The Daily Work of Influencing Your Partner
By James Bamford | Tuesday, July 18, 2017
IMAGINE YOU ARE the executive accountable for one of your company’s large non-operated joint ventures. You have a team of people watching the asset, performing assurance, and challenging the Operator’s approach to value and risk management. Virtually everyone on your team is an engineer or a finance person — linear and quantitative thinkers down the line, comfortable working in environments where things add up, where there is a direct cause and effect. But just doing great work is failing to move the needle at the Operator.
How do you coach these people to become great influencers?
Over the years, Water Street has developed a range of tools to help non operators improve their strategies and tactics for successfully influencing Operators. Many of these tools are aimed at helping the asset manager, or the team as a whole. But what about the individual team members working in the trenches, performing assurance, reporting, and interacting with the operator staff at committee meetings and in other venues? How should they approach influencing and be enabled in their daily work?
To help non operator asset teams, we’ve developed a 33 practice checklist of ways to do this (Exhibit 1). We divide the practices into two categories — things that an asset team member could do mostly on their own, and things that require broader company support to fully bring to life — and characterize them against the benefits they could provide. In our experience, we’ve found influencing practices have the potential to generate up to three benefits: Improved insight and understanding of the Operator (which allows for better messaging — both in tone and in timing — and enables greater empathy), more and stronger personal relationships with the Operator (which creates the basis for receptive communications and improves information flow), and ultimately, a means to directly influence the operator.
To be clear, the idea is not to immediately launch all of these — but to find a few, and start doing them. These practices might include:
- News Alerts: An individual asset team member might set up news alerts on the Operator (whether through Google, Bloomberg, LexisNexis, or other information aggregators) to raise awareness of the Operator organization and the broader environment in which the partner works — a practice which creates greater understanding, and a basis for launching broader personal conversations (i.e., by engaging peers in the Operator about the news).
- Student of Operator’s JVs: Team members might generate a list of the Operator’s other JVs, and become a student of its approach in similar assets — i.e., figure out how each JV is structured, talk to people about how different JVs are performing, understand what role the non operating partners are playing, and look for patterns that allow for better understanding of the Operator across assets to identify approaches, risks, and opportunities that might be translated into the asset close at hand.
- Internal Peer Network: To the extent that the company is in other JVs with the Operator, team members might establish informal connections or a more formal peer network with colleagues in the company to trade insights about the Operator — including its performance and capabilities, its approach to negotiating certain contractual provisions, whether and how it has been susceptible to influencing, and other details that foster understanding and, potentially, leverage.
- Relationships with Other Asset Peers: Team members might seek to develop informal relationships with functional peer(s) within the Operator who are working in assets where roles are reversed — i.e., where the company is the Operator, and the partner is a non operator — as a way to gain mutual insight, open up a broader dialogue, and create future influencing channels.
- Cadence Calls: An individual asset team member might institute informal monthly or weekly catch up calls with their peer(s) in the Operator to hear what’s going on, share ideas, gain and provide general context, and create the expectation of ongoing dialogue, thereby fostering a broader and deeper relationship over time.
- Consultants as Messengers: Where relevant, members of the asset team might use the company’s own external technical or other consultants to communicate directly with the Operator — i.e., sharing independent analysis and perspectives on potential risks or technical alternatives. When such consultants are highly respected in the industry, an Opera tor may be more open to their ideas, as they may be perceived as more independent, credible, and less prone to pushing the company’s agenda.
- Company Ideas Day: If the company has considerable experience in similar basins or with similar technical issues, the team might organize and invite the Operator to an “ideas day” at its technical center or other company facility. The concept is to invite 5 10 staff from the Operator to the company’s office, and structure a day around a series of 15 20 minute presentations in which company subject matter experts quickly share ideas, data, and approaches that might be relevant to the asset.
The concept is to not to “push” the operator to adopt any of them but, rather, to offer a “sampling menu” which the operator, if interested, can ask for more information and help on any of them.
The practices on this checklist are drawn from our client work, as well the experiences of several hundred asset team members who have participated in our training workshops on non operated asset management excellence.In those sessions, what we find most surprising is how few non operated asset team members deploy the most basic practices solely within their control –like setting up news alerts, or listening to operator earnings calls. Based on anonymous surveys we do in advance of our training workshops, most practices on the list are used by less than 20% of team members — and many are used by less than 5%.
On the plus side, we have also found that using the checklist to provoke a 45 to 60 minute conversation within an asset team about influencing — drawing out their success stories as well as failures — can jump start how people think about their own work and motivate them to be driven by the music of influence. It also helps an asset manager identify what larger initiatives — like proposing a peer review, suggesting a specialist site visit, or offering a “company ideas day” — seem to garner interest and are worth seeking internal support to propose to the Operator.
In many cases, we follow this practice focused session with a discussion on the “art of influencing in a non operated asset” — where we introduce the seven ways to approach influencing conversations with an Operator. That is the topic of part two of this series.