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Taking a slicker approach
30/06/2007 | Channel:
Technology, Exploration & Production, Support Services
SIX RECRUITMENT’S JAMES BEAZLEY EXPLAINS WHY O&G COMPANIES ARE SERIOUSLY LAGGING BEHIND OTHER SECTORS IN PROMOTING EFFECTIVE RECRUITMENT POLICIES
Up until about 30 years ago, the wealth of the oil and gas markets presented companies in this industry with a significant advantage during recruitment. Companies had the financial resources to attract high calibre employees and retain them for long periods by offering substantial salaries, bonuses, pensions and share schemes. Similarly, attractive relocation packages could be offered to employees and their families to help encourage the transfer of expertise to different continents.
In addition to financial pulling power, oil and gas companies were among the first businesses to become truly global entities. This brought with it new opportunities for employees to travel the world working in different countries and job roles, but for the same employer. Employees were faced with an exciting new prospect of long term job security without the risk of becoming stuck in a rut.
Globalisation strengthened public awareness of the industry’s leading companies and perpetuated a positive reputation positioning them as world class employers. Jobs with companies such as Shell and BP became synonymous with terms such as ‘well paid’, ‘plenty of prospects’ and ‘a job for life’.
These factors promoted oil and gas companies to number one in the employment stakes. People wanted to work for the big companies and proudly boasted who their employers were. Essentially, oil and gas companies did not have to invest much in recruitment as talent found them instead of having to be spotted.
Holding on to the past
The oil and gas markets still rank among the most profitable and lucrative in the world, and their leading players are still highly respected as world class employers. However, other sectors have boomed during the last three decades and the number of multinational corporations has soared.
Leading companies from sectors such as engineering, manufacturing, transportation, finance, retail and marketing now have the resources to attract and retain the best recruits too. As companies in these sectors emerged, they did not have the luxury of monopolising the recruitment market.
In complete contrast to the rise of oil and gas multinationals, these new corporations were not just competing with rivals from their industry during recruitment. They had to contend with a whole host of companies from a diverse range of sectors. This intense competition encouraged the new multinationals to hone their recruitment practices to successfully attract the right applicants.
Major companies from outside the oil and gas sectors have continued to invest vast sums in developing recruitment practices. This includes marketing and communication as well as search and selection methods.
The vast majority of graduates have non-vocational degrees and can apply their knowledge to roles in a variety of sectors. Oil and gas companies are now competing with multinationals from other sectors for the best graduates and are losing out.
Companies throughout the oil and gas industry have failed to address recruitment as a key operational matter as it has never been a concern. As a result, companies have become complacent and are getting left behind.
An age-old story
As oil and gas companies are such good employers, it is only now that poor recruitment threatens to cause any real issues. Many young employees who joined oil and gas companies 20 or 30 years ago will have grown with the industry. There is also a generation of highly skilled, senior management level workers aged around 45+ willing to move into the industry from services companies. They appreciate the financial benefits that are offered, relish the chance to take on new challenges and still feel a sense of satisfaction to work for globally renowned companies such as Shell.
This has and is creating an ageing work force and an ageist approach towards recruitment where young people are discriminated against. The industry is reaching a dangerous point where much of its workforce could retire within a relatively short period of time, even despite an extension of retirement ages. This will create a void of specialist skills and expertise, and in turn, could cause billion dollar projects to be put on hold while new people complete training programmes. In an industry where uptime is pivotal to the bottom line, this is not a viable option and could lead to financial ruin.
Oil and gas employers are too fixed on the significance of age during recruitment. Many companies, although they may not be aware of it, are actually violating age discrimination laws and risk facing costly cases of litigation. Some employers wrongly perceive age as the only measure of experience and capabilities. Although oil and gas industry work has potential for near or fatal occupational hazards and years of experience is a definitely an advantage, younger players from service companies who relish the opportunity to work for an operator and already have a solid grounding in the industry, are just as viable. As it stands, applicants younger than 35 years old will either struggle to get an interview or be seriously disadvantaged before they even meet interviewers.
Companies are missing out on the fresh, new thinking that does not always come with age and experience. Just because a younger applicant has not spent 30 years in the field conducting pipe stress calculations or drilling in the harshest of climates, it does not mean that they can not offer solutions for improving working practices.
Oil and gas companies also need to be careful that they do not dismiss applicants because of gender. Like many heavy industries, oil and gas is predominantly male dominated, but this should not cloud employer judgement during recruitment. Similar to the perception of age, it can be easy for female applicants to be overlooked as employers do not feel they are capable. Change is starting to take place and some of the larger operators like Shell and BP have very targeted initiatives to attract and retain female recruits.
Oil and gas employers are making a fundamental mistake during recruitment – they still believe that it is purely a ‘buying’ process. In an increasingly competitive market where the best applicants are demanding more, companies can not just rely on brand power alone. They must sell their company to potential employees from the very start of the recruitment programme. Applicants will consider how they are treated by a prospective employer from the moment they make the first phone call and take every aspect of the job application into account.
In the vast majority of cases, it is taking oil and gas companies too long to respond to applicants. To make matters worse, proactive applicants who make the effort to follow-up with prospective employers will be sent on wild goose chases, lured with empty promises or met with walls of silence.
Companies can not afford to be this lapse when it comes to recruitment. They are damaging their own reputations as employers and diminishing the appeal of working in the industry. Word-of-mouth is extremely effective in rapidly communicating bad recruitment experiences. As a result, oil and gas companies are quickly becoming tarnished as arrogant time wasters.
Highly skilled and talented individuals are more interested in pursuing employment opportunities in sectors that take a professional approach towards recruitment. They have confidence that they will be treated with respect and that their time and effort will be rewarded. Even if they are unsuccessful during a job application, they know that they can benefit from constructive appraisal of their overall performance.
Oil and gas companies need to take a consistent, structured and defined approach to recruitment. They should have systems in place to handle every job application, whether the applicant is successful or unsuccessful. Companies need to invest the time and resource in making sure that every applicant has a positive experience when interacting with their company.
The industry’s service companies realised the importance of good recruitment practices in the early 1990s. This can be seen in the average age of the workforce which is around 29-32 years old, compared to 51 years in the operations part of the sector. Service companies have recognised the need to sell the benefits of remuneration packages to prospective employees, listen to employee requirements and take a less insular approach towards individual skills, experience and attributes. They are viewing how applicants could fit within the whole company rather than just one particular role.
Service companies still have a long way to go to streamline their recruitment practices, but are showing a willingness to achieve this. Operators need to act now to ensure that they do not get left any further behind in the recruitment stakes. If they do not, they may have to face outsourcing even more to service companies, who will
undoubtedly capitalise on their shortcomings.
Shell were the first of the Super Majors to recognise this trend and now have in place a structured approach to both graduate and experienced hire recruitment. The other Super Majors and some of the larger independents are quickly closing the gap, even to the point of one Super Major having a HR director represented on the board.
There is no reason why oil and gas companies can not replicate their excellence in employment during recruitment. This will only be achieved by making recruitment a core part of their business strategies and will help protect company performance in the long-term.
James Beazley is a director of specialist oil, gas and energy recruitment consultancy Six Recruitment. Six helps organisations to attract, recruit and retain the best talent in the industry.
For further information please visit: www.sixrecruitment.co.uk