). There are two dimensions of knowledge, which are explicit and implicit.

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For this project of Deepwater Horizon, the strategies are required to be defined for
both learning and transferring of knowledge (Hansen, Nohria & Tierney, 1999). In this
particular concept, organizational analysis and knowledge analysis are both combined to
make a knowledge transfer strategy and when this strategy is executed, knowledge transfer
mechanism is obtained (Fernie et al., 2003). There are three areas for organizational analysis,
which include products or services, competitive capabilities and business areas. After
combining, these three areas of organizational analysis, either mostly codified or mostly tacit
type of knowledge is being obtained (Hislop, Bosua & Helms, 2018). Amongst the codified
and personalization strategies, the most suitable for the project of Deepwater Horizon is
personalization strategy. In this particular strategy, the main focus is provided on dialogue
within project members. The BP managers did not check the cement testing, which caused
crash of the entire oil drilling rig (Becerra-Fernandez & Sabherwal, 2014). They should have
undertaken brain storming sessions for collectively arriving at deeper insights by simply
going back and forth on the issues that are require to be resolved.
The managers of this particular project should have invested heavily on building
people network and could have listened to the workers at site (Jones & Sallis, 2013). For
identification of knowledge sharing mechanisms, there are few levels of learning, which
include individual learning, group learning and organizational learning. The learning and
knowledge transfer functions include knowledge absorption creation, knowledge sharing and
knowledge uses. The knowledge transfer function focuses on primary knowledge activities to
gain learning levels. The experience accumulation could be done by on-the-job training, job
rotation, specialization and re-use of experts. The managers of Deepwater Horizon did not
focus on knowledge sharing and hence experience was not accumulated. Moreover, since
they had to complete the project as early as possible, they did not share the knowledge of
project entirely with workers and this created a major issue. After combining KM strategies
with the Diamond model framework, it was noted that personalization strategy amalgamated
with technology and project complexity. As the project was a system technological project
and time critical in nature, it was extremely important to implement the personalization
strategy so that they were able to identify the gaps beforehand and hence reducing the
chances of project failure to a high level (Hansen, Nohria & Tierney, 1999). Thus, the
selection of KM strategies and Diamond model framework was justified for this particular
project of Deepwater Horizon.
3. Conclusion
Therefore, it can be concluded that it is extremely important to manage any complex
project. It is the practice of initiation, planning, execution, controlling and finally closing of
the team work for achieving few goals and then meeting success criteria at the specified time.
The main challenge of complex project management is achieving each and every project goal
in provided constraints. The primary constraints include budget, quality, time and scope. The
secondary challenge of complex project management is to optimize the overall allocation of
necessary inputs, before applying them to meet the previously defined objectives. The above
provided report has clearly outlined a detailed analysis of the Deepwater Horizon case study.
Two themes of knowledge management and Diamond model are undertaken for
understanding and analysing the entire case study with proper effectiveness. The main
arguments, tensions, challenges and strengths and weaknesses of the theories and concepts
are being explained in this report properly.

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References
Hayes, S. & Bennett, D. (2011) Managing projects with high complexity.
Ahern, T., Leavy, B., & Byrne, P. J. (2014). Complex project management as complex
problem solving: A distributed knowledge management perspective. International
Journal of Project Management, 32(8), 1371-1381.
Williams, T. M. (Ed.). (2013). Managing and modelling complex projects (Vol. 17).
Springer.
Nail, P. R., Di Domenico, S. I., & MacDonald, G. (2013). Proposal of a double diamond
model of social response. Review of General Psychology, 17(1), 1-19.
Fuchs, C., & Sandoval, M. (2013). The diamond model of open access publishing: Why
policy makers, scholars, universities, libraries, labour unions and the publishing world
need to take non-commercial, non-profit open access serious. TripleC:
Communication, capitalism & critique, 11(2), 428-443.
Kharub, M., & Sharma, R. (2017). Comparative analyses of competitive advantage using
Porter diamond model (the case of MSMEs in Himachal Pradesh). Competitiveness
Review: An International Business Journal, 27(2), 132-160.
Teixeira, C. S. B., & Pereira, L. L. F. (2015). Pereira Diamond: benefits management
framework. The International Journal of Business & Management, 3(3), 47.
Shenhar, A. J., & Dvir, D. (2007). Reinventing project management: the diamond approach
to successful growth and innovation. Harvard Business Review Press.
Carayannis, E. G., Sindakis, S., & Walter, C. (2015). Business model innovation as lever of
organizational sustainability. The Journal of Technology Transfer, 40(1), 85-104.
Dalkir, K. (2013). Knowledge management in theory and practice. Routledge.
Hislop, D., Bosua, R., & Helms, R. (2018). Knowledge management in organizations: A
critical introduction. Oxford University Press.
Becerra-Fernandez, I., & Sabherwal, R. (2014). Knowledge management: Systems and
processes. Routledge.
Jones, G., & Sallis, E. (2013). Knowledge management in education: Enhancing learning &
education. Routledge.
Hansen, M. T., Nohria, N., & Tierney, T. (1999). What’s your strategy for managing
knowledge. The knowledge management yearbook 2000–2001, 77(2), 106-116.
Fernie, S., Green, S. D., Weller, S. J., & Newcombe, R. (2003). Knowledge sharing: context,
confusion and controversy. International journal of project management, 21(3), 177-
187.
Cooke-Davies, T. (2011, August). Aspects of complexity: Managing projects in a complex
world. Project Management Institute.

