The Spinning Globe Inside a Crystal Ball: A Dual Perspective on the Changing Leadership Demands of Oil and Gas

Abstract

Talent & Technology The stakes in the leadership-development game are increasing. Current trends in the oil and gas industry demand an expanded set of leadership competencies to handle the complexities of the immediate. And, at the same time, industry leaders are called on to prepare for broader macroeconomic trends that will reshape the landscape over the next century. Think of it as a split perspective on the future—one eye on the spinning globe of today and the other on a crystal ball within which it is spinning. This dual perspective suggests that the future demands of industry leadership will bear little resemblance to those of today. The newest trends in management development help firms prepare for the demands of the long term as well as the immediate. Oil and gas executives well know the evolving challenges of the industry and their leadership implications. Significant among these are: Intensifying globalization—strategy must be crafted and implemented in a global context that accounts for new players and new markets in developing nations, national oil companies and multinational corporations, multiple world hubs, and a complex web of customer and supplier relationships. Business complexity—sourcing capital, valuing complex projects, maximizing the value of alliances, creating operational efficiencies by applying information technology and adapting lean manufacturing, clean energy. Multicultural and multigenerational workforce—aligning business goals with a broad spectrum of cultural norms that may clash with organizational norms while maintaining one’s own cultural authenticity, transferring knowledge from one generation to the next. Expanded risk—assessing financial and operational risk, using new energy risk-management tools, dealing with regulatory and social risks, everything from safety to accounting standards imposed by a wide variety of governments at local, national, international levels, and maintaining energy security. These complex industry challenges require success-oriented firms to develop leaders who can lead innovation and change, make critical decisions quickly that align with overall strategy, achieve operational efficiency and economy, and inspire and motivate others. As one chief executive officer put it, his biggest challenge is developing leaders who can lead people, make money, and grow strategically. Today’s leader layers strategic thinking on top of business acumen on top of organizational and interpersonal savvy. This is the human capital equivalent of using multiple—even redundant—tools to maintain safe and secure levels of financial liquidity.