The oil and gas analytics market is expected to rise at a CAGR of 19.3% during 2016–2024, according to Transparency Market Research (TMR), with smart sensors and big data being used to manage risks, cut costs by increasing efficiency, and increase revenues.
There has also been a great deal of talk about how data will also drive automation in the the sector. Automation adds substantially to the upstream value chain of exploration, development, and production. Given the oil and gas industry’s substantial increases in upstream capital investment, optimizing production efficiency is essential. Automation also helps to maximize asset and well integrity, increasing field recovery, and improving oil throughput.
However, embracing data analytics does not completely remove the need for humans from decision making on oil fields. Creating a digital oilfield doesn’t just need algorithms. Companies must create a harmony between the two and use that harmony to their advantage, adjusting their recruitment policy and helping adapt the skills of those staff already in their roles, to develop a greater understanding of the data and how to use it.
Data can also help when it comes to managing people. Tesoro Corporation is a Fortune 100 and a Fortune Global 500 oil and gas company headquartered in San Antonio, Texas, with revenue in 2016 in excess of $1.8 billion. It has led the way in people analytics, and at the heart of this drive has been Robert Lanning, who heads up its People Analytics team. He has spent the past 30 years delivering proactive research, insights, and analytic solutions across the entire enterprise across multiple industries, using his leadership skills to develop fully engaged, developed, and focused teams that produce and are recognized as the best in their industry.
We sat down with him ahead of his presentation at the HR & Workforce Analytics Innovation Summit, which will take place this June 19-20 in San Francisco.
How did you get started in your career and what first sparked your interest in analytics?
Nearly 35 years ago, my first job was a library clerk, with my work primarily involving checking in and out materials, shelving returned materials and rudimentary assistance for customers in locating library resources and providing 'ready reference' assistance (e.g., 'Where can I find a book on X?'). This was before computers were introduced, so everything was manual, including statistics (we actually physically counted cards every night to determine how many materials were checked out). After a few weeks, I started to notice patterns in utilization of resources, attendance patterns, and, when I started doing overdue notices, I discovered patterns in types of materials that tended to be overdue. I started documenting these patterns and began having 'bets' with the senior staff against my forecast. Turns out I was dead-on target about 80% of the time. Once computers entered the building, I became the de facto expert in administering and assisting with all the new capabilities including spreadsheets (VisiCalc then Lotus 1-2-3) and databases (Condor III and dBase III/III+). Within a year, I had the 'joint jumpin' with automated processes, data collection, KPIs, and even some competitive benchmarks. That got me noticed by the head of the Air Force Services Agency’s Library Division, who hired me to be their analytical 'wunderkind' – and the rest, they say, is history.
Do you feel HR is behind other departments when it comes to implementing data initiatives? If so, why do you feel this is the case and what can HR leaders do to rectify the situation?
HR tends to be behind other departments, stereotypically. In organizations without a dedicated Analytics/Inisghts/Research function, you’ll typically find a resource or two with HRIS who helps with reporting (primarily compliance related or general interest – how many X employees do we have) or a good analytical expert within an HR sub-function (e.g., compensation, payroll, or org design). HR leaders, whether 'data savvy' or not, needs to get a vision of what HR analytics/insights/research can accomplish within their organization and then staff the function appropriately, with someone who has the vision as well (and not just the best Excel jockey in HR).
How important is it to introduce a data-driven culture across the organization? How is it best achieved?
Huge. Without a data-driven culture, you are throwing money away and wasting your team’s time.
A data-driven culture is best achieved by partnering with the HR CoEs and HR Leadership (including the HR Business Partners) in the design/development and deployment of the analytics/insights/research function (including tools and policies). Having regular meetings with everyone and training on latest developments, new tools, and new ways to use existing tools are easy ways to begin to change the culture. Having one-on-one training and 'lunch-n-learn' sessions are helpful as well. Also, new hires coming into HR should have 'data-driven culture' assessed during interviews. I’ve even seen HR analytics pros who are part of the interview process for every new hire in HR, regardless of position.
I’ve experienced a culture change – over 3 years from 20% data savvy-ness to 80% data savvy-ness – following the suggestions I’ve just provided – it works, but it can’t be driven just by the HR analytics team – it needs the 'real' support of HR leadership.
What do you see as the most important metrics to look at to gauge employee satisfaction?
Regularly scheduled ('pulse' is the buzzword right now) surveys that are brief and painless. Questions have to be customized to each organization (for some, it could be the 'recommend [Company] as a place to work'; while for others it might be something more specific to empowerment).
Absent these regularly scheduled surveys, I’d use attrition rates and then sentiments and comments derived from exit interviews.
What technologies do you see as having an impact in the analytics space in the near future? Wearable devices are an obvious way to collect data on employees, do you think we will see them being used more in the future? Should they be?
This depends on the organization as a whole. I can see the potential uses for analytics from wearable technology, but I can also see the potential misuse. So, I do see use of analytics from this data increasing (particularly analytics around employee health/fitness), but widespread use will be dictated on an industry-by-industry basis.
You can hear more from Robert, along with other leading experts in the field from the likes of Facebook, Airbnb, and Chevron, at the HR & Workforce Analytics Innovation Summit. View the full agenda here.
BONUS CONTENT: Brian Fruchey, Manager of Analytics at Facebook gives an overview of Facebook's approach to workforce analytics, how data is used in hiring and training of staff, and employee engagement