RiverRipper's Guide to Energy

Big Oil:
If you don’t have any ethical issues with big oil this is one of the best places to be if you are very interested in energy. These companies are among the world’s largest companies and offer amazing career opportunities for MBA’s. Different companies provide better opportunities for different career paths, they are headquartered in a variety of locations, some value MBA’s much more than others, and some recruit in much larger numbers.

Advantages of Big Oil:
The most lucrative energy field to be: The compensation and benefits packages are among the best you will find post MBA without living in hotels and flying every week.
Career growth: there is always somewhere to move up to their massive size and due to a their hiring patterns management is made up of older folks, so there is a lot of need to fill these spots going forward.
Scope of Projects: You can be managing hundreds of millions if not billions of dollars a year relatively early in your career. The scale of everything in the industry is absolutely massive.
Job Security: Despite all the talk of getting away from our “addiction” to oil, the world will rely on oil for many years to come. In reality the world will still be running on oil when we retire in 30 years.
International Opportunities: It is almost a 100% guarantee that you will have multiple chances to live for a period of time overseas.
Dynamic Industry: There are bound to be big changes in the industry, from supply and demand issues to the environmental concerns...you wont be bored.

Disadvantages of Big Oil:
Personal Feelings: Simply put some people could never in a million years work for an oil company.
International Opportunities: You are just as likely to be sent to Nigeria or Angola as you are London or Singapore. If you don’t go then you are going to be hurting your long term opportunities.
Conservative Nature: Due to the size of investments they are pretty careful with choosing them.
Politics: Are bound to play a bigger role going forward...from US policies to the nationalizing of oil deposits. Though this will make things more dynamic and interesting from a management view point.
Some positions are very hard to get into, and they recruit mainly from a handful of schools. If you aren’t at one of those schools it will be very hard to get into those areas.

Info on the major companies to follow...

ExxonMobil: World Largest Non-National Integrated Oil Company
https://www.exxonmobil.com/USA-English/H ... at_mba.asp

Recruiting: They have a well developed process at their core schools. They strongly favor people on their closed lists, getting R2 interviews is much harder if you come in off the open list. Fit is very important since they picture people as career hires not just as summer or short-time hires. You have to sell that you fit in with their conservative nature, are very passionate not just about energy but about oil...having some background that you can position as related helps. Besides people with energy backgrounds, they tend to favor engineers for their GM program, military folks, and people with strong leadership and technical skills. Interviews will be behavioral and fit based, depending on the interviewer they can be challenging and ask unusual questions that are unexpected for people prepared for basic behavioral interviews.

Large MBA recruiting program from many Top Tier and regional B-schools. There are four overall areas that MBA’s will feed into. Upstream (Houston), Chemical (Houston), Downstream (Fairfax VA), and Global Services (Houston and Fairfax)...some finance/treasury positions are in corporate HQ (Dallas area). There are multiple businesses within these areas that people are placed into and it depends on needs of each business unit each year.

They are INCREASINGtheir recruitment of MBA’s and are expanding not just the numbers but where they are placing recruits. Many of their managers are close to retirement, so they need to fill the pipeline with young talent who can advance quickly and have broad skills to take over. They recruit at a lot of schools, from the ultra-elites to regional schools...the more desirable positions and higher pay definitely seem to go to the top schools they recruit at.

Exxon’s upward career progression favors the GM people over the pure finance folks, and willingness to go overseas is basically a must if you want to move up. They also strongly favor folks with technical/engineering backgrounds, if you don’t have this background its harder to get into the company and you are more likely to hit a ceiling. It is a huge corporation and is conservative in both its operation and personality; you most likely will wear a suit to work. The formal work environment can be tough for people who can’t function in that environment but they provide amazing opportunities for those who can successfully navigate the bureaucracy.

Most people who start there end up being career long employees and for good reasons. Great job security, lots of opportunity for advancement, and great benefits. Amazing work life balance, 40 hour weeks are the norm and talented people never leave based on compensation. The toughest thing is the expectation to be geographically flexible in terms of living for a few years abroad. However, they have amazing reputation for what they provide people in terms of assistance with the move and expat packages. And they love people who are willing to go to less desirable locations such as Africa.


