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Why upskilling is key to oil & gas digital transformation

A new EY survey found that 90% of industry executives agree that investments in technology and workforce are key to current market survival.

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COVID-19 has accelerated digital transformation timeliness across the board — and the oil & gas sector is no different. 

According to a new EY survey, 90% of O&G executives said that investments in technology and a strong, skilled workforce are needed for the sector to withstand current market conditions.

The Oil and Gas Digital Transformation and the Workforce Survey 2020 also found that 58% of executives said that COVID has “made investing in digital technology more urgent, with a majority planning to invest a great deal (29%) or moderate amount (51%) relative to their total budget.”

As EY Global Oil & Gas Leader Andy Brogan explains, the pandemic has had a major impact on DX timelines, shifting adoption from five years to three months.

“The cost savings digital can deliver for organizations is critical for survival in today’s low-price environment, as oil and gas companies look to gain greater operational efficiencies and drive productivity across the value chain. However, to capture the full value of these investments, oil and gas companies need the skills to harness and use the technology to its maximum potential.”

Addressing skills gaps 

The accelerated pace of DX adoption in the sector brings up questions about the workforce, and whether their skills align with the increase in pace. 

The answer is hardly surprising. 

According to the survey, 46% of respondents (on average) report that their current workforce isn’t equipped with the necessary skills to match tech investment. Respondents also report that 60% of their workers need to be reskilled or upskilled.

92% report that reskilling efforts will be key in their success over the next three years.

“It’s not enough for companies to simply spend more on technology,” explained Tim Haskell, US Oil & Gas People Advisory Services Leader for Ernst & Young LLP.

“Investment in the workforce is needed to scale and integrate technologies and ultimately capture the intended value. Companies must find an investment balance while addressing market pressures. Otherwise, the industry could potentially lose crucial years and a generation of workers.”

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Tech agility and relationship building among pillars of digital transformation for CIOs, HBR report finds

A look at HBR’s recent report about the changing role of CIOs and building resilience in digital transformation

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HBR recently released a report (sponsored by Red Hat as part of The Enterprisers Project), on the changing roles and landscapes of Chief Information Officers (CIOs) leading organizations through digital transformation

The goal? Resilience. 

Specifically, resilience in an organization’s people, business processes, and tech infrastructure. 

But don’t get too caught up in the tech just yet. As UC Dublin business professor Joe Peppard is quoted in the report, “digital transformation is less a technology challenge and more a leadership one.”

HBR shares how CIOs can step up to the plate with leadership that fosters resilience amidst digital transformation:

Adaptability for CIOs and the organizations they lead

Digital transformation is a response to change, whether that change is innovation, customer demands, or industry trends. Today’s CIO must prepare their organizations to adapt to those changes, specifically: 

  • Adapt new processes to speed up product development
  • Collaborate to create new business models
  • Respond faster to client demands
  • Experiment and pivot quickly
  • Attract and retain IT talent

To achieve all that, the role of CIO has quickly expanded its job duties. Indeed, 89% of CIOs feel their role has become “more important,” the report found, while 88% agree their role is the most “critical component” of their organization’s sustenance. 

What do these expanded duties look like, apart from leading adaptable organizations? The CIO is an educator, coach, strategic adviser, entrepreneur, relationship builder, and change agent. HBR even includes “evangelist” in the mix. 

Managing expectations, relationships, and talent

Communication and relationship building are increasingly important, even in a tech-dominated industry. HBR cites an IDC statement that CIOs will even out inflation, shortages, and other economic changes through negotiations and relationship building. 

Of course, that communication is vital internally as well. CIOs need to lead staff, managers, and executives through pivoting plans, unpredictable results, and changing expectations. How? Through empathy, a vital component in supporting a successful organization and successful professionals within one. This also includes fostering safety, diversity, personal growth, inclusion, and autonomy for experimentation, and learning from failures. 

Finally, there comes the talent — starting at recruitment, all the way to career development and flexible work arrangements for IT staff. 

Making tech more agile

CIOs can’t do this on their own. However, they can embrace transformation tools and support their organization using them. HBR cites a PwC study on strategies for adapting to new tech tools, including: 

  • Making an IT strategy more agile
  • Using infrastructure investment to move to the cloud
  • Leveraging data and analytics to inform strategic decisions

CIOs aren’t just responsible for securing the new tech. They also need to strategically and operationally decide how to best harness each tech’s capabilities. The answer comes from the entire organization, as business operations and IT become unsiloed to support better collaboration. 

Read the full report

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“Financial growth alone won’t cut it anymore”

UC Berkeley Haas School of Business dean Ann Harrison describes what the future’s successful leaders look like.

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Automation, flexibility, data analytics — these are only a few of the business trends shaping 2023 and beyond. But you can’t implement those trends in your workflow or organization without having leadership on the same page. 

McKinsey & Company recently interviewed Ann Harrison, Dean of UC Berkeley’s Haas School of Business, on characteristics of successful, modern business leaders, and how to improve education models to produce them.

Here are a few highlights from the interview:

On why today’s leaders must lead with empathy

One of our management professors, Cameron Anderson, did research on “selfish jerks.” He tracked people all the way from college and looked at how they succeeded in their careers. And he found that being selfishly competitive doesn’t get you ahead faster. He also found that these characteristics can really hurt your organization.

So confidence without attitude is critical for today’s leaders. More than ever, it’s important to be a great listener and not think that you know all the answers.

