Generation TNK-BP

Five years after inception, the notions of “Key performance indicators” and “Personal development program” and the question “What are you going to study this year?” have become common across TNK-BP.

So far the company has spent more than $70 million and 180,000 man-days on upgrading employees’ professional skills and instilling the knowledge needed to be competitive and successful in the 21st century. Much as a result of this continuous improvement, 2,166 employees of TNK-BP Management, or 65% of the organization, have been promoted or moved into new positions within the company.

TNK-BP’s Human Resources (HR) team, enriched by its combination of international experience and knowledge of Russian realities, has developed an educational system for all layers of the company workforce and a liaison strategy with key Russian universities teaching courses relevant for the oil and gas industry. The evolution of TNK-BP’s approach to people development mirrors the progress of the company towards its long term strategic goal – to become a leading global oil and gas company.

Lost in translation

A central tenet behind creating TNK-BP was to derive exceptional value from the combination of Russian assets, people and experience with BP’s global industry knowledge and business processes, skills and technology.

The initial imperative was to create TNK-BP’s own distinctive corporate culture, so that employees who joined from BP, TNK, ONAKO and SIDANCO – the so-called heritage companies – began to feel they belonged to one united team, different and distinct from any of its heritage firms. Without success in this early, vital objective there seemed little point in bringing all these groups of people together.

«One of the distinctive features of TNK-BP’s internal culture has been the unique range of professional and personal development offered to all our staff. As well as providing individuals with great opportunities for improvement, this materially enhances our organisational capability and has a direct and positive impact on our business performance.» — Tim Summers, Interim CEO TNK-BP.

One of the powerful lessons from the TNK-BP merger experience (which, happily, emerged early in the firm’s existence), was that a new corporate culture was bred, propagated and reinforced through the simple act of working and delivering clear business results together, in mixed teams. The process of jointly clarifying the tasks at hand, allocating responsibilities and the two-way learning process of “doing” together was soon seen as easily the single most effective instrument to drive mutual respect and learning and a new performance culture into the company. This process captured people’s enthusiasm for the potential of the new company they had joined and provided visible and tangible evidence of the unique potential of TNK-BP. Soon afterwards a new reward-based and harmonized compensation and benefits policy began to be rolled out across the company, and salaries and bonuses were transparently linked to performance. This provided further stimulus to utilizing all the potential talents within what was increasingly being seen as one unified TNK-BP workforce. Heritage pride remained, but the prejudices were fading.

Key facts about TNK-BP people development

In 2003—2008

• $70 mln spent on training and development
• 180,000 man-days in training and professional development
• $15.2 mln spent on university support
• 2,351 college and university graduates joined the company in 2004—2008
• 84% are graduates with higher education

Knowledge focus: Seeing is believing

One of the first things was to show a limited number of leaders within the company and key staff how business is done in other parts of the world. There were visits for managers at different levels to BP operations in the North Sea, Alaska, Houston and Aberdeen with the sole purpose – not just to tell, but to show. In its first two years, the company organized 300 such visits, and “after that we stopped counting,” says Clark Cridland, Vice President for Human Resources since Day 1 till the middle of December 2008 and the principal architect of TNK-BP’s approach to training and development. “Reactions of the Russian staff were as different as you could imagine, but people were professionally energized,” he adds. “It’s not that BP has a magic formula. It was an opportunity to see how work is done in different places and in more than one country.”

“Over 10 days in Aberdeen, I learned much more than in any business school. British colleagues who were older and working in higher positions took time to explain to me the specifics of financial analysis,” says Alla Konovalova, Senior Manager in the Training and Development Department. “I could immediately apply my new skills and knowledge upon my return to Moscow. In my view, it is this kind of experience-sharing and knowledge-transfer that lies at the heart of the success of any company.”

These early visits were complemented by a reverse secondment program, under which selected TNK-BP employees were given a chance to work in BP offices in other countries for a year or two. The purpose was to gain usable international experience or, in other words, “to build particular skills and to open people’s minds,” as Cridland puts it.

In 2003—2004, at the same time as the company was developing and introducing new HSE standards and procedures, it was also conducting comprehensive due diligence work on its environmental legacy. The company needed professionals not only with good knowledge of Russian specifics but also with international experience. Supported by the Corporate HSE department, Oksana Kondratchuk had the opportunity to study international remediation practices at the Atlantic Richfield Company (a company affiliated with ВР) in the United States for two years.

