1. Creating
Leadership map for
tomorrow
8th Oil and Gas HR Round Table
August 28, 2009
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2. What an opportunity for leadership!
Demand – capacity gap: immense growth
potential and opportunities
Maturing fields and downstream assets
New technology and scale challenges in deep
water, EOR, CBM, etc.
Greater regulatory pressure, in context of intense
competition
Climate change imperatives – energy
productivity and efficiency, renewables
Growing international operations and related
challenges

3. Higher bar for leadership performance
Leadership asks
What is needed
Higher levels of ambiguity and
risk
A leadership
Entrepreneurship and global ‘engine’ that can
perspective attract,
accelerate
Ability to build develop and
retain leaders in a
Ability to work with
communities and regulators
self sustaining
manner
Retention of existing personnel

4. 3 elements of a leadership engine
▪ Accelerating
Individual
development of a
1 leader
critical mass of leaders
development
for the organisation
+
Self- ▪ Integrated people
sustaining Leadership development, review
leadership = 2
systems and opportunity
engine matching systems
+
▪ Pervasive development
Leadership culture: feedback,
3
culture mentoring and
coaching culture

5. 1
Invest in developing people as part of their real work
Principles What this will accomplish
Link leadership to ▪ Provide razor-sharp focus
business strategy on core business
Structured
challenges
approach to
Develop people in create ▪ Achieve stretch
stretch roles on the awareness, performance with a safety
job instill net
motivation,
Combine reflective provide inputs ▪ Accelerate the
and fieldwork and on the job development of leaders
sessions practice and significantly
Make mentoring and feedback ▪ Take a business driven
role modeling a ‘way systematic view of
of life’ leadership development

6. Forums
1
Typical approach • Superior, not in reporting
hierarchy
A • Supports participant
Identify development through
participants and E - Engaging with superiors
match to C Stretch individual, and stakeholders
specific Identification of deliver business Guide - Coaching participant
challenges learning edges and impact and build - Adding org context
creation of action confidence through
plans on-the-job business
challenges
B
Developmental
feedback from
different
sources (270o Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7
Feedback) D
Structured inputs on different topics through
- Forums input tailor-made, just-in-time knowledge and skills
- On-the-job coaching to accelerate learning and track
individual progress
F
Continued developmental feedback from
different sources

7. 2
Leadership systems
▪ Structured process to decide on new
Recruiting roles
▪ Use creative approaches to recruiting
▪ Volunteers and nominations for
Harnessing positions
▪ Internal marketplace for talent
▪ Match portfolio of opportunities with
Matching portfolio of leaders
▪ Enable X-business, functional mobility
▪ Ensure developmental focus to
Performance performance management
management ▪ Make developing leaders a KPI

8. 3 The vital few desired shifts in performance culture can be
influenced by interventions on 5 dimensions
The organization’s culture will shift if . . .
Role-modeling Understanding and
‘…I see leaders, conviction
peers and reports ‘…I know what is
behaving in the expected of me, I
new way’ agree with it, and it is
meaningful’
Personal
choice
‘…I choose to
make a Reinforcement
difference’ mechanisms
Skills required
for change ‘…The systems
‘…I have the skills, reinforce the
capabilities and change in behaviour I
opportunities to behave am being asked to
in a new way’ make’

9. Leadership development case studies
High-tech machinery
and equipment
company (60,000 Large retail bank
employees, USD 17 Leading retailer in (26,000 employees,
billion revenue) Latin America 20 geographies)
▪ Deep cultural diagnostic, ▪ Leadership Academy launched ▪ Developed critical mass of
training and on-the-job coaching, – core programme for top 250, leaders – focus on deep
focus on top 100 wider in focus for top 750 personal transformation
▪ Rise in leadership abilities, ▪ Increased customer satisfaction, ▪ 20% drop in cost to income ratio:
USD 500 million EBIT gap 8% increase in EBIT strong external recognition
closed
Regional energy
powerhouse (USD 60 Leading oil & gas
billion sales across company (USD 40 Global chemicals
oil, gas, retail, billion sales, 2,000 and materials
petchem) employees) manufacturer
▪ High profile breakthrough ▪ High impact fieldwork projects; ▪ Frontline training linked to daily
projects and ongoing capability on-the-job coaching work
building
▪ Sustainability achieved – nearly ▪ USD 100 million savings in
▪ USD 1.2 billion annual EBIT 30% of all employees 6 months; improved leadership
improvement, new culture supporting projects capabilities

10. Learning from case studies
Go beyond training to holistic development
Develop a common leadership model
Work with the eco-system, not just the leaders
Establish ownership with the business units
Focus on development instead of evaluation

11. Creating Future
Leaders of the Oil
and Gas Industry
8th Oil and Gas HR Round Table
August 28, 2009
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Any use of this material without specific permission of McKinsey & Company is strictly prohibited