Nuts and Bolts
This year, I’m devoting Both True to exploring the two essential ingredients for energy leadership today:
1. a vision for the energy future that engages and compels your (often skeptical) stakeholders, and
2. executing the nuts and bolts of that vision—the ways your company will execute the difficult details of running a base business while also launching and building real sustainability ventures.
Today we look at one of the pillars of Number 2: the importance of building a can-do attitude about real sustainability into your company’s culture—especially in a world where so many would like to see you fail.
Both of these things are true:
- Oil and gas company employees overwhelmingly have a can-do spirit for technological and market challenges, fueled by their innovation experience and engineering expertise.
- The myriad technical challenges of executing the energy transition in oil and gas companies—paired with a public often hostile to the idea that such companies can have anything to do with that transition—can push even the most optimistic teams into despair.
Executing amid the “daunting vastness”
It was Robin Fielder of Talos Energy who first described this tension for me. (Check out our podcast episode here.) As Robin told me, groups in charge of new ventures were once the hot ticket within oil and gas companies. Now, a couple of years in, they are charged with executing the seeming impossible: navigating new technical challenges, hostile stakeholders, difficult permitting, new business models, and unknown margins. I’ve come to characterize this endless range of execution the “daunting vastness.” Among our clients I often hear the refrain “Why are we doing this, again?” (joking/not joking).
As a result, new-ventures leaders are tasked with acknowledging this tension and actively cultivating a culture that willingly tackles these challenges head on. How can you do this effectively? Here’s the top advice I’ve learned from dozens of leaders I’ve talked with and surveyed:
1. Pick your lane. Each new-ventures team needs to clearly articulate what’s in and what’s out in its endeavors. This is the primary way to narrow down the “daunting vastness” that Robin described. The process keeps the team focused on an acceptable number of risks and limits the world of opportunities. It allows the team to learn, iterate, and improve on its efforts as well.
2. Avoid common mistakes. Our team at Adamantine continues to be approached by companies that think that communities will of course welcome their projects. These companies are almost always in for a rude awakening. Such assumptions can kill a project before it starts. So don’t expect liberal-leaning communities to welcome a green energy or DOE-backed project. Don’t expect your traditional oil and gas community to automatically embrace a geothermal or CCS project, either. Political polarization combined with increasingly powerful NIMBYism means that you must engage all communities that are stakeholders for a project as your partners, ASAP.
3. Set expectations with your leadership. The best inoculation against the challenges of new ventures is to foreshadow these challenges with your investors, leaders, and board. These projects will shape up slowly. Margins will be different. Stakeholders will be skeptical or even hostile. Companies can and do handle these challenges when they are baked into the planning process.
4. Curate the can-do. I’ve found it to be a light lift to narrate the important role that oil and gas companies will play in decarbonization projects. Who is better positioned than we are? No one! As an industry, we have demonstrated the ability to innovate and execute energy projects at scale. We have been evolving for 150 years and are well positioned to continue to do so. Start-ups don’t have the resources, scale, or permitting know-how—never mind the ability to build the massive projects required. If not us, who? In this case, the daunting vastness plays to our strengths.
My Energy Thinks podcast will be back for a new season next week with an amazing lineup of industry leaders who can talk about the two essential elements for energy leadership now.
I was recently a guest on the My Climate Journey podcast—check it out here.
To opportunistic vastness,
Tisha