On the importance of data analysis in business leadership

We’re in the midst of another major Industrial Revolution. It was happening before the pandemic, but the pandemic really accelerated the digital transformation. We see it in the markets, which increasingly are dominated by players that really understand how to harness the power of data and how to harness the power of technology.

We are weaving that into our curriculum’s core requirements. We’ve added requirements on mastering and strategically using data tools, like AI and machine learning. Students are learning everything from how to program to how to use and present big data. They’re also learning the ethics and pitfalls of machine learning and AI, where discrimination can be built into algorithms without your even realizing it.

On how we can change the education model to produce more modern leaders

Investing in K–12 in ways that are successful would be one approach. Right now, we see a bifurcation. Increasingly, those who can afford it send their children to private institutions, which negatively affects the public ones. 

Another thing we can do without changing the whole system is to have early-intervention programs. Businesses can do this. At Haas, we have our own: a program called “Boost.” Boost goes to local junior highs and finds candidates in disadvantaged areas who would really benefit from early help. The kids who sign up stay with the program all through high school.

Some of the help is academic, some is mentoring, and some is preparing for college. And the kids are incredible—they get into all the best universities and do amazingly well. It’s local, and it’s not huge, but it helps develop the pipeline. It’s all about the pipelines.

Read the full Q&A from McKinsey & Company

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Could recent tech layoffs prompt talk of unionization?

The labour movement in tech has yet to fully break through. Is change on the horizon?

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The old joke has it that when Google employees are laid off, they would just do a Google search for a new job. That conversation may have shifted in recent months. Now, tech workers who are laid off — or who fear being laid off — might be firing up a search on unions.

Indeed, while there’s been a recent raft of layoffs in the tech sector, there has also been, in the past year, an increase of 200,000 union members, amongst the 16 million members in the US. 

Taking a quick step back, the numbers were much higher in generations past. According to Rabble.ca, about 10% of the American workforce is in a union, contrasting to double that amount four decades ago. Almost 30% of the Canadian workforce is in a union, compared to nearly 40% in 1981.

Setting the stage?

Layoffs to the degree we’ve been seeing often prompt unionization talk, and this was no exception.

AFL-CIO President Liz Shuler said in an interview with Bloomberg that workers see an injustice: they don’t see an improvement in working conditions, as their corporations net billions of dollars of profit. In expectation that automation might replace workers, she foresees union contracts that prohibit this.

“That will continue to be a driver for people to say, ‘hey, do we have to sit back and take it, or can we do something about it?’”

In June 2022, workers in a suburban Baltimore Apple store were the first to successfully vote to form a union at one of the tech giant’s stores — a move the company appears to have embraced. Key issues included pay, working conditions, and having a voice at work, said an Apple spokeswoman. This fight came amongst other wider efforts of store workers at Amazon and Microsoft. A second Apple store, this time in Oklahoma, voted to form a union in October.

The Baltimore union reached another milestone in January 2023, entering into collective bargaining with management for the first time. 

Meanwhile, Amazon, as of January 2023 lost its fight to overturn its first union, voted on by workers in July 2022. In contrast, Microsoft accepted the results of its first union, with the 300-some workers at ZeniMax Studios.

“Microsoft has lived up to its commitment to its workers and let them decide for themselves whether they want a union,” CWA president Chris Shelton said in a statement. “Other video game and tech giants have made a conscious choice to attack, undermine, and demoralize their own employees…”

For many in the lay-off wave, though, it might be too late. It could take more than 450 days, on average, from the time a union is formed, to ratify its first contract, according to Bloomberg Law.

“Layoffs are shaking the tech industry,” said Clarissa Redwine, Senior Design and Tech Outreach Lead at Kickstarter from Jan. 2016 to August 2019. She said that management fired a third of her organizing committee in the same week — and she was one of them. “The team had 15 years of tenure and were all high performers,” she said.

She was then invited to the Organizing Committee of Kickstarter United just before they took the campaign public. 

Kickstarter United was the first wall-to-wall union in modern tech, Redwine said, and recently penned a contract that secured many rights unprecedented in the tech industry, such as guaranteed minimum 3% annual cost of living raises for all employees, a profit sharing bonus pool, salary benchmarking based on a national average, and ‘just cause’ provisions.

Kickstarter United and Tech 1010 from OPEIU held information sessions to discuss how to protect their workers. Redwine added that other workers in the tech labor movement began creating resources that directed tech workers to provisions like the WARN act (Worker Adjustment and Retraining Notification) that “might shield them from severe and malicious layoff tactics.” Twitter workers, she noted, crafted a Layoff Guide that went viral in worker Signal groups. 

“To challenge layoffs, workers must have the existing capacity to mobilize, and the tech labor movement is still young,” she added. “Only a handful of unions have won elections, and most unions in tech are still underground building quiet power. We have not yet seen a strike to effectively reverse these needless layoffs.”. 

“The mass layoffs are encouraging a surge of interest in unions… leadership uses this glut of labour and ‘competition’ to drive down the cost of labor in tech.”

Interestingly, a Harvard Business Review study from May-June 2018 showed that of twenty companies that let go of workers, presumably as a cost-saving measure, profitability actually declined in some instances, for up to three years.

In the wake of so many job losses across the tech sector in such a short period of time, it may very well come to pass that unions, learning from the fallout, will mobilize in greater numbers, preparing for the next round of mass layoffs coming down the pipe.

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