Deloitte: Time Right to Reinvent Human Resources Profession in Oil, Gas

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The human resources (HR) profession can take advantage of Australia’s changing oil and gas marketplace to evolve and improve how it meets the demands of the industry, according to Julie Harrison, human capital partner at Deloitte Australia.

Ahead of the professional services company releasing its 2015 Global Human Capital Trends this month, Harrison provided an insight into the top five issues and challenges facing the Australian oil and gas industry:

  • leadership
  • culture engagement
  • learning and development
  • workforce on demand
  • reinventing HR

Despite being fairly consistent with the trends of previous years the extent of how important each issue currently is has adjusted to reflect an Australian industry now in a transitional phase.

Julie Harrison
Julie Harrison
Julie Harrison, Human Capital Partner, Deloitte Australia Source: Deloitte Australia

Major projects in the country’s booming liquefied natural gas (LNG) industry are largely moving from construction to operations, while significantly lower commodity prices have forced substantial labor and cost cutbacks at all levels.

TIMELY FOR HR REINVENTION AS AUSTRALIA’S LNG SECTOR MOVES INTO OPERATIONS

Harrison believes this has created an opportunity for reinvention from a human capital perspective as the growing importance of leadership, organizational culture, and learning and development come to the fore.

“The timing is right to really take a good look at HR and do some great work to reinvent it by making sure it is really focused on being part of the business strategy,” Harrison told Rigzone on the sidelines at the Australasian Oil & Gas (AOG) Exhibition & Conference in Perth this week.

“Looking at commodity prices you have to be really focused on the size, scope and scale of the HR function, and what is right for the business and the environment.

“This would really be a great thing for the HR function to be doing, to be on the front foot about it instead of being forced to do it by the business.”

Deloitte’s research for the report has involved surveys and interviews with more than 3,300 business and HR leaders from 106 countries, with oil and gas a prominent industry reviewed in Australia.

DELOITTE EMPHASIZE NEED FOR HR PROFESSIONALS TO BROADEN SKILLSETS

From the Australian findings Harrison said it was clear that HR professionals needed to broaden their skillsets to become a more valuable asset to help oil and gas companies overcome the challenges.

“Companies are needing absolute specialists from a HR perspective and need to make sure that their HR business partners are acting very much as strategic business partners,” Harrison explained.

“Are they acting as HR analysts or business partners that are really helping to drive and align the business strategy?

“There are organizations that do this well and there are some fairly senior HR people that do it well, but generally speaking most are still on the backfoot and seen in the main as service deliverers, as opposed to really coming into the 21st century and being proactive.”

Harrison added that HR professionals were being challenged to move beyond what was comfortable to adopt new skills, with improved knowledge of operational data and analytics a key focus area.

“They are actually really valuable skillsets in HR and will help them to be more aligned to where the business is going,” Harrison explained.

“Looking at the style of organizations in the oil and gas industry they still seem to be very engineer centric, and engineers love data in general, so it becomes how do we from a HR perspective become more comfortable with the idea of using data to make decisions, which is what organizations are really looking for.”

By effectively achieving this reinvention oil and gas companies would, of course, improve productivity and lower costs within the business, Harrison continued.

Deloitte: Time Right to Reinvent Human Resources Profession in Oil, Gas
Projected Oil, Gas Employment Level in Australia

With Australia falling behind its counterparts in both areas Harrison expected development from HR in this area to help the local industry efficiently move into the operational phase of LNG and adjust to the current market environment.

“The whole idea of directing employee engagement is fundamentally important, as is understanding cost structures,” Harrison said.

“Negotiating different deals as you move from major capital projects to operations, with different employment contracts, you can actually reduce costs as opposed to the project related costs. Those directives are what we are starting to maintain to manage the costs associated with that.”

 

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