Guest column

Sustaining a culture of innovation is key to driving the energy industry, says this Houston expert

While most corporations should be optimizing their company cultures, energy companies specifically need to move the needle on driving forward innovative culture for its employees. Getty Images

The prevailing economic environment has made innovation essential to gaining a competitive edge in the oil and gas industry.

Global economic shifts and the unstable oil market have been considerable factors inhibiting the advancement of innovation in the oil and gas sector. Oil prices have not significantly increased in the past four to five years, while investors and Wall Street hold corporate executives accountable for capital discipline.

In light of these trends, corporate culture and innovation are key factors that hold the potential to drive novelty in the next upcycle. To bring value to shareholders, the oil and gas industry needs to nurture an environment that fosters a radically innovative culture to create new product lines and markets, unique ecosystems, product content, and processes.

Culture from the top down

Organizational culture is one of the essential dynamics that drive innovation. Employee behavior helps influence and promote the acceptance of innovation as a fundamental corporate value. Organizations are therefore admonished to concentrate on fostering an innovative culture that allows the growth of new ideas.

This culture needs to be created by deliberate action on the part of leaders of industry or by indirect measures such as composition and institutional policy directions. A model of innovative culture which translates into cultural transformation emerges as a result of this deliberate action and institutional policy directions.

Various studies over the years have examined innovative culture models focused on cultural characteristics or factors. A comprehensive, innovative culture model that incorporates cultural traits and their determinants is reviewed in this contemplative piece.

Execution  culture vs. innovative culture

In her book, "The Culture Map: Breaking Through the Invisible Boundaries of Global Business," Erin Meyer explains that "ambidextrous culture" is the concurrent search of flexibility and alignment at a business unit/sector which is linked to several organizational outcomes including improved performance and innovation.

This ambidextrous culture can be divided into two broad categories: Execution culture and innovative culture. Execution culture is a working environment that is more process- and task-driven to get things done. The oil and gas industry has typically favored the execution culture, where there is a central decision-maker at the head of the table. Research and recommendations on pertinent matters are typically presented to decision-makers who sit through a PowerPoint presentation. Subsequently, a decision is made based on the facts presented via PowerPoint presentation.

One critical demerit of this setup is that it usually leans towards low-risk conservative judgment. The executive lifestyle has worked in the past in the oil and gas industry due to the high fixed cost, and the "failure is unacceptable" approach in the industry.

With new technologies such as 3D printing, predictive analytics, machine learning, and deep learning, one can test some ideas or thoughts through rapid prototyping in a lab setting to test their hypothesis. Therefore, this type of culture as a sole approach to decision-making in the industry may need to be reconsidered.

Meanwhile, innovative culture is a work environment where leaders encourage and nurture unorthodox thinking in approaching problem solutions and applications. If the energy industry leaned more toward this style of culture, it would help foster innovation and accelerate the innovation landscape in the industry.

Innovative culture is a more design-oriented approach that generates a large pool of options and also incorporates a visual thinking framework. It enhances a creative mode for the audience, and everybody in the company ends up being a decision-maker. This type of culture fosters open innovation, eliminates the fear of expression, and pushes for more collaboration and creativity in the ecosystem.

According to a recent survey done by Accenture Strategy, 76 percent of leaders say they regularly empower employees to be innovative, while only 42 percent of employees agree. This shows an apparent disparity in more than the perceptions of employers versus employees and the belief that innovative culture is not promoted by middle management. This barrier can be broken down by instituting and enforcing an innovative culture.

Staying agile in a transforming world

The world has changed, and it will continue to transform. Various factors are disrupting traditional methods of business management across the globe, and organizational behavior is being impacted significantly. For an organization to be competitive globally, it requires innovation and creativity.

The rate at which businesses are facing competition requires agility. Employees are pressured to give their best and to come up with new ideas at a level even beyond some of history's greatest minds. For many, uncertainty and insecurity abounds. The fear of being made redundant and a resulting lack of trust prevents creativity among employees.

Trust, productive gameplay, and fun — critical components of an innovative culture — can spark creativity and increase global competitiveness. Due to the recent downturn, most teams are burdened with the same amount of work, which was meant for double or tripled their workforce and are still expected to perform at their peak capability. They need the right conducive environment to function.

Implementing action

While the energy industry should avoid trying to copy innovative practices from technology companies, oil and gas companies should review possible case studies that can be incorporated in fostering an acceptable culture for millennials to be attracted to the industry.

Presentation is important

Take a look at your marketing materials, for instance. Skip the stereotypical image of the macho oil guy on a rig operating the brake handle and showcase how the industry is adapting open innovation across sectors such as using predictive analytics and rapid prototyping to help design a safe working environment. Showcasing the conducive culture we experience in oil and gas, which challenges us to think outside the box and solve the world's energy problems will be an excellent way to create opportunities internally in companies and also attract and retain talent from different backgrounds and industries to help solve the world's energy problems.

