Value proposition Featured

8:00pm EDT August 26, 2008

In Bruce Vincent’s business, finding oil and gas beneath the Earth’s surface can be hard. But finding the next wave of talented employees flying beneath the radar can be even harder.

The president of the $650 million Swift Energy Co. says human capital is the most important resource in his business today, but it’s a resource with notoriously cyclical availability, as difficult as crude oil to discover, refine and maintain.

“The industry has age gaps in it, and some of that relates to the cycles the industry has gone through,” Vincent says. “If you go back to the ’60s, the industry wasn’t doing particularly well, and we didn’t have a lot of people going to engineering and geology schools to come into the oil and gas industry. But 1973 is when the embargo came and you had a significant influx of people.

“But when you moved into the mid-’80s and into the ’90s, the industry went through a long down cycle, you saw school attendance decline, and some schools even shut down. So the industry has an age gap particularly from the mid-30s to mid-40s. But we’re now getting an influx of young people in the business again.”

With large age gaps in the oil and gas business, it can be difficult to build and sustain a successful company culture. In order to rally everyone around a single set of objectives and core values, Vincent needs to not only overcome the natural gaps that exist between different locations, disciplines and departments but overcome age gaps, as well.

Vincent says getting the right talent in the door and in the right positions is a critical first step. But if you can’t get those talented employees aimed in the same direction and following the same set of values, it will make the task of moving your company ahead much more difficult.

Start with a vision

The first step toward a unified team is having a clear vision. The leaders at Swift have seven core values around which they try to focus the entire company: stewardship, continuous improvement, high performance, integrity, passion, trust and teamwork.

Those qualities are valued by just about every company, but you can’t assume that your employees are going to reflexively embrace those values — or any values you emphasize — from the first day they set foot in the office.

Vincent says you have to treat your vision for your company’s future as the foundation, then build on top of it.

“You really start with your vision,” he says. “You have to create a vision that people can see and understand. It has to be kind of short, sweet and to the point, but allows them to envision what the future is going to be like at the company. Then, you have to establish a mission statement that articulates where you are going, how you are going to get there, what are the key components of the mission. Beyond that, you have to establish a culture within the organization that really cements a set of values within the culture and how people work together.”

Defining the vision, mission and values begins as a top-down process that requires consistent communication from management. However, at Swift Energy, Vincent says his method isn’t to simply give orders from the top, it’s to involve employees in shaping the future of the company.

“As you establish the mission and the vision, you don’t just dictate it, you involve people in the process so that they understand what the values are, they believe in the values, but more importantly, they are part of identifying the behaviors we want to have practiced in that environment.”

In an effort to get employees interested and involved in shaping and refining the vision and mission, Vincent and other leaders at Swift Energy communicate with them in multiple ways. Casting the widest possible communication net allows you to appeal to the widest possible audience.

“Management has to take the first cut at it, but ultimately, you need to involve everybody, and you do that through large company meetings, smaller group workshops, digital communication, e-mail and the like as you get feedback from people,” Vincent says.

But the communication doesn’t stop at the conference table or computer terminal. Once the mission, vision and core values are out there, they need constant maintenance from management.

Create an emotional bond

Vincent frequently says he wants his employees to “live and breathe” the Swift Energy culture, and they won’t do that if management doesn’t set the example.

Every time you interact with peers and subordinates, it’s an opportunity to build up or break down your culture.

“Living and breathing a culture really means that in all your interactions with your peers you’re practicing these values,” he says. “Leadership can establish values in a company, but you can’t enforce that. How you make that work is not through an enforcement mechanism, but it’s living and breathing it.

“For example, if trust is important to you as a core value, you’re always telling the truth and making sure that your behavior reflects your words. The thing I always tell people is to go with the behavior, not the words, because people can say lots of things but their behavior tells you what they’re really thinking. You want to promote transparency.

“Another part of it is calling each other out when we’re not practicing those values. I’ve made it clear to people that if I’m not practicing our core values, you tell me and let me know. If I’m not practicing the values and they didn’t call me out, I’d quite frankly be disappointed in them.”