“Working on specific projects and attending specialized training courses on remediation and hydrology I learned an additional specialization, but also studied a new field of expertise,” says Oksana Kondratchuk, Manager, Company Commitees and Executive Support, Chief of Staff. “My direct responsibilities included strategic planning and managing various remediation projects, projects at fuel stations, oil depots, and the Carson refinery in South California and liaising with regulatory authorities and non-governmental organizations. In addition to technical knowledge in the areas of environmental protection and remediation, the experience I gained on the reverse secondment program was also a valuable personal development experience.”

Managing the change

In the early stages, TNK-BP needed a leadership group who would help usher staff through the sometimes painful initial stages of merging with other firms and cultures, and who understood and could explain the need for the transformation the company was embarking on.

Thunderbird Business School in the US, ranked No 3 in the Wall Street Journal 2008 Survey of Executive MBA’s, designed a tailored executive training course providing a new kind of exposure  for senior managers (regardless of heritage or business experience) and introduced them to case studies and lessons from global oil and gas and cross-cultural businesses.

 INSEAD Business School in France designed and delivered an executive training program for the next level of management. The INSEAD program comprises three one week modules, each in a different international location – Moscow, a town near Paris and Singapore. The modules are spread over two years and concrete TNK-BP projects are workshopped as part of its curriculum. INSEAD has educated 120 people from across the organization and this program enjoys a well-earned reputation, as evidenced by a long waiting list!

“INSEAD is an interesting training program,” says Nikolay Kapitonenko, Head of the Bitumen Performance Unit. “But most importantly, the format of the course gives a great opportunity to its participants to get together, discuss current issues and company strategy, share their views and experiences, and also to feed this back to senior management. INSEAD is a perfect platform for networking and teambuilding.”  

The first years of TNK-BP also saw an influx of secondments from BP, reaching 165 specialists at peak. Secondees were mostly technical and commercial operations managers as well as petroleum engineers from BP Exploration who remained employed by BP but were sent to our company on a clearly defined mission. The secondees were to possess two key qualities: (a) particular skills or understanding of technology or a business process, and (b) skills at communicating this knowledge to the Russian staff.

Learning pyramid

After the first two years of the company’s existence, the HR team designed a “learning pyramid” tool, reflecting different employee groups in need of different sets of skills. HR managers referred to the process as “segmenting the population of the company.”

TNK-BP professional development programs

“Despite the current economic environment, the company strives not only to preserve the existing organizational capability, but also to continue its development in the disciplines most critical for business”. — Denis Kryanin, TNK-BP Vice President for Human Resources.

The underlying purpose of the training system was to develop local talent and position the company as the best employer in Russia. In this way the company would solve one of the most acute problems currently facing the global oil industry – a real shortage of dedicated professionals and experienced managers.

In 2006—2007, two tasks emerged as the next priorities. One was a focus on supervisors, i.e. managers who work on site. In 2006, a special program called ‘Perspective’ was introduced for “first level” managers. In two years, 6,000 first level supervisors graduated from Perspective.

“The Perspective program was a new interesting experience for me. In the past I only attended specialized technical courses, and I was skeptical about personal development training. But Perspective met my expectations,“ says Roman Zaets, Head of automatization and IT at JV “Yugragaspererabotka.” “In my view, this course is valuable because it helps to develop leadership and management skills and competencies.”

According to Roman, the Perspective program offers a set of tools and techniques that allow managers to evaluate personal decisions, actions and final results, to assess what was done in the right way and what could have been done differently. Much attention is focused on topics such as time management, effective personnel management, motivation systems, delegation of authority, coordination of team work, and conflict management. The themes offered at the training course can be immediately applied in practice.

“This program would be useful to anyone who is open to new information, who is striving to build management skills and develop professionally and individually,” Roman says.

The second program launched at the same time is called ‘Three Horizons’, a program to develop company awareness, basic business skills and leadership potential among university graduates during their first three years of employment. The first horizon is “me and my company,” where young specialists learn about company values. The second horizon is “me and my profession,” involving a series of training courses to develop professional, leadership and individual skills. The third horizon is ”me and my career.” This program stretches over three years, each year representing a key phase of a young specialist’s development. It combines formal courses, on-the-job mentoring, projects and other tasks to develop technical and professional skills. It also develops the basic business skills and leadership potential of recent university graduates, and nearly 1,000 young specialists in TNK-BP currently participate in this program.

