What attracted you to the service sector of our industry?
When I spoke to our 200-plus interns [this summer], I explained to them that when I was in their shoes I followed what my gut was telling me, which was to pursue a service company career versus an E&P [exploration and production] career. I was comfortable in what I sensed to be a more commercially intensive environment [in a service company] versus a long-term engineering environment [in an E&P company]. A lot of logic can be presented to rationalize an E&P career. In fact, I believe 80% of my colleagues began their careers with an E&P company. It is hard to say how things would have turned out otherwise, but I followed my gut and I am glad I made this decision. The key is to trust your instincts and avoid over-intellectualizing the decision.
Thinking back to when you started working in the oil and gas industry, can you think of specific decisions and/or relationships that had a lasting impact in your career?
When I was a student [at Pennsylvania State University] and over the course of the first few years of my career, maintaining relationships to the degree of publishing technical papers with my professors gave me the confidence I needed in an otherwise intimidating workforce environment. People can be overwhelmed when they are surrounded by experts with a great deal of experience and academic reputations. Having that conduit back to trusted professors while I was a junior engineer in the R&D [research and development] function at BJ Services made it a nice transition, a tieback to a world that was familiar to me as I entered a world I was not so familiar with.
I was also fortunate enough to form genuine relationships with my bosses early in my career. I found my first boss in this new environment to be of high integrity, and he was also very supportive and committed to my success. He created a learning environment that was very constructive. Had I been just one of many engineers and/or was in a hands-off culture, I don’t think I would have flourished in such a positive way.
What was the turning point in your career that led you down this leadership path?
The turning point was probably the first time I was exposed to the possibility of a senior role. It first became obvious to me when I was thrown into a turnaround operation in western Venezuela as a district manager. I really enjoyed getting the best out of people, particularly unrecognized talent. I was highly motivated to wipe out threats in direct conflict to our business with what I believed was best for the company. I felt like I was doing what needed to be done and that was very satisfying. I then identified local talent that wanted an opportunity to shine. The broader the base I had to do that with, the more satisfying it was going to become. That was an early indication that I enjoyed leadership roles.
What words of advice do you have for young professionals with visions of an executive career path?
I think it is really important that all employees believe that a role in leadership is possible. If you don’t think it’s possible, no one else will think it’s possible for you. Nothing is ever likely or obvious, and sometimes the stars won’t align in an obvious way. At the same time, leadership isn’t for everyone, and nobody should feel like that’s a requirement. Imagine if an engineering company like ours had employees that all wanted to be in charge.
It’s very important that people follow their passions, their hearts, and their expertise, not what other people think they should do. For every supporter and mentor you have, there will be just as many people that will try to talk you out of an executive leadership career as they point to the perceived risks, stress, and sacrifices associated with the job.
What are the characteristics one needs to have to make it to this level? What makes someone a CEO?
If anyone knew the exact answers to that question, they could write a bestseller book! Unfortunately there is no formula that works for everyone as there are many types of leaders.
To me, authenticity is critically important. As a CEO, you may not be like your predecessor and that is okay—you just need to be authentic. You also need to care about people, because that’s what it’s really all about. You need to have an unusual level of tenacity and persistence because you’re constantly dealing with obstacles. You also have to have a thick skin, because you’re being tested all the time by everyone.
Lastly and perhaps rather provocatively said, you need a certain degree of selfishness. You must place your career at a level of importance that affects other facets of your life. You must be prepared to sacrifice more than most. There’s no such thing as a “work/life balance” in my role. At the end of the day, you’ll have less dance recitals and birthdays; if you’re not prepared to make those sacrifices, then you should not have the aspiration to become the CEO of a large company. I chose to go this way, and although I do not regret it—because regret means you would do it differently if you could do it over—there is some kind of remorse out of the realization of how complicated life is. From my interaction with other CEOs, I know they have similar reflections. But for me and most of my CEO acquaintances, we’d do it all over again.
How would you characterize the role of service companies like Baker Hughes in the industry?
This may be a bit provocative, but in my opinion the world’s energy issues will be solved by the three biggest service companies. Without the service companies, it would be very difficult to discover and monetize unconventionals. George Mitchell will go down in history as a Henry Ford-type of legend in our industry along with Larry Nichols for recognizing the further potential and taking it to the next level, but he needed a service company to accomplish what he did. Opportunities like what operators are doing in the lower tertiary of the deepwater Gulf of Mexico, Nicaragua, and the eastern Mediterranean can’t be identified and can’t be monetized without the technology and innovation from the leading oilfield services sector.
