This is a periodic newsletter from OpenWater Energy Ltd where we discuss and and analyse key developments related to the Offshore Energy Transition. We trust that you find this interesting, and any feedback is welcome – please send to info@openwaterenergy.com
Introduction
A transferable skill is usually defined as “an ability or expertise which may be used in a variety of roles or occupations”. Typically this refers to personal skills such as problem-solving, clear communication or leadership ability. These skills are considered when assessing recruitment candidates, in order to ensure that as well as the relevant technical skills the candidate should have the ability to undertake a range of potential future roles.
OpenWater Energy Ltd (OWEL) believes that a similar approach can be used when considering the ability of a complete organisation to transition into a new market area. By mapping the company’s existing skills and comparing these against the skills needed to succeed in the new market, a solid business strategy can be built.
This article describes the process developed by OWEL called Corporate Transferable Skills Mapping (cTSM). We have specifically tailored this process to those companies currently working in offshore oil & gas so that they can build robust strategies for transition into offshore LNG and/or Renewable Energies.
The Origin – Transferable Skills Mapping (TSM)
Good practice dictates that companies hiring new staff will seek to recruit candidates who possess not only the best technical skills, but also good personal and business skills. Examples of the top 10 skills considered would typically include;
- Problem solving
- Clear communications
- Teamwork ability
- Work ethic
- Leadership and team management
- Understanding business strategy
- Data analysis
- Time management
- Commercial awareness
- Listening and providing feedback
Where candidates can demonstrate a solid grounding in these skills, they will typically have the flexibility to transition easily between different roles in a company. Hence, these skills are commonly known as Transferable Skills, as they can be equally valuable in a variety of roles or occupations.
Traditional TSM is also used by candidates seeking new employment. With this tool they can map out their strengths and weaknesses in each Transferrable Skill, and compare (or map) these against various employment opportunities. In this way the mapping can help to identify the best fit between the candidate’s strongest skills and specific job requirements.
Adapting TSM to strategic business diversification
As we use traditional TSM in an HR context, we can also employ a similar philosophy at a larger business context. Here, we consider and analyse the transferable skills that a company possesses and can leverage to transition their business into a new market area.
This requires analysis of two distinct areas;
- To what extent does the company’s current staff have the technical skills needed for the new business?
- To what extent does the company have the organisational strength and flexibility to succeed in the new market?While the first can be assessed on a quantifiable basis, the second needs a more subjective judgement.
The OWEL Corporate Transferable Skills Mapping (cTSM) process typically involves the following steps;
- Map the strength of the company’s existing technical skills, by engineering discipline and project execution function
- Compare this with the standard mapping of skills needed for each new business area
- Map the strength of the company’s existing (non-technical) organisation, such as Board, Finance, HR, Sales etc.
- Compare this with the standard mapping required for a company to successfully expand into each new business area
- Identify the main gaps (both technical and non-technical) and develop a strategic plan for mitigation, such as recruitment, training and/or M&A.
- Consider the impact of the new business on staff with non-transferable skills.
Role of cTSM in Offshore Energy Transition
OWEL has specifically developed cTSM in order to assist companies who are currently working in the offshore oil & gas market to diversify into more sustainable market areas. Whereas activity in offshore oil & gas is predicted to peak in the short to medium term (apart from decommissioning), adjacent and emerging business areas related to offshore LNG and offshore renewable energies are expected to show continued long-term growth.
We have created a library of the technical skills needed for a range of adjacent and emerging business areas, including FSRU, FLNG and FGTW in the LNG sector, and for Floating Wind, Wave, Tidal, Hydrogen and Energy Storage in the Renewable Energies sector. For each new business area, we have also identified the relative importance of each engineering discipline and project execution function. These standard library maps are used to compare the existing technical skills mapping for the company and so identify, and quantify, the degree of overlap. This is illustrated in Figure 1 below.
The second part of the cTSM analysis, for corporate strength and organisational flexibility, is more subjective and may be tailored to suit each individual company. However, typically this will include analysis of the following areas;
- Board: Current size, strength, expertise and strategic vision
- Finance: Balance sheet position and capacity for growth or acquisition
- Strategy: Depth of understanding of adjacent markets, competition, trends and drivers
- Sales/BD: Client and partner network for current products and new market area, and depth of understanding for a range of commercial models
- HR: Ability to handle a major staff growth and (re)training plan
- IT: Ability to handle major infrastructure expansion and use of latest industry-standard tools.
- Services: Strength of Compliance, Legal, Accounts, etc to handle growth.
Again, OWEL has created a standard mapping for the above which would ideally be present in a company to ensure a successful transition, and we use this as a benchmark against the current company situation.
Outcome
When the cTSM exercise is performed for a single potential business opportunity then the outcome is a map showing the degree of overlap and the key strategic gaps. This can be used to feed a strategic plan of action for the new business opportunity.
cTSM can also be used as a very effective way to asses several business options by comparing the degree of overlap, and associated gaps, for each opportunity. This analysis provides important strategic guidance to help select the option with the best chance of success.
Conclusions
Whilst TSM is a well proven tool at a personal level, it can also be adapted to a corporate level, which we call cTSM. A methodology has been developed by OWEL to apply cTSM to companies working in the offshore energy sector, based on a library of skills needed for a range of emerging business opportunities in offshore LNG and Renewable Energy sectors. This can be a valuable tool to address possible areas for diversification related to Energy Transition.
We believe that cTSM can help Clients identify business opportunities which are best suited to complement their current business, and so create strategic transition plans with an improved chance of success.
Glossary
BD Business Development
cTSM Corporate Transferrable Skills Mapping
FGTW Floating Gas to Wire (Power) Vessel
FLNG Floating LNG (Production) Vessel
FSRU Floating (LNG) Storage and Regassification Vessel
HR Human Resources
LNG Liquefied Natural Gas
M&A Mergers and Acquisitions
OWEL OpenWater Energy Ltd
TSM Transferrable Skills Mapping