Never Waste a Crisis

I just read a very interesting email exchange between my colleague, Bill Haskett, and an oil & gas acquaintance of his.  Like most upstream O&G companies, this one is being hit hard by the downturn in oil price.  Bill’s friend said they were close to “throwing the cannons overboard,” a nautical reference to getting rid of everything that is non-essential to survival in the here and now.

Bill’s reply was the following: “I prefer a physiology metaphor myself. When the human body is injured or attacked it prioritizes what to save. It preserves two things beyond all others: central circulation and the brain. The ability to function physically and mentally. The companies that will survive will be those that preserve their ability to make good decisions and the ability to carry out those decisions.”

I could not agree more.  The industry has been hit hard, no doubt about it, and after more than a quarter of a million layoffs, most companies are down to a core group of talent that they would like to preserve.  One might think that those survivors’ workloads have been doubled, but with so many projects put on ice, the reverse is often true: employees have less on their plates than they did before the price drop.

It’s a perfect time for personnel development in the form of training courses.  In fact, several of our clients have approached us about providing such training (for more information about the variety of customized courses we offer, email us at contactus@decisionstrategies.com).  Training engages staff who may be suffering from “survivor’s guilt,” it sends the message that the company is still willing to invest in them as valuable employees… and it costs a whole lot less than a new capital project.

Now, I am obviously biased here; we at Decision Strategies would like nothing better than to get additional revenue from delivering training workshops.  But I also honestly believe the point Bill made.

If you think the energy industry is complex now, just wait.  The downturn in oil price is just one of several challenges.  In the past four months I’ve gone to the Energy for Tomorrow conference, the On Sustainability conference (at which I made a presentation), and the Green Biz conference.  Only the truly delusional think that the energy mix twenty years or even ten years from now is going to be the same as it currently is.  Energy companies that want to thrive for more than the next decade are going to have to figure out how to remain relevant and profitable as we go through the biggest energy transition since the steam engine.  That is an enormously complex problem.

But for some companies, it will be an enormously complex opportunity.  Those who have chosen to up their game when it comes to finding creative, robust strategies, those who recognize the need to understand the full range of possible outcomes associated with their strategic alternatives (as opposed to trying to forecast what will happen) – in short, those who don’t waste this crisis – will be best positioned for success in the coming years and decades.