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Power Crazy

Optimize Blog - March 17, 2011 - 0 comments

During the BP Gulf of Mexico crisis we wrote a couple of blogs around communication and the leadership handling of the media and key stakeholders. We were critical of BP’s approach particularly around understanding the leadership risks and in perhaps believing that history and status in the business community would somehow provide some form of defence to some frankly incompetent behaviour.
As Japan struggles with its current nuclear crisis, seen on a par with the Three Mile Island reactor meltdown in the US in 1979, we see evidence yet again of a large corporate failing to grasp the seriousness of poor communication and the covering up of previous safety lapses.
The corporate in question is the Tokyo Electric Power Company (TEPCO) which is the largest power utility in Japan and ranks as the world’s fourth largest commercial power utility – after three European operators: E.ON of Germany, Electricite de France and Germany’s RWE.
Last year, TEPCO made a profit of 134bn yen ($1.66bn, at current exchange rates) on a turnover of 5 trillion yen ($62bn). TEPCO was one of nine Japanese regional electricity providers set up in 1951. It is one of the world’s most experienced operators of nuclear power stations. Electricity generation began at the Fukushima complex, scene of the current crisis, in March 1970.
TEPCO has a chequered history in divulging information about its nuclear operations and in 2002 it was accused of false reporting and of concealing information about safety lapses over many years. Further revelations of past concealment emerged five years later. Japanese Prime Minister Naoto Kan is said to be among the critics. He was furious on Tuesday when the company apparently failed to inform him of an important development, a new fire breaking out at one of the affected nuclear plants, until an hour after it happened – sound familiar?
BP suffered a huge loss to its prestige, lost its chief executive and put $40.9bn aside for charges relating to the giant oil spill in the Gulf of Mexico. TEPCO has lost half its market value since Friday.
While there are substantial cultural and technical differences between the US Gulf spill and the current incident in Japan there are many similarities and lessons to be learned. Talking safety and stakeholder management is one thing – living it is quite another.
One thing we like to remind clients of regularly is to trust action not words. Make sure your vision of what you want to be and the claims that you make are actually the reality…..

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