Blending Leadership in the Oil Team
The workforce in the oil sector is becoming restless! A recent report revealed that four out of five employees are thinking about leaving the industry. (Airswift, 2024) Employee priorities have shifted dramatically since the pandemic. A McKinsey analysis suggest that the most important factor in retaining employee is leadership style, and not compensation! (McKinsey & Company, 2024)
Emergence of New Leadership Style
The McKinsey research has noticed a new leadership style emerging in the oil business that affect how people view their organization. (McKinsey & Company 2024) Employees are looking for a more collaborative leadership style that focus on sustainable growth and value creation.
The oil industry has long been hierarchical where decisions are made from the top down. This could be a positive change towards a collaborative culture that encourages teamwork, shared goals, innovation and open communication. (Maalouf, 2019, p.140)
Collaborative Culture Leadership vs. Not Having it.
The Deepwater Horizon Oil Spill in 2010 causes extensive harm to the environment and claimed many lives. It was largely blamed on poor leadership and hierarchical decision-making structure in BP. (Hall, 2023)
Chevron’s culture of employee engagement by promoting open communication and transparency has brought its top-level executives closer to employees. (Callahan, 2001, p. 11)
Tuckman’s Model
Applying the Tuckman’s model can help develop a collaborative culture by going through the stages of forming, storming, norming and performing. Leaders can encourage open communication and constructive conflict resolution to build trust and unity during the storming period. By stressing teamwork and recognizing individual capabilities during the performing stage, organizations can create a collaborative culture to reach common goals. (Vaida & Serban, 2021, p. 96).
Although understanding the stages of team growth can help teams be aware of their dynamics and deal with problems together, the model’s depiction is straightforward and may oversimplify the actual relationships and interactions.
The Right Leadership and Management
According to Peter Drucker, the difference between management and leadership is that management is about getting the day-to-day tasks done effectively but leadership is about setting a strategic direction, motivating and empowering people to achieve the organisation’s goals. (Dublino, 2023) To manage a team well, one must play several roles: as a leader, coordinator and coach. All the roles work together to create a positive work environment, empowering individuals to achieve the company’s objectives. (Ibeme, 2020, P. 435)
Building high performance teams requires a leadership that sets clear goals, empower team members, offer regular feedback and invest in their skill developments. When a team performs poorly, Johari’s window model can be used to help them to be self-aware and adjust through feedback. (Welch Jr, 2023, P. 3) Although the process can foster team collaboration to fix problems, we must be mindful that personal perceptions and human interactions can vary across cultures.
Leadership styles vary by country and industry. American leadership styles are typically collaborative and empowering in nature. (Mills, 2015) A collaborative leadership style may be needed in the creative sector to foster innovation while an autocratic style may be required in finance sectors to maintain compliance.
Great Global Leaders
Bob Dudley (Former CEO, BP): Following the Deepwater Horizon incident, he decentralised decision-making, encouraged workers to work together to rebuild trust across the companies. Dudley believes that global leaders must become masters of communication and build productive relationships with all stakeholders. (James, 2011)
Lubna S. Olayan (Chairperson, Saudi Aramco): First woman to lead a publicly listed Saudi company, she has championed programs to empower women in the workforce and increase diversity in the leadership of the company. (Fry, 2015)
It is evident that these two leaders have a clear vision and mission, and when they empower and communicate openly, their employees are more motivated and engaged in their work.
New Leadership Needed in Oil Industry
As employee’s priorities evolve in the oil industry, there is a noticeable trend towards collaborative leadership styles that focus on sustainable growth. Recent examples have shown a shift away from hierarchical structures towards more participative cultures that encourage teamwork, new ideas and open communication.
The energy industry is stressed for a different kind of leadership due to growing compliance issues and preparing for an energy transition. A new kind of leader is needed urgently, he/she must think like an activist to innovate, act like a diplomat to build relationships and improve the industry’s image.
As part of the oil industry myself, I will follow a leader who above all competencies, can engage their workforce, to be an advocate to restore some sense of pride in the industry’s mission of supplying energy to the world.
References
Airswift. (2024). The global energy talent index report 2024. https://3277184.fs1.hubspotusercontent-na1.net/hubfs/3277184/Gated%20PDFS/GETI-2024-web-version.pdf?__hstc=53004663.3144538d1b4947bb23cd40dd464442ad.1719413470481.1719413470481.1719413470481.1&__hssc=53004663.2.1719413470481&__hsfp=2156772317
Callahan, Darry & Company, Chevron & Nolan, Timothy. (2001). Changing the corporate culture at Chevron. Behavioral Technology Today Cambridge Center for Behavioral Studies. 1. 1-12. https://www.researchgate.net/publication/228431208_Changing_the_corporate_culture_at_Chevron
Dublino, J. (2023). What your business can learn from Peter Drucker. Business.com. (2023) https://www.business.com/articles/management-theory-of-peter-drucker/
Fry, E. (2015). This CEO is helping Saudi women break a gender barrier. Fortune. https://fortune.com/2015/09/14/lubna-olayan-saudi-arabia/
Hall, A. (2023). The role of BP’s culture in the gulf oil crisis. https://aaronhall.com/insights/the-role-of-bps-culture-in-the-gulf-oil-crisis/
Ibeme, N. P. (2020). Effect of leadership styles on human capacity building and sustainable management of SMEs in Enugu State, Nigeria. International Journal of Management, Social Sciences, Peace and Conflict Studies, 3(3), 431-454. https://www.academia.edu/70741358/Effect_of_Leadership_Styles_on_Human_Capacity_Building_and_Sustainable_Management_of_Smes_in_Enugu_State_Nigeria
James, D. (2011). BP CEO Bob Dudley on redefining global leadership. Forbes India. https://www.forbesindia.com/article/thunderbird/bp-ceo-bob-dudley-on-redefining-global-leaderhip/27552/1
Maalouf, G. (2019). Effects of collaborative leadership on organizational performance. International Journal of Multidisciplinary Research and Development, 6. 138-144. https://doi.org/10.22271/ijmrd.2019.v6.i1.25
Mckinsey & Company. (2024). Employee retention trends and challenges in the oil and gas industry. https://www.mckinsey.com/industries/oil-and-gas/our-insights/employee-retention-trends-and-challenges-in-the-oil-and-gas-industry
Mills, Q. (2015). Asian and American Leadership Styles: How are they unique? Harvard Business School. http://hbswk.hbs.edu/item/asian-and-american-leadership-styles-how-are-they-unique
Vaida, S. & Serban, D. (2021). Group development stages. A brief comparative analysis of various models. Studia Universitatis Babeș-Bolyai Psychologia-Paedagogia. 66(1), 91–110. https://doi.org/10.24193/subbpsyped.2021.1.05
Welch Jr, J. (2023). Visioning strategy through the “Johari window”: discovering critical “unknowns” in a rapidly evolving context. Strategy and Leadership. https://doi.org/10.1108/SL-05-2023-0056
Shann Tay Mottram 
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