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Simon Fahie, managing director, EMEA at IQNavigator, discusses how the oil and gas sector manages talent despite facing volatile headwinds
The oil and gas industry is notoriously volatile, reflected in the constant price fluctuations seen within the commodity markets. This volatility has shaped the industry, requiring it remains flexible and reactive in all areas of business, particularly when it comes to managing talent.
When the price of commodities such as oil decreases, as we have seen over the past 12 months, companies must respond quickly to reduce costs and ensure they are not investing money, time and resources in projects that have become unprofitable. This usually leads to redundancies and the shutting down of project sites. But when the price of oil increases, the same companies must be able to react quickly to recruit, often skilled, in-demand field workers in geographically challenging areas. With expensive machinery sitting around waiting for operators, time-to-fill is a costly issue.
Another challenge facing the industry is its ageing workforce. Many so-called ‘baby boomers’ are retiring and taking their wealth of knowledge and skills with them. Backfilling these positions with millennials, those born in the 80s and 90s, isn’t easy. For a new generation, doing tough work in remote locations under difficult environmental conditions isn’t very enticing, particularly when big-name brands such as Apple and Google are offering exciting, well-paid roles for talented new recruits in plush offices.
When it comes to new talent, the oil and gas industry does not have a great track record of attracting young recruits either – particularly females. But this is also changing and the industry is reaching out to the growing number of students studying science, technology, engineering and maths. Companies such as Shell and ExxonMobil were at this year’s Big Bang Fair, for example, to get the message across that theindustry is an exciting place to work with many opportunities including competitive salaries, travel and transferable skills.
This makes recruitment and retention a particular headache for procurement and HR professionals in the industry. The question they have been asking themselves is how do they tempt people back when times are good if they have had to lay them off months or years previously?
Recruiting top talent
Good talent can be hard to find when you need it quickly, so companies in the industry are increasingly investing in talent pools and adopting new strategies to help source and retain the right workers to use them when they need them most.
New, young entrants are just one source of talent that can be captured in well-managed and integrated talent pools. Others could include previous employees and interviewees along with candidates who have submitted CVs directly or through channels such as referrals, job fairs, social media, etc. And, of course, there are those leavers or retirees who may be enticed back on a permanent or contingent basis.
A well-managed off-boarding procedure with an outreach programme to keep the lines of communication open means that talent heading out the door may be more inclined to remain in the talent pool for future opportunities.
Keeping good talent engaged
Like many industries, oil and gas also has to work harder at supporting, rewarding and retaining good people. Effective HR and line management are clearly important to the workforce, but so is flexibility. In fact, providing flexible working arrangements may benefit both parties. Some roles are only required half of the year and some skills are transferable to suit preferences. Mentoring and training are also important, particularly as changes in technology create new roles and opportunities.
The best managed talent pools capture and harness information that can be accessed easily and searched rapidly, delivering cost savings through shorter timeâ€toâ€fill and improved worker quality. They provide the flexibility to source both long- and short-term workers from a pool of pre-qualified and vetted candidates.
Many O&G companies such as Shell are using advanced vendor management systems to integrate talent pools and employee management processes into a total workforce management strategy. This approach also addresses issues such as compliance, paying the right money to the right people, and providing far greater visibility.
We can say with some certainty that volatility and the profit squeeze will continue in the industry over the next few decades. Recruiting and retaining top talent—both inside and outside of the business—will remain a key procurement and HR challenge that oil and gas companies must address to remain agile.
Simon Fahie, managing director, EMEA at IQNavigator
This contributed article has been written by a guest writer at the invitation of Procurement Leaders. Procurement Leaders received no payment directly connected with the publishing of this content.