Guest Editorial: How To Thrive in a Downturn
- J. Roger Hite (Inwood Solutions) | C. Susan Howes (Consultant)
- Document ID
- Society of Petroleum Engineers
- Journal of Petroleum Technology
- Publication Date
- March 2016
- Document Type
- Journal Paper
- 14 - 16
- 2016. Copyright is retained by the author. This document is distributed by SPE with the permission of the author. Contact the author for permission to use material from this document.
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The industry is in one of its periodic downturns. Jobs are uncertain or scarce. Profitability is challenged. Bankruptcy looms. Projects are being canceled. Deals are dropped or delayed. It seems there is bad news everywhere. So how do we survive in this environment? And, more importantly, how do we go from surviving to thriving?
The leadership of the SPE Gulf Coast Section (GCS) has launched a new initiative called “Members in Transition” with the aim of providing support, advice, and best practices for thriving in a downturn. The key principles are the following:
1. Be innovative. Plan A is often not available these days. We have to look for alternatives. As an individual, whether you are a prospective graduate with an ambition to work for a major producer or a service provider, or have just lost your job, consider all alternatives.
- In addition to your first choices, also look for jobs in marketing, finance, regulation, midstream, or downstream. Your expertise is in the petroleum industry, as well as in petroleum engineering. Your skills are much broader than you might think.
- Extend your education by taking advanced courses or by earning a new degree. This will be time well spent preparing for the future. Explore the educational opportunities available from your SPE section.
- Start your own business. This could create a rewarding new career path. In partnership with the Houston Technology Center, the SPE GCS is establishing an Ideas Launch Pad program to match members’ ideas with angel investors. Entrepreneurs will need realistic financial projections and need to be able to tell the business story in a convincing way to potential investors. Employers value entrepreneurial skills. These business skills will serve you well if you eventually decide to move to a corporate role. Creating a great business story (Fisher 2014) for investors will help you develop skills that are useful for moving projects forward when you are hired by a company in the future.
As a company, your previous business plan may no longer be viable in the current price environment. Take a clean sheet of paper, throw out all past preferences and prejudices, and start afresh. Develop a new plan that works in today’s environment.
Now is the time to explore new technologies and new processes that improve performance. In the January issue of JPT (Rassenfoss 2016), the SPE technical directors talked about innovations needed for “Doing Better in Bad Times.”
2. Be curious. To come up with new ways of doing things, you need new ideas. To get new ideas you need imagination. This is a good time to look for ideas from other industries.3. Cut costs. When prices are low, it is important to cut costs, whether you are an individual or a company. Now is the time to be diligent, even ruthless, with cutting costs. In the end, you will be more secure and better prepared when good times return.
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