Engineered for success

Business success is, ultimately, about people and the skills that they bring to work. This was what American entrepreneur Mary Kay Ash was suggesting when she said, “A company is only as good as the people it keeps.” The significance of her statement is immediately apparent, but what does it mean for corporate resourcing strategies in the current economic climate?

For technology businesses it is clear that people who provide advanced knowledge of science, technology, engineering and mathematics (STEM) will make a crucial contribution to growth and continuing success. However, across the business world there have been suggestions that we are facing a shortage of STEM talent.

This raises the spectre of a reduced capacity for innovation and a skills-base limit on growth. Others suggest that the supply of STEM talent is in fact growing and that the key challenges for business organisations are finding and hanging on to it. Often, STEM talent is distant from the location that needs it; it is like oil that is found far away from its markets.

The downstream oil and gas sector has always been competitive, with refiners maintaining a strong focus on improving performance. This has implications for staff resourcing, as Süleyman Özmen, Vice President Refining and Chemical Licensing, Shell Global Solutions, explains: “If refiners want to sweat their existing assets, revamp processes or make major changes to plant hardware and operations, they usually have to find additional engineering skills and talent because staff at operating refineries rarely have time to look for radical improvements or more efficient ways to operate.

"It is the creativity and ingenuity of the engineers that will help refineries to cope with environmental legislation and to increase margins.”

Improving the performance of existing refineries is only part of the picture, as Özmen points out. “Skilled engineers are needed to help with designing, commissioning and starting up new refineries. In the Middle East and Asia, many new facilities are in the advanced stages of planning or close to start-up, and in China we have seen a new refinery or petrochemical complex enter production every year for the past few years.”

This intense and global level of activity calls for many skilled engineers. However, the upswing in refinery optimisation comes hard on the heels of a significant global economic downturn when many companies were forced to make cuts in technical personnel. Consequently, the available skill pool is relatively small and this means that there is competition to hire and retain experienced staff.

Skills can also be lost when experienced staff retire or choose commercial jobs that look more attractive because of the benefits and the dynamics of making deals, etc. Today, the average age of employees working in major oil companies and service companies is close to 50.

Given that oil and gas company employees generally retire between the ages of 55 and 60, and the average age of current employees falls in the late- 40s to early-50s range¹, we can expect some huge changes in personnel over the coming decade. Within the industry, this is referred to as “the big crew change” and its effects will be felt most keenly in North America and Europe.

Ken Coon, Human Resources Vice President, Shell Projects and Technology, is looking at strategies that will help Shell to address the crew-change challenge and encourage more young people to take up a career in engineering. “We can provide technical staff with varied and challenging projects, excellent working conditions and an opportunity to collaborate with some of the world’s most respected scientists and engineers. Chief scientists and senior scientists play a vital role in raising awareness of Shell research and development activities and are powerful symbols of the importance the company attaches to technical excellence.”

But where will these new engineers come from? Coon explains: “Shell aims to recruit locally wherever possible, but over the coming years we will see an even greater influx in international STEM talent. This will become necessary as demographics and the profile of skills sets in different countries change. Already, we see that there is a much higher proportion of STEM graduates in countries such as India and China relative to the USA and the UK.”

To those outside the industry, oil and gas can appear a dull and low-tech business where there is very little new ground for research and development. Nothing, insists Coon, could be further from the truth. “Oil and gas is a dynamic industry and the challenges we face are front-page news. Over the next few decades, the world will face three major challenges: providing sufficient food, clean water and energy to meet our needs.

"Oil and gas companies will play a crucial role in delivering the energy solution, which cannot be addressed in isolation. This compelling message of global proportion is the challenge that we must present and we are confident that it can inspire a new generation of scientists and engineers."

As part of its mission to inspire and promote engineering, Shell is contributing its support to the Queen Elizabeth Prize for Engineering. This is an international, biennial award administered by the Royal Academy of Engineering in the UK and supported by a range of private companies that are leaders in technology and engineering innovation.

The prize is intended to “reward and celebrate an individual or team of up to three individuals responsible for a groundbreaking innovation in engineering that has been of global benefit to humanity.” A distinguished and eminent panel of judges will select the first winner of the £1 million[$1.5 million] prize from across the world. Her Majesty the Queen will present the prize in the spring of 2013.

Anji Hunter, Director, Queen Elizabeth Prize for Engineering, explains, “During the search for a winner, we will discover and celebrate stories of engineering success, raise the international public profile of engineering and inspire new generations of engineers to take up the challenges of the future.”

Skill shortage or location mismatch?

According to a recent report,² companies face two challenges when trying to source STEM talent globally. The first is that they may lack information about where skills are located and the second is that even when they know where skilled people can be found they have difficulty gaining access to them. Problems in locating and predicting the availability of STEM talent in emerging markets can be a significant obstacle to success.

Even when companies know where to find STEM skills, accessing them can be problematic. Some qualified people will choose not to move and there may be barriers, such as government policies, employment and immigration laws, and infrastructure inadequacies that make it impossible to access these skills.

References

_{1. Craig, E., Thomas, R. J., Hou, C. and Mathur, S.: “No Shortage of Talent: How the Global Market is Producing the STEM Skills Needed for Growth”, Accenture Institute for High Performance, research report, September 2011}

_{2. The Strategic Importance of Talent, Rostand, A. and Soupa, O.}

For more information, contact Ken Coon.