Enabling employees to take charge of their part of the company is an element in creating what Vincent calls “emotional ownership.” He says it’s a form of ownership that is entirely separate from monetary ownership and, in some ways, more important to the long-term health of your company.

“Ownership is a hard thing to do, but if you have ownership from the heart and not from the wallet, you’re going to have a higher-performing company,” Vincent says. “Every single one of our employees is a shareholder, so we think that’s important. But creating emotional ownership is the greater challenge, and you have to do that through the culture of the company.

“It would be easy to start a company, hire the people and give them all equity so that they’re all shareholders. But they wouldn’t, at least in the beginning, feel like they’re real owners of the company. It takes time to cement that (emotional ownership) in place so that people are living it and breathing it. But you need constant reinforcement. It has to be clearly practiced from the top down, and you have to communicate it all the time so that people believe it’s real.”

Measure your progress

Swift Energy performs an annual cultural survey aimed at measuring how effectively employees are internalizing and passing along the company culture. Over time, trends develop, and Vincent is able to see both areas of success and areas in which improvement is needed with regard to bringing employees on board with the vision, mission and core values.

“The survey is designed to get feedback from our employees on what kind of an organization we are,” he says. “Over time, you see trends develop. One of the things I’ve always been particularly proud of is that one of the things that gets rated at or near the top every year is the values of the company. The other thing that gets rated at or near the top is safety. So two of the things we talk about, that we believe are important, you are seeing evidenced in feedback from employees.”

But feedback can’t stop with an annual survey, no matter how enlightening it is. Vincent also emphasizes taking the pulse of the culture through day-to-day interaction with employees.

“Day to day, there is not a formal process, and I don’t think you want a formal process,” he says. “The process is more informal in the sense that we rely on each other to hold each other accountable for our values.”

Setting the standard for accountability starts with senior management. Vincent says you and your direct reports need to show the rest of the company that you are willing to work as a team to promote the values of the company.

“We expect people to perform as a team every day,” he says. “We have to constantly make that an important issue for us — something we practice at the top. You can’t have divisiveness in the highest ranks of the company without expecting that divisiveness to be rampant throughout the organization. If your senior-level leadership is working as a team, if they’re transparent and open to each other, if they’re not building silos or fiefdoms, that is going to ripple through the organization.”

Focus on the big picture

Vincent says every business leader should have one overarching goal when it comes to building a culture and core values: If you left your company tomorrow, it would stay on the course you set.

Human nature is often slanted toward small-picture thinking. People are concerned with the job on the desk in front of them, how their direct bosses are treating them and how their direct reports are performing. But in order to have a big-picture company, you need to have people who realize that a company and its culture are greater than the sum of their parts.

“None of us are so important that the company couldn’t go on without us if we left one day,” Vincent says. “That’s why you have to cement it in everybody’s minds and hearts, this idea of a company being greater than the sum of the parts. Once that is solidified, then whoever is at the top could leave tomorrow for whatever reason, and the people in the company are going to continue to live those values because it became a part of them.”

You must eradicate small-picture arguments before they can escalate. Vincent says disagreements largely develop within a company because someone isn’t practicing the company’s values. When that happens, there are usually only two potential solutions.

“That’s one of the challenges leadership has in any organization, you have personality conflicts or legitimate different points of view,” he says. “We see that played out every day in politics. Ultimately, it comes down to living the values that you’re talking about, because when you get into those disputes, it often results from someone not practicing those values. You have to get in the middle of it and get them to work together, or sometimes, someone has to go.

“Our attitude at Swift is, we’re not going to tell you that you have to live these values. But we’re going to tell you that if you don’t want to live these values, you should probably find another place to work. That doesn’t mean that you go fire somebody, but you make it clear that if you’re going to work here, we expect you to live these values.

“You want people to know that if we all share this vision, this mission and we all live these values, we will be a much higher-performing company, and that’s what we’re trying to accomplish.”

HOW TO REACH: Swift Energy, www.swiftenergy.com