”Two years ago as a recent graduate, I came to Samotlorneftegaz at TNK-BP. Everything was new to me: new people, new team,” says Eugeny Gorbunov, a young specialist from the ”second horizon” and a senior technical specialist at SNGDU-2. “As part of the Three Horizons program I participated in various training courses, which helped me not only to improve my professional, but also personal skills. When I joined the company, I worked for one month as an operator in oil and gas production, but when I moved to the technology division, I had to deal with a lot of new information. Training courses as part of Three Horizons helped me analyze information, take what is important and leave out irrelevant information.”

Three Horizons helped me integrate into the operational process, develop arguments to defend my position on different issues, work to deliver results as part of the team,“ says Dmitry Sergunin, a graduate of the Three Horizons program, Deputy Oil Field Manager for Geology, SNGDU-2. “But most importantly, the program helped me assess my potential and plan my future career.“

Mentoring plays an important role in the professional and individual development of young specialists as well as their integration into the company. Its role has become even more significant with the launch of the Three Horizons program. Mentors – professional specialists with no less than three years of experience – help young specialists integrate into the operating culture of the company, explain its values and help solve issues that young specialists face at all three stages of the program.

 “Training is an integral part of the daily work,” says Vadim Podustov, Deputy Oil Field Manager, SNGDU-2, Samotlorneftegaz, and a mentor of young specialists. “We try to immerse young specialists into our operating environment right from the start by setting very specific targets. Their responsibilities are comparable with those of senior specialists. We monitor their work monthly and evaluate performance delivery, their strengths and weaknesses and perspectives for future professional growth.”

Finally, the company’s ‘Ascent’ program for potential senior management presents a combination of a succession plan and personal development. To date it has developed and broadened 120 people.

Ascent is a program for leadership development, but most important — it is an excellent framework for building a network of contacts with colleagues from other business streams to exchange opinions and experiences. This is the primary advantage of the program,” says Marat Atnashev, Director for Major Projects and Engineering, Acting TNK-BP Vice President for Major Projects. “I worked at Kamennoye for two years and during that time it was especially important for me to maintain contacts with colleagues in Moscow and other regions.”

Ascent forums are another important aspect for the professional development of company leaders. These forums provide a unique opportunity for Ascent members to hear expert opinions on wide spectrum of issues from successful leaders and professionals from different areas and contribute to succession planning and personal development training.

Customized approach

Apart from an established set of general leadership and management programs aimed across the whole  TNK-BP organisation, the company has at its disposal a number of customized training options catering to specific, focused individual and skill-specific needs.

Primarily this comprises technical training, which was first delivered by TNK-BP’s Technology business-stream. A standalone Technology business-stream in the company structure was itself an innovation in the Russian oil industry and provided a productive collegiate structure and atmosphere in which tough technical challenges could be examined and solved through pooled knowledge and teamwork.          

Technical training in core disciplines, 2008*

^*

As of September, 2008.
Total of man-days delivered in technical training – 10,367

It was only natural that technical training was part of the knowledge-sharing happening in TNK-BP’s Technology business-stream. “In the first three years we picked the low-hanging fruit,” Clark Cridland says. “The original courses tackled obvious priority matters like water flood management.” Then, at the beginning of 2007, this technical training was moved from Technology to Human Resources (HR) to broaden it. Now there is a documented curriculum in technical training.

“Having attended the technical course ‘Supervision of operation and workover processes for wells equipped with ESPs’ at the Schlumberger training center in Tyumen, I had a great opportunity to study the specifics of the well rate stabilization process and practise the immersion and lifting of ESPs as well as the dismantling process,” says Alexey Lukoyanov, a technologist from Nizhnevartovsk oil- and gas-producing company, one of TNK-BP’s subsidiaries. “Thanks to the intensive three days of theory and hands-on practice, I feel more confident and apply the knowledge I gained in my daily work. Next year, I am planning to attend two more technical courses on the technology of oil and gas production and on increasing time between pump failures. Technical courses allow me to learn new technologies, share experience with colleagues and hear expert opinion from trainers,” says Alexey.

“I could apply the knowledge and skills that I improved during the course ‘Modern technologies in work-over operations’ right away,” says Alisher Rakhmanov, a chief specialist in current work-over operations at Nizhnevartovsk oil- and gas-producing company.” One of the themes was alternative ways for casing leak repair, including the dual packer completion. And currently we are using this method at one of the wells at Permyakovskoye oilfield. Such specialized courses with hands-on practice are very useful. They open new horizons.”

TNK-BP’s HR team has proved able to quickly react to the needs of different business functions. For example, two years ago the company created a separate gas stream to build our gas business. In connection with this, TNK-BP developed a relationship with a university in Amsterdam, which established multi-week development programs on gas for employees and for future professionals from Russian universities that we support.