General Management: Rotate their people every 18 to 24 months through a variety of job functions. Such as marketing, strategy, development, operations...you name it there is a chance you might end up doing it. The program is not a typical structure like a GE program, rotations are longer to allow you to really dig in and develop skills in that area. Probably the best opportunities in the oil industry for people who want to go into GM. Nothing on their site really about this program, they do have some info on positions that some GM people start in or rotate through.
Example of a GM type starting position: Global Marketing: Chemical

Finance Careers: Great program, you will have plenty of opportunities to advance but the sense is that it may not have as great of opportunities as some of the GM areas. More silo’ed in finance functions than the programs at some competitors. Treasury will give put you in the same location as the C-level employees, which and seems to be the more desirable of the finance areas.
Controllers MBA Program
Controllers Brochure
Treasurers MBA Program

Chevron: Second Largest Integrated Oil Company in the US
Locations: San Ramon (Bay Area) and Houston
https://careers.chevron.com/students/mba ... fault.aspx
Program Brochure


Recruit mainly from top tier schools and McCombs. They don’t bring in the total volume that Exxon does but the numbers into the choice spots are probably pretty equal. The main paths seem to be Finance and Marketing, Global Gas and Supply & Trading are smaller areas, but provides some of the more interesting opportunities.

Their numbers were about steady this year, they don’t seem to have nearly as big of an age gap as Exxon...especially in the finance area where their program is one of the longest running and best programs available for people interested in corporate finance. Their recruiting is definitely more focused on elite school than Exxon, and they have a more select core set of schools for the best gigs.

Recruiting, they have a well developed process at their core schools for their two big areas (Finance and Marketing). They have will come in the fall and do presentations. Finance interviews will be behavioral and fit based, 1st rounds are not that difficult but having finance experience will help. Marketing is two interviews, fit and behavioral, then a case. The case is more along the lines of a MC case than a marketing case...so if you want to target this do case prep with some MC people to get the frameworks and stuff down.

Chevron’s upward career progression favors the Finance people over the other areas. It’s starts as a two year rotational program, where one rotation is typically spent overseas (You guys picking up on that theme in the oil industry yet). They don’t have as strong of a preference for folks with technical/engineering backgrounds, but that or experience in the energy industry wont hurt. Chevron is much less formal it definitely has one of the looser cultures in the oil industry, dress is b-casual. This is not to say they aren’t conservative, due to the business they definitely are...though they don’t have the reputation of being as disciplined as Exxon with their strategy.

Once again, the place is filled with career employees...they like most oil companies have an amazing retention rate for their MBA’s. They have the same great job security, advancement opportunities and they pay well (not Exxon high but definitely towards the top of the scale). They too really want their people to be geographically flexible in terms of overseas. Location is preferable for some people...the bay area appeals to many more people. However, you will get the same paycheck if you are San Ramon or Houston.

Finance Careers: Probably the best finance program in big oil, 4 rotations over two years...one of which typically is overseas. Many senior executives passed through the program...including the CFO (Kellogg grad). Finance in Chevron will give you chances to possibly do some strategy work which is typically filled by GM folks in other companies. They don’t break their finance up into separate programs...you will do treasury, audit, comptrollers, investor relations, etc. However, it is a small program (10 or so a year) and they only hire out of a handful of schools. If you make into this program it offers some excellent opportunities.
Finance Development Program

Marketing: More GM than pure marketing, but less GM than Exxon since it is all very brand/customer focused. First two rotations are 6 months and are marketing based, one will be global and one will be customer facing. The third rotation is a year long and is an operations type role within their retail business. One month of this rotation will have your working at a retail outlet (you will work at a gas station)...dont worry you will be highest paid gas station attendant in history. It’s a structured program, and will give you pretty good exposure to the downstream side of Chevron but exposure to areas outside of brand and retail areas is limited. Chances of moving into upstream out of this area are minimal.
Global Marketing

Royal Dutch Shell: World’s Second Largest Integrated Oil Company
https://www.shell.com/home/content/caree ... _graduate/

Conoco Phillips: Third Largest Integrated Oil Company in the US
https://www.conocophillips.com/careers/U ... /index.htm

British Petroleum (BP): World’s 3rd Largest oil company
https://www.bp.com/sectiongenericarticle ... Id=7017455

From the ExxonMobile link:



River, could you expand on what they mean by "technical discipline"? I assume that would be things that relate to the energy industry? Geology?

