Jennifer Pallanich Hull
Gulf of Mexico Editor
Petroleum sector hiring rates exploded in the 1980s before employees were let go over several cycles of industry down-sizing. The industry now faces the chall-enge of not only recruiting new faces into the industry, but also training them.
Mike Baranovic, Shell Exploration & Production Co. (Sepco) manager for staff planning and development – geoscience, said the oil industry exacerbated its recruitment challenge when it started offering voluntary early retirement in the face of industry downturns.
"We're guilty of making our problems worse for ourselves," he said. "We're not the only company that's done that to ourselves."
After learning that lesson, oil companies are examining how they recruit, train, and retain newhires.
J. Ray McDermott's Morgan City, Louisiana, facility has been busily hiring, ramping up for several large projects. In late July, the yard employed 1,050 and expected about 1,300 workers on its payroll in 2003.
Halliburton Coiled Tubing Unit "Show-Me," in which trainees learn operational procedures by following a set of highlighted sequential steps while operating the virtual simulation.
"It's not easy to find good people, but at a rate of about 50 a month, we're finding them," said Frank Smith, vice president and general manager of fabrication operations, Western Hemisphere.
Once they're hired, J. Ray must train the full-time employees and subcontractors.
"We take kids who don't know which end of the bat to hold and turn them into sluggers," he said. New-hires spend time learning how to weld or perform other tasks before setting out to work.
Because the company wants educated employees, J. Ray has set up a general equivalency diploma (GED) program, equivalent to a high school degree. Over the first four months of that offering, 11 employees earned their GEDs, and over 50 signed up to earn the degree through the self-paced program. An incentive, Smith said, was the company's recent requirement that all foremen and leadermen either hold a high school diploma or its equivalent or be enrolled in the GED program.
J. Ray offers a retirement plan for hourly empl-oyees and scholarships for employees' children.
Seeking a workforce
When Global Industries found the industry facing a workforce shortage, it looked to the existing pool of candidates for blue collar crafts.
"We've encouraged all our youth to go to college" by telling them they won't go very far without an education, CEO William J. Doré said.
After exploring several possibilities, Global Industries sought out the US Hispanic population to meet its offshore labor requirements.
"That's filling in our voids," he said. "Our Hispanic new hires are dedicated field workers with a great work ethic. They are going to be the salvation of the oil patch."
The only concern, Doré said, was about potential cultural conflict between the old guard and the new hires.
"There has been, in the history of the oil patch, a culture that's been developed," he said. "That culture is changing."
Use of primarily Spanish-speaking personnel alongside English speakers required Global Industries to develop a specialized bilingual training program. The company devised online training and training tapes that teach useful offshore terms and lingo in both Spanish and English, as well as describing duties associated with each position. Doré said both Spanish and English speakers were using the system to better communicate with the other.
As many companies do, Schlumberger looks to college campuses for new recruits. But instead of just focusing on the graduates, the company seeks college seniors to participate in its Schlumberger Training and Advanced Recruitment program. For one year, the interns are members of the service company's staff, beginning with a 10-week internship and subsequently performing a few days of work each month on a specific project. The few offered the STAR spots are guaranteed a job offer on graduation.
"They're the best ambassadors you can have on campus," said Meghan O'Keefe, recruiting manager for North and South America, about the program that originated in 2000.
One of Schlumberger's main selling points to job applicants is the opportunity for an immediate posting abroad, she said.
"For the people who are up for it, it's a big selling point," she said.
O'Keefe said the company focuses on promotion from within the ranks and "borderless car-eers" in which personnel can move geograph- ically, across departments, and up the career ladder.
The company works to make sure the employee's spouse receives assistance seeking a job when a posting takes the couple overseas. Schlumberger's focus in that area led the company to help found www.partnerjob.com, a site dedicated to helping a spouse locate a new position following a transfer.
About 300 Schlumberger employees a day participate in training at the Kellyville, Oklahoma, center, said Francesco Turchetti, recruiting, training, and development manager. The center uses programs from Houston-based Simulis to prepare its newhires for work on expensive equipment.
Simulis develops and delivers simulation-based training (SBT) systems that describe industrial processes, systems, and equipment for the energy, healthcare, manufacturing, aviation, and defense industries. These systems assess the knowledge of personnel for a task, provide interactive training to assure performance, and enable skills certification.
A simulation software technology called Rapid CBT is used to develop computer-based simulations of equipment-operator interfaces linked to underlying "live" schematics. These simulations are embedded into comprehensive training programs that duplicate the appearance and behavior of processes and equipment under realistic operating scenarios. Normal and non-normal situations can be modeled to assure user comprehension and response to real-world experiences.
