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HR departments across the oil patch are reforming to survive the oil-price slump: Here’s why

Posted On August 23rd
By : EnergyNow Media
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Rethinking this often-underused part of the company can deliver real dividends, even in a downturn

BY ALBERTA OIL STAFF

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HR departments across the oil patch are reforming with gusto in an effort to survive the oil-price slump and position themselves for the rebound. “If [HR departments] will ever have ‘internal social license’ to optimize their HR programs, it’s now,” says Angela Kennelly, a business developer at Workday, a provider of cloud-based HR applications for industry. The questions that HR professionals are asking right now, she says, are what kinds of people, processes and technologies does a company need in place to facilitate a more efficient operation? Should companies centralize some HR functions that are currently done in the field? Do managers and leaders have the real-time information they need to make good decisions on talent? Is there an opportunity to streamline supporting technology to better serve leaders and further the company’s business goals?

Susan Poynter is vice-president of HR at Spartan Controls. “The downturn in oil and gas has been tough on the industry,” she says. “HR views this as an opportunity to look for ways to re-engineer or eliminate outdated processes. We are significantly using technology and automation to reduce costs.” For example, Spartan now uses Skype for team meetings and interviews, and is providing employees with more online tools to perform HR tasks themselves. “We’ve contracted to a more centralized HR department. We’re more green, lean and mean,” she says.

As part of this shift, HR departments are focusing on business strategies that are born out of the crisis and the need to meet customers’ changing needs. Across the industry oil producers are looking to develop solutions that will help them reduce their costs, improve production efficiency and assist with environmental compliance and safety.

Service firms are switching strategies too. Packers Plus Energy Services has gone global, expanding its markets to the Middle East and South America, which requires HR policies and processes that are more universal, and applicable both in and outside of North America. Paula Thompson, director of HR at Packers Plus says, “We want our people to be able to adapt to change and embrace new cultures.” To execute that, the firm’s drawing on HR consultants. The slump has driven other changes, too. Each department is now accountable for quarterly deliverables and the company has created a five-year strategy to focus its resources. Many companies are making similar moves and re-focusing on their core HR principles. A big part of that is not just understanding employees’ needs and ambitions, but the needs and ambitions of customers too.

Companies are also struggling to counter the oil recession’s downsizing effect on employee morale, especially in Calgary. The best way to do that, according to HR professionals at several Canadian energy companies, is to make the human resources experience an ongoing conversation with employees, rather than a last-minute meeting.

Open and honest communication and succession planning is key to an effective human resources department. And the news doesn’t always have to be bad, either. Packers Plus’s HR team has launched a handful of morale-boosting initiatives, including the freedom to dress casually during the summer months and paid time off for volunteer work, to name just two.

Nav Dhunay, CEO of oilfield technology firm Ambyint, says if a human resources department can, it should retrain as many employees as possible to perform tasks outside their usual routines. “Retool a production engineer on how to optimize an oil well,” Dhunay says. “And that retooling makes them more valuable to the company. Employees will see that they have to retool [because] if they don’t, they become irrelevant to the company.”

Any good HR department should always be striving to broaden its workforce’s skillset, especially in a market downturn. “We’re doing more with less—and in more variety—from 18 months ago,” he says. “Individuals were specialists in different areas before, but now they’ve taken on other areas of work.”

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The North West Redwater Partnership is launching a hiring blitz as it ramps up to full production in 2017

Photograph Paul Swanson

Refining is recession-proof. For Alberta’s soon-to-open Sturgeon refinery—the first refinery to be built in Canada in 30 years—the company is now hiring 50 staff, including marketing, operating and administration personnel, to add to its 400-strong team at both North West Redwater Partnership and its contractor crews. The first 50,000 b/d phase will reach full commercial operation by the end of 2017.

“This is an exciting time for HR to attract talented people,” says Doug Bertsch vice-president of regulatory and stakeholder affairs with the NWRP. “We don’t see the boom and bust cycle. We have a long view on operations and these high-value opportunities will last for generations.” Some energy companies are losing staff to that newly produced talent pool, which firms such as NWRP can draw from. Not only can expanding companies cherry-pick from it—which is true for any recruiter in today’s market—but refiners have an edge in attracting quality staff as they can offer long-term, quality jobs. The types of professionals who staff and operate a refinery are typically not cut loose when there’s an oil slump.

But NWRP has an additional carrot to hand, Bertsch says. “We are the environmental gold standard for refining, so we will draw people from a pride perspective. It’s not just a job, but a career. They have the opportunity to make Albertan history. It’s the first refinery in Canada to have carbon capture designed in from the onset. We can draw talented professionals who can say, ‘I’m proud to be working here.’”

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