Talent Management in Indian Upstream Oil & Gas Sector

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Talent management in Indian upstream oil & gas sector

July 2010 www.deloitte.com/in

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Contents

Talent management in Indian upstream oil & gas sector Abstract TheIndianUpstreamIndustry KeychallengesinIndianupstreamindustry TheSolution TheDevelopDeployConnectModel Developingperiodictableoftalent Workplacesoftomorrow Stateoftheartretentionstrategies People-to-peopleknowledgetransfer Examplesofhowusedduringlifecycle People-to-contentknowledgetransfer Target Sell Deliver Learn ExplicitKnowledge TacitKnowledge KnowledgeIntensiveEnterpriseframework Conclusion AbouttheAuthor

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Talent management in Indianupstreamoil&gassector | 3

Talent management in Indian upstream oil & gas sector
Abstract Overthelastfewdecades,averageageofworkforcein Indianupstreamoilandgasindustryhasincreasedtofifty years.Whetheronebelievesitistheresultofnormally occurringcompetition,attrition,agingorrestructuring, onethemepermeatesthecurrentdiscussionaround humancapital:howtodevelop,deploy,andconnect employeesthroughtheindustry’sboomandbustcycles? Thisissuehasbecomeparticularlycriticaloflate,giventhe sector’sagingworkforce,combinedwithadiminishing pipelineofnewandexperiencedtalent.Toguardagainst corporatebraindrain,companiesneedtoformulate effectivestrategiestoattractandengagetheindustry’s newestresource:YoungerGeneration(below30yearsof age).Howeverhiringyoungergenerationisnotall.Itis alsoaboutmanagingexistingtalentanddevelopingthe periodictableoftalent. The Indian Upstream Industry Theinitiativewastakenbythegovernmentbyintroducing NewExplorationLicensingPolicythroughwhichitstarted theauctioningofhydrocarbonblocksforthePublicas wellasprivateoilandgascompaniesbothIndianand foreigncompanies.Thepolicyofferedfavorablefiscal andtechnologicalincentiveswhichattractedmany domesticandforeignoilandgascompanies.Tillnoweight NELProundshavetakenplaceinwhichmorethan250 hydrocarbonblockshavebeenofferedforexplorationand production.Nowovertwodozenoilandgascompanies areoperatinginIndianblocks.Theexploredareashave goneupto85%andaround115discoverieshavebeen made.ThisintenseactivityinIndianupstreamrequires manpowertosustaintheoperations.Tosustainthisintense activitylargenumberofpeoplewithrelevanttechnicaland managerialexpertisewouldberequired. Key challenges in Indian upstream industry AccordingtoastudyconductedbySocietyofpetroleum engineersin2006,theglobalE&Ppetrotechnicalstrength wasexpectedtobearound375,000.Consideringthe rapidriseintheE&Pactivityacrosstheworld,thetotal deficitofthesuitableskillisestimatedtobearound30,000 professionalsbytheyear2012.Indiaisalsoplaguedbya similarproblem.Thisproblemmayworsenonaccountof loomingshortageofoilandgasworkers.Someofthemost concerningimpedimentsare: • IncreasedE&PActivity • Scarcityatentrylevel • LowIndustryAwareness • LowIndustryAttractiveness 4



BetterOverseasOpportunities NegativePublicPerception IndustryCyclicality AgingWorkforce LateralHiring KnowledgeRetentionbeforeitwalksoutofdoor

Increased E&P activity ManycompanieshaveinvestedinE&PactivityinIndiaand asaresultthequantumofE&Pactivitieshasgoneup.The projecteddemandofkeyskillsisexpectedtobeapprox 9000(by2016). Scarcity at entry level TheIndianeducationsectorpreparesaround400+ studentsinE&Prelatedgeosciencescourses.Moreover, only56%ofthetotalpassingoutstudentsjoinsE&P companiesand12%arehiredforoverseasoperations. Thereisshortageofyoung...
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