KM Investigates: The Strategic Human Resources Approach for a Global Corporation

Katherine Mehr

A Closer Look at the Oil and Gas Industry

The global economy is currently facing critical challenges regarding talent management. The baby boomer mass retirement has created larger gaps in organizations, and the downturn of the financial market over the past few weeks has taken a large toll on the performance and productivity of many companies.

The demand for oil and gas has been promising; however, on the talent management front—not so much. The workforce of this industry is compiled of employees with specialized skills specific to the roles and responsibilities needed to execute and meet overall organizational goals. Decisions on human resources initiatives become much more of a strategic process when referring to global organizations with a specialized but diverse workforce.

e-BIM editor Katherine Mehr speaks with Joe Laymon, Corporate Vice President of Human Resources for the Chevron Corporation, about the specific needs for global workforce talent and the criticality of having an human resources strategy that is aligned with the company’s business strategy.

What is your mission statement and how do you communicate it across all of your offices?

Our guiding principles can be found in The Chevron Way, which establishes a common understanding for our vision, values and corporate strategy. Our vision is to be the global energy company most admired for its people, partnership and performance. The Chevron Way is a set of values that we believe distinguishes our employees and guides our actions towards this vision.

So what are these values? I am referring to integrity, trust, diversity, ingenuity, protecting people and the environment, partnership and high performance. These values and the vision are then coupled with our corporate strategy to ensure we’re translating beliefs into actions.

All employees learn about The Chevron Way as part of their new-hire orientation. In the short time I have been with Chevron, I have been especially impressed with how employees truly embrace these important qualities.

What are Chevron’s best practices in terms of human resouces and strategy?

Our priority is long-term employment. We want to develop, motivate and retain a technical workforce—both in the United States and abroad. Our talent development strategies and programs are critical to accomplishing this business goal, and I think we’ve got a number of best practices that are helping us lay that foundation.

I believe it is critical, however, for any human resource strategy to be completely aligned with the company’s business strategy. Chevron’s business strategy—to develop leading, integrated positions in growth areas of the world—means that human resources must develop and support programs to allow our businesses to do just that—hire and retain employees in the global arena.

What challenges, specific to the oil and gas industry, do you face that affect human resourcs departments within your organization?

Within the energy business, there is a specific need for global workforce talent. For Chevron human resources, this translates into an international strategic staffing initiative. Of the more than 59,000 employees in our workforce today, more than half are outside the United States. That’s compared to 1999, when only one-third of our workforce was non-U.S. employees. This is a significant cultural shift that requires our attention.

We need to understand and balance the short and long-term needs of our people and leverage our talent so that we have the right people with the right capabilities in the right places. In addition, the average employee age for our global workforce is 43, so leadership development, career management and planning, as well as processes to retain staff are all critical.

On a global human resouces level, you empower your local offices to make local-specific decisions. You may not be able to make the decisions directly for these offices, so where do local decisions stop and the strategic global decisions begin?

Each company affiliated with Chevron is a separate entity that manages and controls its own affairs. This decentralization is crucial to our success. Within human resources , we’ve seen the benefit of this type of arrangement, and after the recent hurricanes, employees can attest to the success of the model. After Hurricane Ike hit Houston and the Louisiana coast, local human resources managers were best equipped to understand, react and activate necessary policies and procedures. Providing a top-down approach from a conference room in San Ramon would not have been effective.

There is no "line" for where those decisions begin or end. Rather, I think it is the job of our corporate human resources department to develop the necessary programs and policies to allow our businesses to thrive.

We operate on a "pull" methodology rather than a "push" approach. And it is my belief that our local entities are best equipped to thoroughly understand the needs of their workforce.

First published on Human Resources IQ.