"Any process that you can perform with the equipment, you can perform with the simulation," George Stapleton, director of energy services for Simulis, said.
SBTs provide a visual "show-me, try-me" learning platform enabling users to increase their level of skill and productivity. The virtual device simulations enable users to learn equipment features and functions in a hands-on environment without interfering with operations or tying up actual systems specifically for training. Simulations can include dynamic schematics of devices for cause-and-effect scenario training. Operators can learn the relationship between control panel actions and system performance through these interactive schematic diagrams.
Assessments can be performed using the simulations with trainees' actions recorded step-by-step for reporting, analysis, or playback. Because the interactive training and testing system records a trainee's click-stream while operating the simulation, the trainee "can't bluff their way through it" like they might be able to do with short answer or true and false tests, Stapleton said.
He said using Simulis training technology addresses the industry's high costs of training, high turnover of personnel, large liabilities for human performance failures, and challenging regulatory compliance issues. The SBTs appeal to international companies because they make training more cost-effective, as companies do not need to bring employees from one country to another to train them on specific equipment.
"If you're working in 140 countries, how do you train people?" Stapleton said.
Simulis has created simulations of coiled tubing units, cementing units, wireline and logging units, stimulation spreads, drill floor units, and other equipment-specific units for service companies. Plans call for "generic" SBTs to be developed on topics such as well control, production safety systems, and production lease operations.
Halliburton began incorporating Simulis products into its training lineup about 18 months ago, said Craig Hughes, manager of global learning centers for Halliburton Energy Services.
The system "works very well with our (Docent) learning management system," he said.
"Halliburton has been developing people for a long time," he said. "The primary means of training people in the past has been instructor-led training. What we're doing now is taking advantage of the latest technology to move to a blended approach for learning."
The blended approach features:
- E-learning, in which the student logs onto the Halliburton Intranet and takes self-administered courses
- Virtual learning, which is a combination of the virtual classroom and virtual simulation. Students participate in the virtual classroom by logging into the classroom via the Internet and interacting with a live instructor. Students can take the online simulations, or Simulis, courses at a self-paced rate
- Instructor-led training, during which students take courses at one of the company's five global training centers.
"Simulations are really a key way for people to learn the various aspects of their job. Halliburton's people-development philosophy is competency-based," Hughes said. "We can use the web-based training for them to gain knowledge. We use the virtual classroom and simulations for them to expand their knowledge and begin developing skills, and then we use the classroom training to further develop their skills and competence so that they're extremely well prepared to do their service jobs."
Halliburton has simulations being built for the majority of its field service staff, he said.
Schlumberger's Kellyville training center is designed around teaching the procedures involved with operating different machines. These machines range from simple to complex and are devoted entirely to training, Turchetti said. Disadvantages are the requirement that trainees be in Oklahoma for the sessions and that there is a finite amount of time that can be dedicated to training, Turchetti said.
The addition of Simulis training fits in with methods already in place at the oilfield services company with several benefits.
"We're not going to teach people how to fully operate the equipment here, but we're going to teach them the processes," Turchetti said.
Trainees can go through the processes until comfortable with the procedures, he said.
A major bonus of the computer-simulated system is that it will allow "non-normal" activity, Turchetti said. The program will show what to do if something goes wrong on a job, something not feasible with real equipment, he said.
During the months that Schlumberger has been using SBTs, students "advance more rapidly since they'd already been practicing with the simulator," said Gerardo Kuracz, knowledge delivery manager for Schlumberger Well Services. "The benefits of this type of system is that they have the opportunity to familiarize themselves with the equipment before they see it in real life."
When the employees come to the training center, they already have the basics from the simulator, Kuracz said. "They have more time to do hands-on work rather than starting from the very basics."
"That new workforce was brought up on computer games," Stapleton said. "They don't read manuals."
Some Simulis systems play on that approach by allowing trainees to work with SBT units and recording competitive performances arcade-style.
Shell changes its approach
With the demographics of the existing workforce quite aging, Shell has been working to decrease the demographics gap in its own ranks, said Ramon Vallejo, E&P recruitment manager for the Americas for Shell People Services. Over 50% of E&P Shell employees are expected to retire in the next dozen years, a problem not as severe globally as it is in the US, he said.
To meet shortages associated with the big crew change, Vallejo said, Shell has widened its net, no longer seeking only fresh faces from the college crowd.
"Historically, we haven't been a company that's hired from the experience side," he said.