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Appendix
1. Description of Main Characteristics of the project in terms of People, Technology,
Resources and Institutions
Deepwater Horizon project was one of the most significant projects for oil drilling.
On 20th April, 2010, a Halliburton Company cementing engineer eventually sent an email
from oil drilling rig, Deepwater Horizon within Gulf of Mexico to his colleague in Houston.
The four decks were floating on massive pontoons. The oil derrick rose over 20 stories above
the top deck and on the bridge of the main deck, two officers were given the responsibility to
monitor satellite guided dynamic positioning system. They controlled thrusters powerfully so
that the 33000 ton Deepwater Horizon remain centred on the Macondo well even in high
tides. While drilling the two and a half mile deep Macondo well, the engineers had to change
their plans by responding to the increasing knowledge of precise characteristics of the
geologic formations thousands of feet below.
Brian Morel was the BP drilling engineer who had designed this Macondo well with
few other engineers from BP like Mark Hafle. He was present on board for observing the
final stages of work at the well. On April 20th, Morel declared that the final cement job at
Macondo well has gone fine and for ensuring this job, a Schlumberger team of three men
scheduled to fly out to the rig for performing few tests and testing the new bottom cement
seal. However, for saving time and $128,000 fee, the team of BP skipped Schlumberger’s
cement evaluation. After meeting with the team, the crew decided to have a positive pressure
test for reassuring success of the project. As soon as the test was successful, the drilling crew
then prepared to set a cement plug56 deep within the well, 3000 feet below. However, the test
failed and mud and seawater blowed everywhere. People panicked and jumped into the sea
for saving their lives. This resulted into a major failure of the project and finally sinking of
Deepwater Horizon. Total of eleven workers were killed in this incident and explosion
including few significant stakeholders of the project. Finally, next day, rescue boats came to
save the lives of remaining 99 survivors.
2. Expectations of People from the Project in terms of Cost, Time and Performance
People at the United States and Mexico had major expectations from the project of
Deepwater Horizon. The first and the foremost expectation from this project was alternative
energy sources. Since, it is highly required to save renewable energy to a major level, often
lack of feasibility continues in facing the advent of this type of energy. The second
expectation of this project of Deep water Horizon was direct effect on the marine
environment. It is crucial to note that oil spills can be extremely vulnerable for the marine
ecology and hence this type of project can easily eradicate such complexities and issues. The
extraction oil spills have even dwindled in both magnitude and frequency. Better
consumption of oil is yet another expectation of people. Oil transportation has improvised to
the most advanced level of transportation to their users. In respect to cost, time and
performance, it was highly expected that the project of Deep water Horizon will be
completed within time and will not overshoot the budget under any circumstance. Moreover,
the performance was also expected to be on top position without any type of issue. The
renewable energy resources were expected to provide better effectiveness to the United States
and Mexico.
3. Real Outcomes of the Project
Although, people had such expectations from the project of Deepwater Horizon, this
particular project became a major failure and is being considered as one of the largest oil spill

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disaster in the history of the United States. After investigation of the disaster of Deep water
horizon, it was noted that a cement bond log or CBL test was not conducted. After
identification of complexity level of a project, it is required to utilize skills for tackling or
managing the work. This resulted in failure of equipment by triggering of a massive blowout.
Due to the mismanagement of this project, major causalities were suffered. While executing
the drilling of the Macondo well within the respective Mississippi Canyon Block 252, the
MOEX USA and the Anadarko Petroleum, had as per the government reports, estimated the
budget of 96.2 million US dollars and then depicted that 51 days of project work was needed
for completing the detailed works of Deep water Horizon. Within 20th April of 2010, it was
observed that the Macondo well as well as the organization of BP were more than 6 weeks
late from the original project schedule. Moreover, more than 58 million US dollars were
incurred with their original estimated budget. Hence, the total budget was over shooted
highly. Furthermore, regarding performance, the project became a major failure, killing 11
people and injuring and killing several marine environmental species. Thus, this project did
not match people’s expectations under any condition.
4. Differences between Expected and Real Outcomes
Yes, there were several differences between the expected and real outcomes. One of
the major difference is that since in the field of oil drilling, more than 1550 injuries and
deaths have occurred in the Gulf of Mexico, it was highly expected that this particular project
of Deepwater Horizon will be resolving all types of complexities. However, no such
advantage was provided and expectation was fulfilled. The next difference was that it was
expected to be completed within time and previously determined budget, however, both time
and budget over shooted according to governmental records. Another important difference
was that this project was expected to be made in such a manner that the marine species do not
have any issue while living in the sea. However, this project suffered major casualties and
apart from the project or crew members, several marine species were killed due to fire and oil
spill. This hence resulted into a major failure of the project and is still considered as the
largest oil spill disaster in the history of the United States. Thus, the expected and real
outcomes did not match at any cost and the executed project was extremely vulnerable for the
society.
5. Project Initiator and Reason for Initiating the Project
The project initiator is the person, who is responsible for starting the project. This
initiator along with the stakeholders selects a project manager and then authorizes the person.
He even has the responsibility to task with the overall funding of project consumption of
resources during initiation. The project of Deepwater Horizon was initiated by BP and the
operator was Transocean. It was initiated for bringing out oil in a smoother manner and also
for producing several profits and advantages to the oil sector of Mexico and the United
States. The project members and project managers were responsible to make the project of
Deepwater Horizon a successful one. However, this project was a disaster and management
of BP was charged for killing people.
6. Main Stakeholders of the Project
Stakeholders are individuals or a group of people, who have interests or concerns
within an organization or project. They could either affect or could even be affected by the
various policies, objectives and actions of the company. The main and the most significant
stakeholders of this project of Deepwater Horizon were Halliburton engineer, BP drilling
engineer, Brian Model, who had designed the Macondo well, Robert Kaluza, day shift
company man of BP, Douglas Brown, chief mechanic, managers of Transocean, Captain

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Kutcha, Vidrine and every project member or worker, who was associated with this project
work.