Ambition to action & Beyond Budgeting Bjarte Bogsnes

42 Pages·2011·1.93 MB·English

by  Bogsnes, Bjarte

From ”Blowing up the budget”
to ”Kicking out the calendar”
The next chapter of the Statoil journey
Bjarte Bogsnes
Vice President - Performance Management Development
Chairman - BBRT Europe
Classification: Internal 2011-04-11External
Some European cases
Beating the Europe’s most cost
competition 40 years effective universal
in a row bank
”I have been waiting
for this for 20 years”
(CEO)
CCllaassssiiffiiccaattiioonn:: IInntteerrnnaall 22001110--0049--1110E x ternal
Statoil in brief
•
Turnover and market cap
Arctic
approx. 90 bn. USD
North Sea &
•
20.000 employees in 34 Norwegian
Sea Russia
countries
• Canada
World‟s largest offshore
operator Caspian
North
• US Gulf of
Europe„s second largest Africa
Mexico
gas supplier Middle
East
•
The world‟s third largest
South
crude oil seller America
West
•Listed in New York and Africa
Oslo
Current production of oil and gas
Classification: Internal 2011-04-11External
Relative Statoil performance
RoACE – 2010 Total shareholder return 2010
ExxonM ConocoP
Chevron Chevron
BP Target Anadarko
Statoil Occidental
Total Shell
BG BG
Shell ExxonM Target
Occident Devon
Repsol
Eni Lukoil
Devon Statoil
ConocoP Encana
Petrobra Eni
Repsol Total
Anadark Petrobras
Encana BP
0% 5% 10% 15% 20% 25% -25% -15% -5% 5% 15% 25% 35%
RoACE – 2009 Total shareholder return 2009
ExxonM Petrobr
Statoil Lukoil
BG Target Anadark
Petrobras Statoil
Total Occiden
ChevrBoPn RepsBoPl Target
Encana
Encana
BG
Occidental Total
Devon Shell
Eni Eni
Shell Devon
ConocoP Chevron
Repsol Conoco
Anadarko ExxonM
-1% 4% 9% 14% 19% -15% 10% 35% 60% 85% 110%
*Peer group: Anadarko, BG, BP, Chevron, ConocoPhillips, Devon, Encana,
Eni, ExxonMobil, Lukoil, Occidental, Petrobras, Repsol, Shell, Statoil, Total.
Classification: Internal 2011-04-11External
Source: Barclays Capital
From calendar driven to business driven
Classification: Internal 2011-04-11External
The controller and the fisherman….
CCllaassssiiffiiccaattiioonn:: IInntteerrnnaall 22001110--0049--1110E x ternal
New principles
From calendar-driven to business-driven
No annual versions
– Update strategic objectives, KPIs, KPI targets, forecasts and
actions when necessary, triggered by external or internal
events (event = “big for you”)
Simple change and coordination controls
– Seek approval if big, inform if small. Inform other affected
units as required
Varying time horizons
– Target and forecast horizons reflecting urgency and lead times
People@Statoil
– Still annual performance evaluation, but against a dynamic
Ambition to action
Classification: Internal 2011-04-11External
Simpler and better …
… but not necessarily “easier”
Bad news for those
who want to be
instructed on what,
how and when?
Classification: Internal 2011-04-11External
The world has changed
– what about the way we lead and manage?
Implementation workshop
BBRT 10th Annual Conference
Bjarte Bogsnes
Vice President - Performance Management Development
Chairman - BBRT Europe
Classification: Internal 2011-04-11External
Outline
•
The case for change - what is the problem?
•
The Beyond Budgeting principles
•
The Statoil model - Ambition to action
–Target setting
–Forecasting
–Dynamic resource allocation
–Holistic performance evaluation
•
Implementation experiences and advice
Classification: Internal 2011-04-11External