Anadarko Petroleum – the importance of strong values
Some disasters destroy you, others define your worth.src: Anadarko.com
When Jim Hackett took the reins of Anadarko in 2003, it was a lame horse. There were serious worries about the share price that had the former CEO headed for the hills and it had missed its output targets for 3 years running. Jim focused on building a culture of execution, values and shared vision – core elements of Organizational Health – which soon reaped dividends. By 2010 the share price had tripled and continued to rise steadily. Then came the worst curve-ball possible, the Deepwater Horizon explosion gouged a scar across the face of the Gulf of Mexico. Anadarko, looked like one of the hands holding the knife, with a 25% stake in the BP well that blew. So how does an organization recover from such a massive blow?
Keeping it together
“[He] tells it like it is without the usual propaganda that people at his level are given to proclaim. Sincere, honest, trustworthy and intellectually strong.” – An employee on Jim Hackett,
CEO of Anadarko
"I will tell you that from the beginning of that event until the end, our core values guided us, and I think they guided us well.”- Jim Hackett, CEO. One of the principles that Hackett impresses on his employees is to take the long view: “We will not sacrifice long-term value for short term gain”. This focus on values, particularly during difficult times, gives Anadarko employees a sense of security and a culture they can truly buy into. They know that the organization will not fundamentally change its identity when under pressure and this makes people want to stay. Anadarko has an annual attrition rate of 5% compared to the industry average of 9%.
A good executive executes
“Every day at work is a good day. We are scientists and explorers who actually get to test our hypotheses regularly. My team and I convert chaos into logic, the abstract into reality and the unpredictable into real prospects…”– survey respondent
In the early years of his tenure, Hackett’s focus was on getting the company doing what it does with gusto.
People at Anadarko are allowed to operate freely within their roles. As one manager observed, “You get given a lot of responsibility, it’s got a ‘small company’ feeling with a ‘big company’ portfolio”.
When employees and management operate well, company performance soon follows. “The company’s operating performance has probably never been better,” said Al Walker, Chief Operating Officer. After the oil spill, the company had half its stock value wiped out. Less than 2 years later its shares are closing at record highs. It is now, according to one analyst “the most attractive takeover target in the industry”.Sources: