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THE GAME CHANGERS What is happening right now that will have lasting effects on the energy industry’s long-term workforce strategies?
Brett Haugh Principal and EVP, Ascende
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GAME CHANGERS
“Game Changers” are critical to understand the energy industry: Fracking/shale revolution
Regulation and policy changes
Aging workforce
New technology
Grid modernization
Exportation of NGLs
Power generation – mix and carbon management
Infrastructure/new build
Exportation of LNG
5
THE FACTS
Since 2010, the energy industry has been hiring at a rate that outpaces the general economy
0%
25%
50%
Private Sector Oil & Gas
7%
25%
Since 2006, hourly wages have outpaced general industry
0.0%
10.0%
20.0%
30.0%
General Industry Oil & Gas
17.8%
23.7%
6
THE FACTS Up to 50% of energy industry will retire in 5 to 10 years – U.S. Department of Labor
Shortage gaps Engineering – mechanical, electrical, civil, petroleum, logistics, etc. Infrastructure – welders, truck drivers, electricians, pipefitters, mechanics, etc.
Global demand for energy will increase by 1/3 through 2023 The significance of game changers are not being factored into HR strategy to fill gaps due to employees:
Retiring General attrition Projected growth expansion
The industry is stealing from each other and driving up costs Controlling fixed costs, including wages and benefits, will be the key priority Greg Ebel, Chairman, President and CEO of Spectrum Energy summarized the workforce challenge like this:
“The limiting factor in the energy industry is not access to capital and not access to hydrocarbons to produce. The limiting factor is people.”
7
WORKFORCE PLANNING
8
External Drivers
Fracking/Shale Crew Changes
Millennials New Technology
Infrastructure Build Exportation
70% of all companies have NO plan!
Analyze
External Drivers Business Needs
Internal Workforce Talent Pipeline
Labor
Demand
Supply
Result
Value Proposition
WORKFORCE DEVELOPMENT
Community/region Executive team Students Parents Educators
Build competency model
Basic Job-specific
Employment opportunities Advancement
Balance supply/ demand Identify gaps Game changers Efficiency
Applicant tracker Talent supply
Work together City Region Nation
Trade organization Forum discussions
Compensation Benefits Culture Advancement Marketing/ engagement Attraction and retention
Workforce Development
Process
Career Awareness Education Workforce
Planning Structure
and Support Employee
Value Proposition
9
VALUE PROPOSITION (SEGMENTED)
10
Boomers Millennials Attract Retain Motivate Attract Retain Motivate
Base Pay High Medium Low High Low Low
Bonus Low High Medium Medium Medium Medium
Incentives High Medium High Low Medium Low
Benefits High High Low Low Low Low
T&D Low Medium Medium High High High
Culture Low Low Low High High High
Environment Medium Low Low High High High
Secret is the mix of programs and method of communication. What’s important to Boomers is not important to Millennials.
Additional segmentation by field vs. office personnel.
VALUE PROPOSITION (BASIC CONCEPT)
11
Value Proposition
Pay Benefits Performance Advancement Environment
Base
Bonus
STI
LTI
Medical
Retirement
Life
Accident
Disability
Perquisites
Feedback
Behaviors
Opportunities
Training
Personal Development
Professional Development
Growth Potential
Leadership
Culture
Management
Physical Space
Safety
Security
Diversity
Business Objectives (3 to 5 years)
Human Resources Objectives (3 to 5 years)
3 year shelf life maximum
TALENT MANAGEMENT, DEVELOPMENT AND ACQUISITION STRATEGIES IN ENERGY SUMMIT Tuesday, Sept 30th, 2014 | Omni Houston Hotel at Westside
Your Next Event:
FALL SUMMIT
Save the date!
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