The upstream oil and gas industry — specifically the deepwater sector — continually deals with issues related to recruitment and retention of quality employees. These issues require employers to think creatively about staff and how resources can best be deployed. Three strategies exist to help address critical workforce needs: talent identification and retention, cause and effect training, and re-population and bench-strength recruiting.

Talent ID and retention

Top grading. Grading human capital assets is becoming an increasingly important way to understand how best to use existing personnel to transfer knowledge from experienced staff to freshman hires. While teaming new hires with more tenured staff is a time-tested training method, the accelerating loss of senior personnel means training times must be condensed and improved. It is important to ensure freshmen hires are trained by those most capable of passing on information. This may mean removing those who are less skilled at training from the teaching system. While the most capable employees are typically chosen to mentor, the grading approach means focusing trainer selection primarily on one area: Can a prospective trainer answer the “Why” questions? Those with the ability to communicate why certain procedures exist excel as trainers.

Companies today are struggling with different strategies and techniques to retain their brightest employees. Dana Beebe, president and chief executive officer of DTC International Inc., stated, “It is increasingly difficult to retain current employees as we are now competing with our customers for the same talent pool.” As a small independent deepwater technology company, DTC must be more creative in its retention programs to compete with much larger companies. Companies similar to DTC cannot offer large signing bonuses, and while their salaries are industry-competitive, they are not always at the top of the spread. DTC offers a benefits package that is generally more favorable and offers the employee an opportunity to share in the success of the company by becoming an owner. Smaller companies must think outside the box and offer benefits that will help retain employees. Sometimes it is not always a larger paycheck but simple things like making your organization an enjoyable place to work.

With the increasing number of “baby boomers” nearing retirement age it is critical that companies implement specific programs to tap the knowledge of their older workers. The lack of recruitment done by the industry during the cyclical years of the 70s, 80s, and 90s, means the industry is facing a severe shortage of qualified personnel with 5 to 15 years of experience. This knowledge gap has to be overcome by the industry’s older workers continuing to share knowledge with new and less experienced employees.
Retiree return program. Like a misplaced tool, retirees are too often forgotten. The retiree pool should be constantly reviewed and invited to work. That said, a different set of employment rules and offers must be considered. Flexible work hours, reduced schedules, split-year schedules, and similar flexible employment options will help employers attract retirees.

Contracting with retirees can reduce other employment-related issues: Retirees are a known quantity, they come up to speed quickly, they tend to support positive working environments, and with the right hiring method they can easily be released once their assignment is complete. By writing the proper offer letter or assignment, contract employers can easily recruit workers who are quick to production and make low-management teammates. The feeling of freedom and control a retiree gains by cutting the employment relationship and forming a consulting agreement can benefit the company by offering continued access to their talent.

Cause-and-effect training

Increased emphasis on training and employee development impacts employee retention. Technology gains, equipment improvements, and their interaction have given companies the ability to add staff and assign new hires. With improved web-based training, investing in core function knowledge has become cost-effective. In-depth training to understand the processes involved should be a mandate for all new hires. Such training can mean keeping an employee long-term and maximizing performance. Taking an employee from a rote training reaction to visualizing whole processes will lead to improved individual and company output. The idea is to train employees to have a more comprehensive understanding of their own function and a more comprehensive understanding of the company systems and their interaction.

Larry Rogers, executive vice president with National Coupling Inc., shared his company’s thoughts on training, “We developed an in-house training program specifically for the most needed job skills — machinists. We cross-trained machinists to operate multiple types of machines, provided all tools and inspection equipment, air-conditioned the plant, and formed activities for morale boost.”

Exceptions training becomes the “next step” in advancing a new-hire toward becoming a skilled employee. This means adding the ability to think through critical, emergency, and production maximization events. An employee’s ability to understand the forces at work, immediately correct potentially hazardous conditions, and protect lives and equipment is a key factor in many operations.

Re-population andbench-strength recruiting

Intern programs are a good way to grow bench strength and add recruiting talent. Ongoing programs to add management and executive talent should be targeted at colleges and universities, and production-floor talent should be co-trained by trade schools and hiring organizations. In this way, potential long-term employees can be tested in actual working conditions, trained at reduced cost, easily culled if sub-par, and guided toward additional training. More importantly, the best potential employees identified through an internship can be “locked up” before competitors get a chance to target the talent. Investing in “home-grown” talent can produce intangible returns.

Rotating backup/fill-in hiring. Each of these strategies involves taking “investment in growth” dollars and converting them into “payroll” dollars. While the easy solution may be to add payroll expense, a more realistic approach is to invest in growth. Budgeting for and then hiring multi-functional replacement workers starts to build capability.

Staffing numbers should be built now to ensure that replacements are available. An easy program that can be implemented to support a company project includes hiring a team, placing it in a six-month training program shadowing senior personnel, and then transitioning team members into roles of full project responsibility. A company’s investment in this type of program is costly in the short term, but when high-quality talent is needed, they are fully trained and available for the next project. The long-term cost savings is significant. And the value of knowing that experienced workers are on staff before the build program begins is immeasurable.

Companies today are being forced to review the traditional recruitment models and look at new ways to attract top talent. The traditional methods of Internet job boards and newspaper advertising are not as effective in an industry that has a shortage of quality talent. Beebe states that “DTC hires employees that have been personally recommended to us by current employees, trusted business associates, friends, and colleagues.” This strategy greatly reduces the talent pool of candidates but has proven successful in providing a higher quality employee for DTC.

The use of industry-specific recruiters and consultants that have a proven track record in the industry is an effective tool in recruiting new employees. A proven network of contacts from years of working in the industry is critical to locating passive candidates for any opportunity.

Specific issues related to recruitment and retention of high-quality talent will be critical over the next several years as the oil and gas industry deals with
its aging workforce. For companies to continue to thrive they must develop unique and creative ways of attracting and retaining human capital that will allow their organization to continue to grow and prosper.