Consider flexible work initiatives

To help establish and foster an innovative culture in oil and gas, the industry needs to embrace virtual and remote working environments, retraining and refresher courses to keep employees' skills relevant to solving problems, leaders setting a positive example on work-life balance and cutting down or avoiding long-distance travel via virtual meetings. Others essential pointers to consider are, giving employees the freedom to be themselves at work, leadership or management having a positive attitude towards failure, allowing remote work on days on which employees have personal commitments, networking events with company leaders scheduled during office hours, having an open channel for the report of sexual discrimination/harassment incident(s) to the company, among others.


I'd like to close with a quote from another influential book, "The Innovator's Dilemma," by Harvard Professor Clay Christensen. He writes, "When an organization's capabilities reside primarily in its people, changing to address new problems is relatively simple. However, when the capabilities have come to live in processes and values and especially when they have become embedded in culture, change has become extraordinarily complicated."

Establishing a uniquely innovative culture within the energy industry will be a great foundation going forward, for spurring progress in the oil and gas sector.

------

Nii A. Nunoo is senior associate and management consultant within Strategy and Energy Core Operations at KPMG.

Trending News

Building Houston

 
 

Check out these conferences, pitch competitions, networking, and more in the month of October. Photo via Getty Images

Houston's busy business event season is in full swing, and there are ton of local innovation and entrepreneurship-focused programming across the city. Here's a rundown of what all to throw on your calendar for October when it comes to innovation-related events.

This article will be updated as more business and tech events are announced.

October 4 — Softeq Venture Studio Happy Hour

The Softeq Venture Studio is excited for you to meet the newest startups accepted into its 2H 2022 Cohort. Meet the teams and learn more about how they secured $125K in funding.

You'll have the chance to meet the startup founders, learn about the problems being solved, and learn more about how the Softeq Venture Studio de-risks growing startups.

The event is Tuesday, October 4, at 5 pm, at Yardhouse (City Centre). Click here to register.

October 5 — State of the Airports

Houston Airports is one of North America's largest and busiest multi-airport systems in the world and plays an important role in the greater Houston region's position as a great global city.

State of the Airports features Houston Airports Director, Mario Diaz, who will share the latest information and growth plans for Houston's three airports. Diaz will also address the important role the Houston Airports plays in bolstering Houston's position as an international air gateway.

The event is Wednesday, October 5, 10:30 am to 1:30 pm, at the Marriott Marquis. Click here to register.

October 11 — State of Space

Earlier this month, Space City celebrated the 60th anniversary of President John F. Kennedy’s proclamation delivered at Rice Stadium, "We choose to go to the moon." Many decades ago, these words showed the world that Houston holds a place as the epicenter for the world's biggest space endeavors and while space exploration has changed tremendously since those famous words, Houston's reputation in aviation and aerospace only grows stronger.

Join the Greater Houston Partnership for State of Space on Tuesday, October 11, to hear from some of the sharpest minds in aerospace and aviation technology who continue to chart a vibrant future for Houston centered around NASA's Johnson Space Center and one of the world’s only truly urban commercial spaceports.

Speakers include:

  • Featured speaker and panelist: Vanessa Wyche, Director, NASA’s Johnson Space Center
  • Stephen Altemus, President & CEO, Intuitive Machines
  • Peggy Guirges, General Manager of Space Systems, Collins Aerospace
  • Panel Moderator: Arturo Machuca, Director, Houston Spaceport and Ellington Airport

The event is Tuesday, October 11, 10:30 am to 1:30 pm, at Impact Hub Houston (1801 Main street 10th Floor). Click here to register.

October 12 —  Making an Impact in the Houston Tech Ecosystem

You may have heard that Jay Steinfeld was the founder and CEO of Global Custom Commerce, which operates the world’s top online window coverings retailer Blinds.com. Boot-strapped in 1996 for just $3,000 from his Bellaire garage, Global Custom Commerce was acquired by The Home Depot in 2014. Jay remained its CEO and later joined The Home Depot Online Leadership Team. After stepping away from these roles in early 2020, he has increased his involvement on numerous private company boards and serves as a director of the public company Masonite (NYSE: DOOR). He also teaches entrepreneurship at Rice University’s Jones Graduate School of Business and supports numerous charities. Jay is an Ernst & Young Entrepreneur of the Year and has earned a Lifetime Achievement Award from the Houston Technology Center. Active as an industry speaker on corporate culture, core values, how to scale a start-up, and disruption, he has more than 100 published articles.

But did you know that many of Jay’s former employees have started businesses of their own, formed angel investment funds, developed and led some of Houston’s best technology teams, and grown into pillars of the HouTech community?

Come hear what’s sure to be an intriguing panel discussion with Jay and several ex-Blinds.com’ers as they discuss company culture, core values, lessons learned, and thoughts on the HouTech ecosystem and take questions from the audience.

The event is Wednesday, October 12, at 6 pm, at the Ion. Click here to register.