New blood

It’s a well-known fact that the average age of a petroleum engineer or a driller – two core professions in the oil and gas industry globally – is between 45 and 47. Unless the industry encourages experienced technical and professional talent to remain, and encourages new graduates to join, a serious shortage of qualified personnel may pose a major challenge to the stable future supply of oil to world energy markets.

TNK-BP has now built relations with ten partner universities across Russia with a dual objective in mind. As the third—largest oil company in Russia, we take an active part in improving the quality of petroleum education in the country. At the same time, the company is keen to help improve the quality and relevance of coursework completed by graduates so they can make a greater and earlier contribution to the company’s performance upon recruitment. A fortunate byproduct of this university partnership program is the chance to spread the word about TNK-BP career opportunities to help recruit the best young Russian talent.

In 2007, the company spent $2.5 million on 18 university projects selected via an open tender. This year the allocation was raised further to $3 million. In addition, last year senior managers of TNK-BP held 27 master classes in seven key disciplines at major Russian teaching institutes and universities. In 2008, 20 master classes will have been held by the end of the year at universities across the country ranging from Tyumen to St. Petersburg to Moscow. In 2008, TNK-BP established a world—class Geoscience Master’s Degree Program at the Tyumen State Oil and Gas University. The program will deliver a curriculum linked to a leading international university, with the ultimate goal of producing geoscientists ready to manage the growing complexity of TNK-BP’s technological solutions to key oilfield challenges.

Graduate recruitment

Partner universities

Intake across key specializations

1. Tyumen State Oil & Gas University [TSOGU]
2. Samara State Technical University
3. Gubkin Russian State University of Oil & Gas [RSU]
4. Ufa State Oil Technical University
5. Tomsk Polytechnical University [TPU]
6. Irkutsk State Technical University [ISTU]
7. Moscow State University (Geology Faculty)
8. Arkhangelsk Institute of Oil and Gas (from 2008 year)

Intake across other specializations

1. MGIMO
2. Higher School of Economics

Sometimes, where there is a clear lack of the specific human capability the company needs, TNK-BP may even establish a new educational venture. A good example of this is the Irkutsk training center created by TNK-BP in partnership with the Irkutsk Technological University. The center provides modern technical training for TNK-BP subsidiaries in East Siberia; teaches best practice in drilling, safety and performance management as well as leadership skills and the English language.

”I have been working as a department head for 10 years, but only 2.5 years in the oil and gas sector. In the Irkutsk training center, I attended a professional development course called ‘Introduction into the oil and gas industry’,“ says Olga Uvarovskaya, Head of the design planning section in the department of capital construction planning at Verkhnechonskneftegaz,“ In my opinion, any training brings a result. Geology and drilling were two especially interesting and valuable aspects of the training. I now feel much more comfortable with this kind of operational information during meetings.“

Grass roots

There is a further variety of training which has embraced all TNK-BP’s employees. The company has introduced important processes in evaluation and remuneration – performance contracts and short-term and long-term reward programs. These include objectives at all levels of the company, both for business divisions and individual workers. “It has become crystal clear for everybody what is expected of them and how they will be rewarded if they deliver,” Clark Cridland says.

In 2004—2005, human resources specialists carried out a specific training program for 3,500 TNK-BP people from across the company, teaching them how to prepare key performance indicators (KPI) and personal development plans (PDP), setting out work targets for the year ahead, plus specific training plans and clearly defined professional goals.

The new processes introduced transparency and reliability in measuring the performance of businesses and staff. They have existed for five years at head office and with a minor lag have also been introduced at regional subsidiaries.

The HR team conducts regular surveys to monitor results and check how the system works, polling 3,000—4,000 employees at a time in all locations.

Reading the crystal ball

What does the future hold for TNK-BP’s people? The five years since 2003 have shaped a generation of TNK-BP – a team of people trained and developed to be the best in the business.

For five years TNK-BP was a joint venture start-up company, which to a considerable extent dictated the need for certain strategies and people skills. Now the company is entering a new phase of its life – with less direct human resource support from its shareholders and more ambitious and complicated goals.

“We need to pause in our HR policy, look across the things we are doing and identify the gaps,” Clark Cridland says. “We are not operating in a vacuum. Other companies are catching up with us, which was not the case five years ago when we were unique. However, one of the company’s attractions remains: People in the market know the company gives training, development and learning opportunities – an essential component of self-realization.”

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  Generation TNK-BP (576 KB)