BRITISH PETROLEUM - Learning Organizatiion and Knowledge Management (Case Study)

A Framework of the BP Knowledge Management Methodology

A learning cycle – before, during and after any event – supported by simple process tools
The lessons arising from the learning loop are agreed and distilled by a community of practice – peers across the organization who have a stake in agreeing and defining BP's best practice.
The lessons – both specific and generic are incorporated into "Knowledge Assets" on the corporate intranet, where they represent a living focus for BP's experience around strategic and operational areas.

Action Plan for Competitive Learning

By: John Browne, CEO, British Petroleum

Anyone in the company who is not directly accountable for making a profit shall be involved in creating and distributing knowledge that the company can use to make a profit
Our philosophy is simple: Every time we do something, we should try to do it better than the last time
No matter where the knowledge come from, the key to reaping a big return is to leverage that knowledge by replicating it throughout the company so that each unit is not learning in isolation and reinventing the wheel
We must view relationships as a coming together that allows us to do something no other two parties can do, and that is make the pie bigger, to our mutual advantage

Dual Citizenship

The need to share and learn drives staff towards dual citizenship:

affiliated both to the business unit, and also
committed to a knowledge network of peers across the business units.

Co-evolving With Internal and External Players

Internally, the organization co-evolves with each business unit, department and function.
Externally, the organization co-evolves with its customers and suppliers.

Related Chapters

Knowledge Management (KM)

Learning Organization

Global Leader in Knowledge Management (KM)

British Petroleum has a worldwide reputation for commitment to knowledge management (KM).

The knowledge management methodology pioneered in BP's is encompassed by a simple framework, which describes a learning cycle – before, during and after any event – which is supported by simple process tools. The lessons arising from that learning loop are agreed and distilled by a community of practice. Finally, the lessons – both specific and generic are incorporated into "Knowledge Assets" on the corporate intranet.

Benefits

The business benefits of applying a consistent approach to knowledge management have been significant. BP business managers attributed hundreds of millions of dollars of added value as a direct result of using this approach.

A practical example of this has been in the cost reduction in the construction of European retail sites:

At the beginning of 1998 a challenge is set of reducing the build costs of retail sites in Europe by 10%. The Alliance (a joint venture between BP and Bovis) is responsible for the management of these activities in Europe. The Alliance was engaged in the benefits of knowledge management and invited the BP KM Team to help them achieve this outcome. Step change in costs was delivered in 1998 (savings of $74 million) due to the harvesting and sharing of knowledge between the project engineers in Europe. This gave BP Downstream Retail competitive advantage in the Mature European Marketplace. This knowledge is now also being leveraged on a global scale by project engineers in Venezuela, China, Poland, and Japan.³

Similar examples of increased performance have come from BP's KM application in speeding up business restructuring, developing new oil & gas fields, improving plant productivity and accelerating new retail market entry.

The Role of Top Leaderships

John Browne, CEO of British Petroleum is an outspoken enthusiast of the power of corporate learning. From his perspective, learning provides the catalyst and the intellectual resource to create a competitive advantage. "In order to generate extraordinary value for shareholders, a company has to learn better than its competitors and apply that knowledge throughout its businesses faster and more widely than they do. The way we see it, anyone in the organization who is not directly accountable for making a profit should be involved in creating and distributing knowledge that the company can use to make a profit," says John Browne.

Browne has developed an action plan for competitive corporate learning to spur changes in people's attitudes and ultimately formal and informal rules that govern the organization's behavior. "The wonderful thing about knowledge is that it is relatively inexpensive to replicate if you can capture it. Most activities or tasks are not onetime events. Whether it's drilling a well or conducting a transaction at a service station, we do the same things repeatedly. Our philosophy is fairly simple: Every time we do something again, we should do it better than the last time," says John Browne.

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