Professional Documents
Culture Documents
In 2013 Middle Oil Co. (MOC) was growing rapidly. Its services operations
were particularly buoyant and it had seen 30% growth in revenues from
the previous year. It was also expanding its portfolio of operating assets
and had been awarded 2 new contracts for major projects in the North
Sea. These huge projects would have more than 20 year lifespans,
following the initial 5 year development phase. Things were booming and
the offices had never been busier. In fact, things were being stretched
beyond the limit. The market for petroleum engineers was brutally
competitive and the wage bills were growing at alarming rates (Staffing
Industry Analysts, 2014). MOC was being forced to poach engineers from
competitors just to fill gaps and when established employees learned, as
they always do, the rates being paid to new hires this further increased
the pressure on wages. The constant poaching between competitors for
experienced staff was leading to very high staff turnover figures. Even for
experienced engineers it sometimes took 6 months for them to get up to
speed with MOCs systems and processes, and with the constant comings
and goings of engineers, the offices were never running at full efficiency.
To compound the problem, much of the oil field workforce was aging, and
many of the skilled workers it needed were approaching retirement.
In many cases MOC was hiring consultants who charged inflated day
rates. Despite the fact that these consultant engineers were being well
paid, in many cases they did not have the companies long term interests
at heart, instead these consultants only performed tasks allocated and
would jump ship, as soon as they were offered a marginally better paid
position by a competitor. Regular employees on the other hand really
understood the distinctive MOC culture and worked to deliver long term
value for the company.
The increased staffing costs were starting to eat into the companys
bottom line. Despite the high day rates that MOC was paying consultants,
the quality of these workers was highly variable. Furthermore, when MOC
staff learned of the day rates being paid to consultants it created further
internal friction and upward pressure on pay.
It had been decided at upper management level, that the skills shortage
had to be addressed in a long-term and strategic manner.
MOC had been criticized in a recent shareholder meeting as it had, a
particularly poor record on gender equality with only 1 of the 12 board
members, and only 5% of upper management being female. The
shareholders pointed out that this gender inequality was not just
concerning from a moral view point, but may as literature indicated be
resulting in lower performance (Mickinsey and Co., 2007) and poorer
decision making than may otherwise be the case in a more gender
balanced company. The gender balance was particularly concerning as it
had been shown that males had a propensity to take riskier decisions than
women (Women on Boards, 2011). One of MOCs competitors had just
been the centre of a huge industrial accident where questionable risky
decision making was centre stage. Therefore, pursuing credible risk
reduction strategies, was critical to maintaining and enhancing
shareholder confidence. For this reason, the board had decided to focus
not get adequate support from employers to enable this (NES Global
talent, 2013).
Support
Another difficulty was to help women integrate into in a predominantly
male dominated environment. Many offices in the oil industry were boys
clubs where especially the older men were not used to dealing with
women on a professional level. This could result in womens contributions
not being valued in the same way as their male peers. Women sometimes
felt uncomfortable raising objections publicly or had a different approach
to conflicts that did not fit with the traditional male sense of winning
despite the fact that these more consensus based approaches often
added significant value to the overall operations success. This recognition
gap was common across the industry with 55% of women in the industry
stating that they did not feel they got the same level of recognition as
their male peers (NES Global talent, 2013).
Promote
Perhaps the biggest problem was the fact that women looking at the
almost all male board and management team could not visualise
themselves as part of that team and this meant there were mental blocks
on their careers aspirations. MOC had to find ways to break through the
glass ceiling which existed as much in the minds of their junior female
employees as it did in the company itself.
Despite all the complications above the board felt that if it pursued a more
gender balanced work environment the benefits would far outweigh the
costs. The HR department was tasked with drawing up plans to address
all stages of the process of getting more women into the company,
Exhibit 3(Deloitte,2014)
Exhibit 6 (McKinsey,2014)
Mckinsey conducted study over 200 companies and over 115,000 individuals by diagnostic tools to measure the
correlation between organizational excellence and profitability. The tools have nine criteria: leadership,
direction, accountability, coordination and control, innovation, external orientation, capability, motivation, work
environment and values. The companies ranked higher of these nine criteria tended to have better financial
performance. And then they started to analyze the better financial performance companies relative to gender
diversity. (Figure XX) And they draw the conclusion that companies with a higher proportion of women on their
management committees are also the companies that have the best performance.