My message to young professionals: If you want to be a part of solving the world’s energy issues, and if you want to make a difference and contribute, then sign up with one of the Big Three…preferably Baker Hughes.
The role of service companies has also changed with the emergence of national oil companies, who are now more than ever vocal on their technological requirements. Led by Saudi Aramco, Petrobras, and CNOOC [China National Offshore Oil Corporation], their rise in our industry includes international ambitions. The role of service companies is critical to their continued emergence, so from our perspective they have impacted our industry in a very positive way.
How does Baker Hughes position itself to stay competitive?
We see tremendous opportunities for Baker Hughes by investing in the right technologies and the right geographies to leverage the unconventional and deepwater resource development that will meet the world’s growing demand for energy. Giant ultradeepwater fields will present the greatest challenges our industry has ever encountered. To make these new frontiers safe and profitable, we are bringing together dedicated cross-disciplinary teams of experts in key locations, such as our Center for Technology Innovation in Houston, to collaborate with our clients in developing enabling technologies and integrated solutions.
On the other side of the world, we have the Baker Hughes Dhahran Research and Technology Center in Saudi Arabia, where we’ve established an integrated, multidisciplinary approach to understanding and developing unconventional oil and gas reservoirs. We’ve made massive technological advances in unconventional resources that are completely redefining the baseline. For example, we’re incorporating nanotechnology into drill bits, wireline systems, fracturing, flow assurance, and water management.
There is another, very important, way that we position ourselves to stay competitive, and that is by recruiting, developing, and retaining diverse new talent. For example, in 2012, 24% of our recent graduates in engineering, science, and technology positions were women. And, 20% of our employees in leadership and management positions are diverse.
What do you consider to be the technology of the future?
There is going to be a fundamental change in material sciences that I believe is already beginning to emerge, and I think nanotechnology will be at the center of the evolution. Fortunately for us, a lot of the brain trust in nanotechnology is close to us here within the Houston academic community, where we work with Rice University. I think we’re in a very fortuitous situation where we can download their knowledge.
How is Baker Hughes addressing the Big Crew Change?
We do suffer somewhat from the bimodal distribution in our industry’s age demographics to a degree, but the real challenge is the footprint that we’re expected to cover. On the other hand, the advantage we have is that this footprint allows us to dip into talent pools in geographic areas where this bimodal distribution isn’t as severe or present at all.
That said, I don’t subscribe at all to the Big Crew Change. I think the world has changed and people aren’t retiring at 65 anymore for a variety of reasons. Work is more interesting and safer than it has ever been. People are healthier than ever. I believe 65 is the former 55, so now people will retire at 75. We as company leaders have to adapt by changing our work environments, health care benefits, and networking infrastructure. We have to provide an environment where these professionals can be trained to fill mentoring and coaching roles.
The whole society is changing, and successful companies will recognize it as a commercial opportunity to gain talent. Talent is the most valuable asset in our industry, and if I can build a culture and infrastructure that makes this change in age demographics an opportunity that can be monetized and used as a competitive weapon, I’ll have done my job.
What does Baker Hughes do to retain talent?
As an organization, we must have empathy. We need to understand what’s important to people, how Baker Hughes falls into their world, and how we can make their world and their priorities more relevant so they can be successful. Sticking to the personnel manual printed back in the 1970s will not work today. We have to have a bias to action and be open to change.
I also think we have to be cognizant that young professionals today may be focused on their individual brands, and in today’s market they can take those brands anywhere they want.
When I grew up, a big part of me was the company I worked for, but today many folks are more about their brand, which is multifaceted. Their employer is only a part of the equation. Therefore, we have to understand how they are going to fuel their brand so we can identify and keep the best brands that are out there.From an entry-level perspective, we make sure we have rigor with intensity and dignity. You don’t have to have a cut-throat environment.
People in today’s younger generations expect more from leadership than an adversarial environment. They’re not looking for softness; they expect to constantly be challenged, and they want to win, but they also expect leadership to have many dimensions to it where they can be successful through team environments.
What career opportunities exist for young professionals in the service company realm?
People are given a larger level of responsibility in the service sector than in the E&P sector at a younger age. When the Big Three toe up against virtually any oil company, young professionals see increased levels of responsibility earlier in their career, ranging the gamut from budgetary, personnel, geographical, and/or innovation/technology responsibilities.
I also believe there’s a greater degree of geographical opportunities for young leaders. If you tell us that you want to spend some time in, say, west Africa, we are much more open to that at a younger age in your career than an operator would be.