October 13 — October Transitions on Tap

Transition On Tap is Greentown Labs' monthly networking event devoted to fostering conversations and connections among the climate and energy transition ecosystem in Houston and beyond. Entrepreneurs, investors, students, and friends of climatetech are invited to attend, meet colleagues, discuss solutions, and engage with our growing community. If you’re looking for a job in climatetech or energy, trying to expand your network, or perhaps thinking about starting your own energy-related company, this is the event for you.

The event is Thursday, October 13, 5 to 7 pm, at Greentown Houston. Click here to register.

October 14 — Tech, Tools and Tips: Digital Training Day at Impact Hub Houston

Struggling with a process in your business? There's probably a tech tool for that. Impact Hub Houston invites YOU to attend an extended edition of its Tech, Tools, and Tips Series hosted in partnership with Frost Bank.

The goal for this session is to provide small business owners with an overview of various digital tools that can help your day to day operations. By attending this event, you will learn about various digital tools and also have an opportunity to network with other small business owners.

The event is Friday, October 14, 8:30 am to 12:30 pm, at the Omni Riverway. Click here to register.

October 14-16 — Incubate Galveston + the Ion Hackathon 2022

A hackathon is a social design sprint that brings together the community to work in teams creating innovative solutions. Basically, it’s a party, and a 48-hour race between teams competing to develop solutions to problem-sets for cash prizes. Participants will work in small teams that have a collection of experts, entrepreneurs, students, and community members to tackle the below identified challenges:

  • Increase food access in urban core neighborhoods
  • Create opportunities for green initiatives, including environmental education, coastal resilience, and conservation
  • Propose home refurbishment programs and housing
  • Develop capacity for education and workforce skills development
  • Solve the plastic pollution issue in Galveston: Plastic trash in the water supply, on the beaches, and in the waterways of Galveston and surround areas affects the community in many ways (e.g., beaches look dirty, the plastic has chemicals harmful to health, and microplastics get into the environment and remain there for long periods of time. How can we solve this problem, removing and reducing waste and its downstream impacts, and make our community safer and cleaner? The plastic pollution problem can be address in the way of innovative preventive steps, innovation treatments, and public education, etc.
  • Offer creative solutions to other challenges

The event is Friday, October 14, to Sunday, October 16, at the Marmo Plaza. Click here to register.

October 19 — How to Build an App without Code, Part 1: Info Session (In-Person & Online)

Join Heather Wilson, a UX Researcher, Service Designer and Google Design Sprint Facilitator, as she teaches you how to build an app without code!

Benefits of building an app without code:

  • building a custom app could take months to a year to develop
  • coding could present problems when your mobile strategy is pivoting
  • allows for customization and the ability to make changes as needed
  • high costs can be associated with building am app
The event is Wednesday, October 19, at 6 pm, online. Click here to register.

October 20 — 2022-2023 UH Energy Symposium Series

Rising electricity prices, increasing concerns about grid reliability, and achieving carbon-free electricity in the U.S. by 2035 have refocused attention on the role of nuclear in the energy transition. This comes after a decade of low investments, accumulating nuclear waste, an aging fleet of reactors, public opposition, and regulatory mandates that stalled nuclear’s growth and led to declines in production. Meanwhile, the nuclear industry has maintained its safety record, made remarkable progress in fusion and advanced nuclear reactors, and improved operating safety and efficiency.

The first topic of the 2022-2023 Energy Symposium Series, The Future of Nuclear in the Energy Transition, will address if and how headways in advanced nuclear reactors, fusion, and waste management can overcome the challenges of economic feasibility, efficient and safe waste disposal, and build public and regulatory support for the increased deployment of nuclear energy in the U.S. We are excited to bring our panel discussion of Critical Issues in Energy back on campus this year.

The event is Thursday, October 20, at 6 pm, at Hilton University of Houston - Conrad N. Hilton Ballroom . Click here to register.

October 26-27 — Fuze

Fuze is bringing together the builders and innovators in energy tech. Shutting down 5 blocks in downtown Houston for two days and covering three content tracks, the event is focused on discovering breakthroughs in energy technology.

The event is Wednesday, October 26, to Thursday, October 27, at 8th Wonder Brewery. Click here to register.

October 27 — Aerospace Investment & Engagement

Join the Houston Angel Network as they discuss the current and future state of aerospace innovation and investment, followed by pitches.

The event is Thursday, October 27, at 8 am to 1 pm at the Ion. Click here to register.

October 27 — Space-Related Technology Development and the Houston Innovation Community

In these presentations, Mr. Montgomery Goforth and other aerospace subject matter experts will discuss the technology development challenges faced by NASA’s Johnson Space Center and the surrounding Aerospace community in our ongoing efforts as the hub of human spaceflight. Presentations will focus on the ways in which these challenges, and the associated opportunities, can be leveraged by Houston’s innovation community.

The event is Thursday, October 27, at 4 pm at the Ion. Click here to register.

Trending News