Doing the Right Thing

The ability to attract and retain top people is a critical challenge facing the oil and gas industry. As an asset-based business, employees are a small part of the costs but a big part of success. That’s why a new book by James Parker, the former CEO of Southwest Airlines, provides some good lessons for oil and gas leaders.

Parker’s book, Do the Right Thing: How Dedicated Customers Create Loyal Customers and Large Profits, advocates the simple credo “take care of your employees and everything else falls in place.” Southwest employs the same low cost strategy (cost leadership) that is the keystone of the oil and gas industry. In spite of this philosophy, Southwest often “scored better in customer service rankings than its bigger, higher-cost competitors.”

Parker says that the secret is dedicated, spirited and hard working employees. He says that “distributed leadership,” the concept of having leaders throughout the chain of command, provides initiative throughout the organization. Parker also emphasizes the importance of the team, which is a concept long-embraced by oil industry management.

I believe that establishing an environment where employees become dedicated, enthusiastic team players requires management to demonstrate the same qualities. Creating such a workplace will help assure that those top people will stay and contribute.

Not surprisingly, his book contrasts the styles of Southwest with rival American Airlines. In dealing with problems at American “the primary focus of communications was blaming and avoidance of blame – in contrast when something went wrong at Southwest, the focus of communications was problem-solving.” This is a critical issue in companies that want to encourage innovation and “point-of-service problem resolution.” Too often companies preach creativity, but practice CYA and DSU (don’t screw up).

Please visit Oil and Gas Library to order your copy of James Parker’s Do the Right Thing.

[Source: “Former Southwest CEO shares lessons in new book,” Terry Maxon, The Dallas Morning News, January 21, 2008]