People. Greg Nakanishi Vice President, Human Resources. People Greg Nakanishi
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1 People Greg Nakanishi Vice President, Human Resources 50
2 The Business Imperative Capitalize on Market Growth Best in Class Employees 51
3 Towards 2010 HR Challenge Talent Shortage Increased global activity Big Crew Change Cycle gap from 90 s College output for engineering low in North America Personnel loss to customers Meeting the needs of international growth West to East Nationalization of workforce Different needs for different cultures Increasing technological complexity in oil patch Increased education levels Shift in training requirements Accelerated technology cycles 52
4 53 30% 25% 20% 15% 10% 5% 0% Age Demographics < to to to to to to to SPE BHI Age Distribution BHI Engineers SPE Membership
5 Petroleum Engineering in the USA Number of Programs Currently only 16 universities offer PETE programs, down from 34 in the 1983 Student Enrollment In 1983 there were 11,014 BS students enrolled in PETE programs Only 1,732 BS students enrolled in the US in are in TAMU, UT, TT Less than 300 BS degrees granted in
6 Towards 2010 HR Challenge Talent Shortage Increased global activity Big Crew Change Cycle gap from 90 s College output for engineering low in North America Personnel loss to customers Increasing technological complexity in oil patch Increased education levels Shift in training requirements Accelerated technology cycles Meeting the needs of international growth West to East Nationalization of workforce Different needs for different cultures 55
7 Workforce Productivity Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Headcount Revenue per Employee
8 Towards 2010 HR Challenge Talent Shortage Increased global activity Big Crew Change Cycle gap from 90 s College output for engineering low in North America Personnel loss to customers Increasing technological complexity in oil patch Increased education levels Shift in training requirements Accelerated technology cycles Meeting the needs of international growth West to East Nationalization of workforce Different needs for different cultures 57
9 Baker Hughes Engineers North America 85% / 90% Latin America 98% / 125% Europe 88% / 138% Africa 58% / 78% Middle East 21% / 28% Asia 76%/133% 58
10 Engineering/Manufacturing Graduates 179,066 (USA Only) 590, % Reporting 161, % Reporting 470, % Reporting Source: UNESCO Global Education Digest
11 Middle Eastern Engineering Talent Baker Hughes is targeting the top universities in the Middle East American University in Cairo American University of Sharjah Sultan Qaboos University King Fahd University Sultan Qaboos University 60 Texas A&M Qatar King Fahd University
12 Russian Engineering Talent Supporting programs at Moscow State University, Novosibirsk State University Internship programs for students from Gubkin Oil and Gas University Moscow State University Expanding relations to Siberian Oil & Gas and Polytechnical Universities Gubkin Oil and Gas University 61
13 Towards 2010 Meeting the Challenge Recruitment Global College Recruiting Group Enhanced university relations BHI branding High Performance Culture Focus on technology, people and globalization Development Global Training Group Enhanced development programs EDP Cornerstone programs Blended learning approach: e-learning Middle East education center Retention Competitive compensation, Pay for Performance Competitive benefits and innovative wellness programs Structured development and career paths Organizational changes new opportunities 62
14 Towards 2010 Employees are the key drivers in all our strategies We understand the magnitude of the challenges facing our industry over the next decade, but we feel short term tactics and long term strategies are in place that will enable us to: Meet the current challenges, Further differentiate ourselves from competitors, and Position our company to capitalize on the emerging global opportunities 63
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