7 hr perspective-the need for new recruitment strategies
HR PERSPECTIVEThe Need for NewRecruitmentStrategiesBy Manoj ParmeshCountry HR Manager, Weatherford India Business UnitR ecruitment has become the most challenging human resources (HR) function across all industries today. For a specialized ﬁeld such as oil and gas, the challenges are enormous. Why is it so difﬁcult to attract new talent?There are three main reasons. First, industrial activityacross the world is at an all-time high, which has createdmore jobs and thus shrunk the availability of personnel.Second, the oil and gas industry has been hurt over the past20 years because of its cyclicality and public perception.Third, the “baby boomer” generation is approachingretirement and the younger generation is not in sufﬁcientnumbers or experienced enough to ﬁll the gap.NEED FOR A NEW STRATEGYConsidering the above realities, there is a dire need fora completely new recruiting strategy to ensure that thatthe industry’s aggressive growth targets are not choked by come to the astronomical ﬁgure of USD 300 million.these challenges. The need of the hour is to shift from Recruitment costs are not always apparent but, if nottraditional reactive recruiting toward more proactive curtailed, can have a huge impact on a company’srecruiting, clearly understanding the various factors of bottom line.the job market. This recruiting strategy must take into 4. Time factor. Attrition results in hugeaccount the following realities. expenditures of time for management, supervisory, 1. Aggressive growth plans. The entire oil and and administrative personnel, not to mention lostgas industry is poised for major growth, particularly productivity.in the Middle East/North Africa region, Russia/CIS 5. Intellectual property. Many research &countries, and the Asia Paciﬁc region. This calls for development-based organizations, as well as softwareaggressive people-planning strategies for both the and pharmaceutical companies, are facing the seriousshort- and long term. issue of intellectual property leaving the company along 2. Retention. The oil and gas industry is bleeding with departing employees, which affects the wholefrom high attrition. In the service sector, the average organization. Of late, this has become a serious issue inattrition rate for 2006 was 23%. There are several the oil and gas sector as well.problems which crop up if attrition is not addressed 6. Impact on quality and safety. Many serviceproperly. organizations and rig providers worry that frequent 3. Recruitment costs. It is estimated that the changes in staffing and the increase in less-cost for an oilﬁeld services company to replace an experienced personnel will cause safety hazards. Inemployee is USD 60,000. For an organization with addition are the costs of training all these new people25,000 employees and a 20% attrition rate, that would to mitigate safety concerns. Talent & Technology » 21
TABLE 1—NEW REALITIES CALL FOR NEW STRATEGIES THE NEW RECRUITMENT STRATEGY Old Reality New Reality SHOULD INCLUDE THE FOLLOWING ELEMENTS Recruiting is like purchasing. Recruiting is like sales and ✔ Specialized recruitment managers marketing: the organization is the product. ✔ Consolidating recruitment efforts on a global scale Recruit from traditional sources. Look at diverse pools of talent ✔ Raising company proﬁle and aggressively brand and be prepared to train and building develop. People accept offers. People demand much more. ✔ Identifying new talent pools and countries where you can recruit massively Recruit to ﬁll today’s vacant positions. Hunt for talent all the time, ✔ Building long-term relationships with universities every time and plan ahead, and technical schools much further ahead. ✔ Identifying and developing good headhunters ✔ Developing strategic workforce planning ✔ Looking for new recruitment technologiesELEMENTS OF THE NEW STRATEGY ✔ Improving candidate-selection methodsThe oil and gas industry’s unique challenges beg theneed for a new approach when it comes to recruiting.Past recruiting strategies derived from old realities thatare no longer applicable. What is needed is a new strategyoriginating out of the new reality (Table 1).Specialized Recruitment Managers. To develop a packages right, develop your own people to be greatsuitable strategy for the organization, a recruitment managers, create a strong culture, and market yourselvesmanager must have a good overall understanding of aggressively, you can be an employer of choice. Thesethe industry as well as a good understanding of his days, a company must be able to attract talented youngown company’s procedures, policies, products, and professionals and train and develop them; attract mid-services. Strong personnel-oriented managers should career hires from the oil and gas industry by being anknow the right kind of people for the company and be employer of choice; and attract mid-career hires fromable to develop strategies to attract them. This position other industries.should be an integrated part of a global and regionalHR team working to implement a strategy across regions New Talent Pools. We need to promote our companiesand countries. The position should be considered a both inside and outside of the industry and in newdevelopment role for high-potential managers requiring places that have not been tapped into heavily. Thatmore exposure to other aspects of the business to move includes looking at the supply of rotational expatriateforward in a career. employees from places such as Eastern Europe, India, and China, instead of North America and WesternConsolidating Recruitment Effort. This should be Europe because those locations contain plenty ofaligned at the global, regional, and country level to available, highly technically trained engineers and theyderive maximum beneﬁt for the organization. This currently come at a cheaper cost and often with a betterparticularly applies in the case of promoting an work ethic.organization by making the brand more visible at career Another idea is to look at ex-military personnel infairs and other activities. various places around the world and work to