Identity: An Exploration into Purpose and Principles at Shell
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Volume 3 Number 1
Identity: An Exploration into Purpose and Principles at Shell Sixtus Oechsle Shell Oil Tom Henderson Shell International Ltd.
INTRODUCTION Society's expectations of a multinational corporation have changed over time. A few years ago, Shell began a journey to discover what these changing expectations were and how we could meet them. In short, we sought to de®ne our purpose. This is a `warts and all' account of this sometimes dicult, sometimes frustrating, but always important journey to become the world's most admired company (WOMAC). Shell possesses many unique attributes that serve as a source of strength, but can also be a weakness. It is the world's oldest unresolved joint venture Ð 60 per cent Royal Dutch, 40 per cent Shell. Its 100year-old joint venture provides it with an extraordinary capability to manage joint ventures, but denies it the freedom to operate as a single unit. Oil is not its only business. It has ®ve distinct core businesses. There is strength in broadness, but it can leave a mixed message. Shell is large, with over 800,000 permanent and contract employees in over 3,000 operating entities spread across 144 countries. Again, it can be dicult to manage this mammoth operation with a single message, and to create Shell `ambassadors' out of every employee. Shell does not have a CEO. Instead, it has a committee of ®ve managing directors. Thus, it has no single head. Furthermore, it is a collegiate, consensus-driven
organization. Because of this, we tend to make fewer mistakes, but we also tend to make fewer decisions. It is hard to stay agile in a quick-paced environment. Thanks to our Dutch roots, we also have a Calvinist attitude. We don't like to `toot our own horn.' Finally, we are caught up in society's perception of `Big Oil.' This is an image of power, but we are lumped into the same category as everyone in the industry, and thus are seen as no better than the worst of the industry. Our challenge was to build on these strengths and reduce these weaknesses. In 1991, US Shell earned $26bn in gross revenues, and $0 in pro®t. This was a wake-up call. Upwards of 55 per cent of the sta was let go, many great workers and perceived future leaders among them. About a year and a half later, Shell brought in a new CEO with a change of plan. He knew that if we were to survive, we had to do business in a very dierent way. He set up a team of 15 people from across the company to go around the globe and benchmark processes, to ®nd out what was `world class' in human relations, brands, cost, leadership, and so on, then to establish contracts with each of the Shell businesses to help them be better businesses. After six months of this, we found that people understood the concepts. After all, we did not have any `slow ponies' Ð we hired only the best. However, they were not listening to each other. They had no way to
Corporate Reputation Review, Vol.3, No. 1, 2000, pp. 75±77 # Henry Stewart Publications, 1363±3589
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Identity: An Exploration into Purpose and Principles
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