Deepwater Drilling: Driven by Culture?
Deepwater drilling is a high-risk operation. It involves going below water depths of 500 ft to explore for oil and gas. If there are any issues with the subsurface equipment, divers cannot intervene because human beings are physically incapable of tolerating such depths. But water pressure is not the only thing a person working in deep water needs to worry about. There will also be significant challenges to maintaining a work/life balance. The extent of these challenges could depend on one’s culture and roots.
What, then, is culture? Culture is based on the cumulated beliefs and behaviors characteristic of a particular group. Such a group could be as small as a family or as large as a country. Geert Hofstede, a Dutch sociologist, conducted extensive surveys of employees of different nationalities working for multinational companies and published his findings in a book in 1980. He identified the following five key dimensions of culture:
- Uncertainty avoidance
- Power distance
- Long-term orientation
He developed an index for each of these dimensions. Let’s see how deepwater operations rank according to these indices.
Uncertainty Avoidance Index (UAI)
The UAI is a measure of how comfortable a culture is in dealing with uncertainty. Are the people in a society comfortable with unstructured, unpredictable, or ambiguous situations? Are they flexible? Are they tolerant of change? If people are flexible, they listen to their inner voice and base decisions on hunches, gut feelings, or instinct. If they are not tolerant of change, they try to control the future and minimize uncertainty by planning and implementing rules, regulations, and standard operating procedures.
Cultures with high UAIs would have low tolerance for something like the deepwater business because of the great technical and financial risks involved. This has a great influence on the level of preparation oil and gas companies pursuing deepwater prospects would need for entry into a new country and their ability to successfully recruit people from the local country for high-risk jobs. Of course, in countries whose culture encourages adventure or risk-taking, there would be few or no roadblocks.
Power Distance Index (PDI)
The PDI is a measure of how distant a relationship a superior likes to have with their subordinates, and vice versa. In low-PDI cultures, everyone expects to be listened to regardless of status, rank, or background. People do not blindly obey the orders of their superiors. Leaders perceived as autocratic or patronizing are shown the door. Decision-making is not a top-down process. But, if the PDI is high, people “know their place.” They show off their status or class through dress and behavior. Superiors talk down to subordinates and make decisions for them without consulting them. In some families, parents decide for their children with little consideration for the children’s wishes and true debate rarely happens.
Malcolm Gladwell, in his book Outliers: The Story of Success, referred to the PDI. He talked about a correlation between cultures with a high PDI and plane crashes. He referred to the analysis of black-box recordings of crashes pertaining to two accident-prone airlines, one based in Korea, the other in Colombia. He argued that a power difference in the cockpit between the pilot and the copilot resulted in a fatal communication gap. The copilot didn’t want to embarrass his pilot when the latter committed errors. In one case, instead of directly saying, “The weather is really bad, we should turn back immediately,” the copilot said, “Sir, look how it is raining outside.”
Similar situations can arise on a deepwater drilling rig: Someone sees something hazardous but is afraid to report it to the supervisor because of deferral or fear of retribution. Deepwater winners are those who not only dare to apply new technology but also communicate in a precise way and pay attention to important details. Effective, unbiased communication is key to mitigating risks associated with deepwater operations.
The masculinity dimension represents a preference for domination in a culture. Are people always trying to be the best or the first? Are people very materialistic or very caring? Is the society driven by superiority or cooperation? In a culture with a high MAS, people are willing to accept high job stress to win (i.e., to achieve success and acquire wealth). Gender roles are clearly differentiated. The dominant values in a low-MAS culture would be relationships and quality of life. People will care more outwardly for each other. Also, in such a culture, men and women have the same values.
In the competition for a million barrels of oil and gas lying under deep water, oil and gas companies need people with expertise and willingness to do the job. Cultural parameters such as low MAS may stand in the way of success.
This is a measure of whether a culture is individualistic or group-oriented. In a highly individualistic culture, one is essentially concerned about the interest of oneself. On the other hand, in a group-oriented or collectivistic culture, the larger interests of a group far outweigh the narrow interests of an individual. The society is cohesive.
Deepwater drilling operations may put a premium on talent and individual thinking. However, people with different skills must work closely together as a team to deliver safely and successfully on promises.
Long-Term Orientation (LTO)
LTO is a measure of the time-horizon a culture has—short term or long term. If the culture is short-term oriented, it will be concerned with things in the near future. Memories are short. Patience wears thin. Quarter-end results are far more significant than the ones achieved over a 5-year period. However, a long-term oriented culture has a vision for the further future.
Success in deepwater drilling is not like instant coffee. It requires lots of patience and perseverance. Cultures with a high LTO index value are well positioned to undertake the rigorous tasks involved in deepwater operations.
One Size Does Not Fit All
Of course, one cannot make sweeping generalizations. All individuals sharing a given culture are not the same. Just because a culture is shared, all members won’t have identical values. There are always a few nonconformists in every culture.
Nevertheless, deepwater operations are high-risk, high-return endeavors; it takes a very dedicated and talented group of people to make these operations run smoothly and successfully. For the good of the oil and gas industry, let’s hope many more people from all cultures develop all the skills to pursue offshore work!
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26 May 2020