successfully integrate them into the organization. In general, theyRaising the Company’s Proﬁle. The challenge here are good at taking direction, have a good work ethic,is to market the organization by understanding the and are used to traveling away from home for extendedmain things that people want out of a career these periods of time. Organizations also need to obtaindays, among them opportunity for development, travel important information regarding the mobility of certainopportunities, to be part of a great culture, to work with nationalities. We must be certain that any new talenta great manager, and to make money. The money is pools that we select are mobile.not necessarily the most important, but you do have to An important talent pool that most companies doensure that your salary and beneﬁts offer is competitive. not tap into very well is the “passive candidate” talentIn addition to the products, services, and opportunities pool. This generally accounts for more than half ofthat an organization offers, if you can get the offer the labor market, which means if we can tap into it22» Society of Petroleum Engineers
we double the size of the candidates available. Passive To predict personnel and equipment requirementscandidates are people that may be interested in making for the long term, overall business (revenue) growtha move but are not aggressively promoting themselves needs to be understood ﬁrst. It is important that HRin the job market. If they can be reached, there is less personnel become involved in the budgeting process tocompetition at the selection stage and studies show that help management develop long-term workforce plans.they are signiﬁcantly more loyal than active candidatesand also slightly better performers. How do we reach Recruitment Technologies. Once a candidate has beenthem? Marketing, referrals, headhunters for starters attracted to the company, you must ensure that he canbut we need to work further on developing ways to easily apply for a position and that his informationattract them. is professionally managed. Current systems utilizing email and spreadsheets are not considered suitable for aUniversity and Technical School Relationships. We company with thousands of employees and an aggressiveneed to start looking at who is going to manage our ﬁeld growth plan.operations, who is going to represent as to our clients, Recruiting software that allows applicants to applyand, ultimately, who is going to manage the company online, be prescreened, and have data held online arein the future. Graduates are raw potential talent that becoming more popular than ever. This allows applicantscompanies can develop in-house due to their ability and to apply for as many opportunities as they like onceproven appetite to learn quickly. They are cost-effective their data has been entered into the system. It allows alabor at the start, bring a fresh perspective, and provide company to prescreen candidates according to presetfuture leadership talent. All service and operating questions, track candidate ﬂow, and share CVs globallycompanies should be aggressively recruiting and training from a database.this talent pool now. We must also begin working on developing Selection Methods. Every time an organization losesrelationships with technical schools in countries around an employee it costs it an average of USD 60,000.the world. We want students in their early years of study In the case of a graduate, where a year is spentto know about our organization and have them want to training, the cost can be USD 150,000. It is costlybecome part of the company long before they graduate. to select the wrong candidate for the job. It is alsoDeveloping relations can involve attending career important that all personnel who play a role in thefairs, conducting company or technical presentations, selection process are properly trained in the art ofproviding internships, awarding scholarships, interviewing and selection.conducting joint studies, donating software, and Shifting the approach from the old reality to ﬁt thisregularly making visits to ensure that faculty members new reality will be very signiﬁcant for companies goingknow the company. forward. The success of the HR function is going to depend largely on the ability to come up with creativeRecruitment Resources. Most oilﬁeld service companies and innovative solutions regarding every subfunction ofcurrently rely heavily on recruitment agencies to help ﬁll HR and, in particular, recruitment. ❖positions. This must continue because it is a great way toﬁll difﬁcult positions. We need to ensure that we identifythe best sources for talent and give them the majority ofour business. We must also establish good relationshipswith agencies in places where talent pools exist but wherethe company may not have operations. We must alsowork on developing relationships with a wide network oftop-notch headhunters and keep track of our successes MANOJ PARMESH is Country HR Manager forwith them. This is a good way to tap into the passive Weatherford’s India Business Unit, overseeingtalent pool. 500 plus employees across 25 nationalities. Prior to his current position, he was head ofWorkforce Planning. To properly implement a new HR for VKL, an exporting company based inand more aggressive recruiting strategy, we must ﬁrst Cochin, India, and began his career with Thejounderstand what our long-term requirements are going Engineering Services in Chennai, India. Parmeshto be. Many of the positions that we recruit for (e.g., graduated with a degree in physics fromengineers) will not actually contribute to the business Victoria College, Palakkad, University of Calicut,for a year as their training period is extensive and they Kerala, and has done post-graduate work inmust work alongside a supervisor. Graduates we hire this personnel management from NIPM in Calcuttayear are not actually for 2008 but for 2009. How can we and in management at the Indian Institute ofrecruit graduates for 2009 if we don’t have any idea of Management.what our needs are going to be? Talent & Technology » 23
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