Photo courtesy of Schlumberger
Deanna Newsome and Larry Burke, ION Geophysical, Houston
Even in the current business climate, most energy executives still consider recruiting and retaining the right personnel a major priority, not to mention critical to success. The best talent can give companies an advantage over competitors, and help increase profitability.
Simply put, the true key to success is finding the best talent and keeping them engaged and satisfied with your organization. Companies that can anticipate and meet these human resource (HR) challenges will be far ahead of the curve.
As we all know, recruiting and retaining is challenging in any industry. But for niche, global organizations like those in the oil and gas industry it can feel like an impossible task.
On top of common talent management issues, oil and gas has additional recruiting issues specific to our sector. First of all, this industry is as global as it can possibly be, reaching from Middle America to the farthest corner of Siberia. Secondly, the people in our industry are as mobile as they come. Down economy or no, there is always a high rate of transition in our business.
The result? There is virtually no limit to where, when, and how we need to look for people in order to be successful.
Multinational organizations face significant challenges in recruiting, properly onboarding, and retaining the best talent. The very diversity of the people, and the logistical realities that come with having offices all over the world, can be an HR nightmare — making it a real struggle to streamline processes and create a unified sense of corporate culture.
To prepare HR departments to meet the challenges that come with the creation and management of a global workforce, companies must be able to quickly find the right people, automate their HR processes, and retain the best talent.
Find the right talent quickly
At ION, as well as in the wider energy ecosystem, time is money. That is certainly the case for a lot of our technical hires.
An example of our need to make good hires fast would be within ION's data processing group. That's not "data processing" in the traditional IT sense — this is a group that processes the information that comes back from our seismic imaging and puts it in a readable form for our customers.
It is a very unique skill, and a very expensive process. The data interpretation we provide to oil companies and contractors helps them make decisions about where and how to drill — where, in effect, to commit tens or hundreds of millions of dollars in capital.
Thus, data processing is a critical component of ION's information workflow. If we want to expand this group, or need to replace members, we must do it fast. Every position we are down amounts to lost revenue. If we have to take 90 to 120 days to get new staff in and trained, we are losing money and opportunities.
Generally speaking, energy companies need specifically trained and qualified people. From a staffing standpoint, any time you are out looking for a very uniquely skilled group, it can be tough because you only have a small pool to pull from. The more unique the skill, the harder the search is.
On average it costs us around $60,000 to replace a geoscientist. Included in that figure is the cost of job postings, agency fees, relocation costs, and travel for interviews (for a number of candidates). Then we have the lost opportunity costs, defined as the money lost as a result of not having the right candidate in the seat doing the job. That number alone is about $350 per day for a geoscientist position at ION.
Finally, consider the cost of training and ramping up a new hire to full production (also estimated at around $350 a day with a reduced rate over time to full production for a geoscientist), with time to full production anywhere from one to six months depending on the experience the geoscientist brings with him or her.
Some of these steps, such as the cost of relocation, can't be avoided. But time-to-hire and time-to-productivity can be minimized by conducting an efficient search and by onboarding properly.
Talent in our world can be a moving target, and as we all know moving targets are harder to hit.
The ability to identify, track and keep tabs on people that you need to successfully run your business becomes critical. And a robust, user-friendly system that helps your company track people and store resumes is critical.
The key to organizing and streamlining the process is automation.
Automate your efforts
We have automated ION's recruiting and onboarding processes, and while the transition takes up resources, brain power and time, the benefits are sweet indeed.
As we previously mentioned, speed is critical in hiring candidates. Having an applicant tracking system (ATS) will help companies automate their processes, and makes talent more accessible. At ION, we use SilkRoad Technology's OpenHire, which has fit our needs.
We encourage our HR colleagues in oil and gas to take a look at all of the HR automation options, and select a technology vendor based on what fits your business needs and helps you reach your particular goals.
Our ATS has proven invaluable to our business, and helped us become efficient and automated on a global scale. If someone works in the industry, there's a good chance at some point that person has submitted or will submit their resume/CV to us. It is, after all, a small community.
For this reason, we haven't cleared the candidate database in our ATS in a while. So, when we have an open position we have resumes to search through. This database also helps us stay in touch with potential candidates and track them for future hiring.
The mobility in oil and gas makes it nearly impossible to "keep tabs" on someone, but our ATS helps us identify potential candidates, reduce hiring costs, speed time-to-hire, as well as keep our search and incoming resumes organized.
As part of our efforts to better assimilate offices from the different regions, we also turned to HR technology for help with onboarding new hires with another SilkRoad product called RedCarpet. Overall, automation has significantly increased readiness of new hires, improved retention of employees and lowered the amount of paperwork and processing associated with administrative tasks. Not to mention the fact that an employee doesn't spend his or her first day filling out paperwork, and HR doesn't allocate time to processing that paperwork. Our automated onboarding process has enabled our new hires to "hit the ground running."
Retain your employees
It's difficult to put a financial number on retention, because it is next to impossible to estimate the "knowledge cost" that leaves with an outgoing employee. Suffice to say it is a systemic cost, and a big one at that.
As we mentioned, the cost of replacing an ION geoscientist is approximately $60,000 — so let's use that number as a reference point to underline the importance of employee retention.
So, yes, as the financial costs are high, energy companies need to do everything they can to retain team members. That includes having a solid onboarding process in place. Candidates generally make the decision to stay with a company within their first three to six months of starting, so don't lose your opportunity to engage them early.
Like the saying goes, "You never get a second chance to make a first impression." Energy companies should make sure to give employees a positive experience from the first interaction. Help your new hire become socialized in the company even before their first day on the job. It helps them become more productive in a shorter amount of time and more engaged with the company. Use your onboarding process to introduce them to your corporate culture and spread your brand throughout your workforce.
If a company is fortunate enough to hire the best and the brightest, it's important to remember that those individuals are always looking for a challenge. In our experience, geoscientists are happiest — and most likely to remain working — in an environment that provides them with a high level of professional challenge and interest.
In a surprising twist, exciting and interesting work actually trumps financial concerns among most geoscientists. They just want to work with cutting-edge technology, and they'd prefer to do so with people who they see as being as smart as they are.
When energy companies lose specialized employees, it can be tricky to replace them because there are not a great deal of candidates in the pool.
Formalizing a retention strategy, and executing against it, will pay both short- and long-term dividends.
Reap the benefits
Several years into an automated and deliberate HR framework, we are very happy with the results, and have seen an increase in retention, as well as a faster time-to-productivity metric.
As with any growth process, taking the first step can be challenging. But just like the spirit of exploration and innovation that drives the energy sector, company HR departments should always be willing to embrace solutions that are better, faster, and help an enterprise succeed overall.
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