"Our recent offshore recruiting has been targeted to hire employees with previous experience either in the E&P industry or those with related skills from plant operations," Christina Sistrunk, Sepco skills pool manager, Gulf of Mexico operations, said. "We have hired about 120 offshore employees in the last two years. We are currently in the process of determining where we will be recruiting for our future offshore staffing needs since we know that the industry cannot continue to provide an adequate number of experienced personnel. This will likely focus on recruiting at technical schools and four-year universities and will include an apprentice program to ensure these employees have the opportunity to quickly gain the skills to make them successful in our organization."
Baranovic said, "In the last three years, we've gone back to college campuses in a big way, compared to the mid- to late-'90s."
And the courtship might not be that one-sided in a time when America's college graduates are struggling to find employment in a soft job market.
"We've seen a trend in college students looking for blue chip companies," Vallejo said.
The looming personnel shortage is more than double for an international company. In Europe, Vallejo said, the number of those seeking engineering, sciences, and geosciences degrees are decreasing.
"We're finding more and more that we need to use US talent and workforce to source our E&P needs globally," he said.
Shell's Baranovic said the company has set up leadership training for its engineering staff.
That sort of training goes along with the other average 12 weeks of training each new employee receives at Shell during the first 18 months. A six-week stay in Holland or Mal-aysia is a typical first stop, where Shell's new hire receives generic E&P training. This program evolves into specialized training depending on the employee's job. Some of this training is in-class, some is via computer, and some is through alliances with universities, Vallejo said.
Shell designed its New Professional Develop-ment Program around making sure its technical employees obtained certain competencies as well as tailoring training to the employee's goals. Each new hire is part of the program for three to five years, said Anne Saddington, Sepco skills manager for new technical professionals.
"Our people learn at different speeds," she said, adding the varied pace allows employees to balance needs to train and perform work along with family life.
Once an employee completes certain courses and demonstrates predetermined competencies for that skill pool, the individual is free to seek jobs anywhere Shell operates, Vallejo said, adding the opportunity for global placement is one method Shell uses to improve recruitment and retention rates.
The independent has a different picture to sell.
Rather than spending money training recent graduates, Mariner Energy courts those who already know the business, said Mariner Energy Senior Vice President David S. Huber. When working in a group of 50 employees, each person is given "a chance to see the big picture and influence the big picture," he said. "The work environment in a small company makes people blossom."
And the extra bucks can't hurt.
The government casts its net
The Golden Years are also beckoning government employees. "We have a lot of people within five to 10 years of retirement. Eligibility, anyway. Some people you'd have to carry out dead," said Chris Oynes, regional director of the US Minerals Management Service.
To prepare for the coming retirements, the MMS sought, and received, a technology training line item to its budget.
"Going to a subsea workshop is very expensive," Oynes said.
When the MMS pursues certain types of engineers, "we have to compete against the Shells," Oynes said. As the competition for new employees is stiff, he said, the government is recruiting mechanical and civil engineers and turning them into petroleum engineers.
The MMS also won a budgetary line item that funds an engineering intern program. The first dozen interns participated this year, he said.
Holding on to gold
Companies have struggled to find ways to retain the talent they struggled so hard to find during industry booms.
Over 30% of J. Ray McDermott's workforce has been employed by the company for over 20 years. Frank Smith, vice president and general manager of fabrication operations, Western Hemisphere, attributes the high retention rate to how the company treats its employees during lean times. In 2001, with a dearth of work scheduled for the fabrication yard, J. Ray let its employees know there would be lay-offs but that workers would be recalled as soon as another project started.
"It's unfortunate that our business has these cycles," Smith said.
With the looming layoffs, he said, the company talked to other companies to help with outplacement services. After having to lay off 350 staff, J. Ray was able to move up work on BP's Mardi Gras project and recall the employees. He said 94% had returned to the yard by early 2002. At Global Industries, said CEO William J. Doré, the company often must release its employees over the slower winter. Despite the seasonal layoffs, he said, the company continues to pay for health insurance coverage for these employees each winter. In effect, the workers collect unemployment for three or four months, retain health coverage, and return to work when the busy season returns. Doré said some employees take advantage of the seasonal layoffs to plan winter vacations and go hunting.
"Most people are more concerned about health insurance than anything else," he said.
During the last downturn, Schlumberger shifted many employees overseas. "Where business is, you can move people to those places," Meghan O'Keefe, recruiting manager for North and South America, said. "It costs money to do that, but over the long-term, it's money very well spent."
To avoid the need to layoff people during tight times, Shell has begun testing its investments at lower price sensitivities, said Ramon Vallejo, E&P recruitment manager for the Americas for Shell People Services. The company can also move willing employees from a sputtering market to a thriving market, an approach not in place at Shell during the downswing in 1998.