OPEX: Shell and leadership churn
Thoughts from Royal Dutch Shell's Michiel Van Noort
I'd listened to Michiel speak for close to an hour on his experiences working in operational excellence. He's a great talker - fast, and entertaining - and it's difficult to get a chance to discuss anything once he sits back down, a crowd of people around him.
"I can get very passionate about improvement", he says when I finally get a moment to speak with him, coffee in hand, and for the next ten minutes, he answers every one of my questions with aplomb.
Leaders and leavers
Leadership churn, I remember him saying. I wrote frantically during the presentation, but I haven't much for this - so I ask him. Just how does one sustain a continuous improvement strategy when the key decision-makers keep changing?
"There are a couple of things.. the leadership is important because it drives the organisation, and we need to keep those leaders engaged."
Fair enough, I say. Easy to say, hard to do. He seems unconvinced - sort of, yes and no. So how do you do it?
"You can consciously manage your stakeholders, see where they are, meet them where they are, and keep them filled in. It can be by creating an ecosystem of leaders, and the capability that you have in the organisation will reinforce it.
"But I would say the most important thing, and this is a journey over a number of years, is that you actually embed the structural enablers that drive the organisation on a daily basis."
Codifying OPEX structures
I'm not an OPEX professional, nor do I have years of experience in an energy major. He clocks the polite bafflement on my face.
"You codify how the organisation works. How does it do its process management? How does it do its performance reviews and its metrics? That’s one part. The other element is that you also embed it in the reinforcing organisational structure. How do people get recognised, rewarded, promoted? How do they get trained? You do this because those are all elements that are happening on an ongoing basis."
For Michiel, at least, it seems that OPEX is about key structures - not simply a cult of personality. To manage with an ever-changing roster of leaders (and employees) the very nature of the business needs to be codified to be responsive to OPEX. Like a business strategy, it has to be larger than any one person, and, crucially, subconscious.
"Everybody coming into an organisation goes through this - completely subconsciously. And when your strategy becomes subconscious, people will not know any different: 'this is how you work in this company'."
Management and Band-Aids
I wonder aloud if a good atmosphere for OPEX is simply effective management.
"It’s expected that if I do my daily job like this, if I manage my performance like this, if I behave and show these values, then I will be promoted and recognised."
See also: OPEX interview with BP's Hugo Ashkar.
He pauses; I sip my coffee, nodding. I can't help thinking that this is all well and good, but what happens if your leader moves during this phase. Before I can ask, he continues.
"At the end of the day, it’s about building that ecosystem that sustains continuous improvement - but when there are short-term changes in leaders...? Then you have to put on Band-Aids."
The fabric of OPEX
I ask if he would say that really, employees just need things to feel as normal as possible - to feel like they’re a part of the fabric of the business.
"Yes", he says, "that's the key point: you need to recreate the fabric of 'this is how we manage and run the organisation on a daily basis'. You need to restructure the processes, the tools, the systems, the rewards. That’s also why these CI or operational excellence journeys are so hard.
"Often, people talk about all the technical interventions that they’re making - 'I’m doing a bit here', and 'I’m now focussing on process', or 'I’m doing a bit on leaders', or 'we’re changing the training' - and in these situations, even though all of them are part of it, the ecosystem contains so many different elements, you need to cover them all if you really want to make it sustainable.
There are companies that have been on these journeys. Previously, I was with General Electric - and we were doing this in the 80s. They are still focussed on it and they still have revamps and reboots because new people come in, the business refocuses, challenges emerge, and new methodologies like agile are introduced. You need to keep it ever fresh."
He checks his watch. Very comprehensive, I tell him.
"Told you I was passionate", he smirks.
If you enjoyed this interview, look out for the second part next week.