RF

The sense I got was that the preference is for engineering, or something hard science or extremely analytical in nature. Computer Science, physics, chemistry, etc. I think if you were doing geology in the energy industry that would definitely give you a shot. However, if you were a liberal arts major who worked in some soft skill job...well then your chances are extremely slim. This isnt just something they say they prefer, it really is something they value. One thing I appreciate is that they are upfront about this preference unlike some companies who have internal preferences but they dont publish these and the only way you find out is 2nd hand

For a point of reference...I know the only non-engineer degree to get a 2nd round interview at Kellogg this year was an economy major who was going for finance.

Thanks River.

It appears that the energy sector, or at least the oil industry, is not very "career switcher" friendly. At least not to those who don't have the experience or educational background they are looking for.

Is that a fair assessment in general?

RF

Definitely not and remember you are talking about Exxon not all energy or even oil companies. However, each company does have their preferences and other companies have different ones. By the definition of career switcher energy as a whole is very open to it. I think most people going into it weren't in the energy field and even those with engineering degrees werent all actual engineers. Some were consultants, or in sales/marketing, or in any number of other job functions. Those that have energy backgrounds do extremely well with getting jobs, but that is common with every industry..whether you are talking about CPG, Healthcare, or banking. That just has to do with companies knowing that those individuals can show up and hit the ground running so to speak.

One thing I have noticed is that a lot of general management job descriptions seem to prefer engineering undergrad degrees. I think a lot of that has to do with many of the companies that have "GM" career paths being manufacturing/industrial companies. The career path to the top management postions varies by industry, for example CPG and Healthcare tend to use marketing. The GM paths are common in areas that rely heavily on engineering as it is, so being able to understand the products and how they are produced is a huge advantage for managers to have.

Career switching is definitely possible, the key is how you frame your skills and how you market yourself. GM positions want analytic skills, so you dont have to have a technical degree to show you have that but its assumed if you can handle the course work of an engineering degree you can succesfully analyze data. However, you could have the greatest engineering background in the world but if you cant show that you have leadership skills you arent getting a GM position either. So the key is to show you have the analytical skills no matter what your degree or work experience and to show that you can effectively lead people and manage projects.

Great topic! I've been on a few consulting projects with energy clients on this list, and I am definitely interested in reading more about post-MBA careers in this sector.

With regard to career backgrounds -- as an anecdote, my current assignment is with one of the supermajors (my location here in Australia probably gives away which one), and requirements for industry experience vary by functional area. Most of the managers and directors I work with (in the supply chain and finance spaces) either have "resources" backgrounds (mostly mining) or have strong experience in their respective functional areas. In contrast, many of the engineering managers are expats from the States or Europe with extensive oil-and-gas industry experience.

It may be an aspect of this region though, as the oil industry is not huge in Oceania and thus, demand for talent overrrules strict industry experience requirements. As part of my assignment, I work with many of the industry's suppliers on the consulting, construction and manufacturing side, and it's a similar story over at those companies' operations here as well.

Prashok, I think if you look at employees from top tier MBA's very few have oil experience prior to school. Almost none of the alums I talked to had any experience in the oil industry prior to their MBA's. My friends work work as engineers in the oil industry wouldnt bother going back fulltime since they already make great money and have opportunities to move up, and they would have the chance to get MBA's PT if they wanted. However, I bet there are far more people with prior oil experience coming out of schools like McCombs and Rice. Out of the 8 people I know who got offers from oil companies here this year not one worked in the oil industry before.


***updated Chevron...

Thanks riverripper -- that actually sounds similar to what I have seen here (though I had just assumed it was due to the local talent pool).

Do job functions dictate hiring requirements as well? The managers in our corporate offices (who mostly have MBAs) don't seem to have much oil experience, but they also don't work directly in operations -- and they mostly hail from companies like BHP Billiton, or from consulting firms pre-MBA. In contrast, the upstream and other engineering managers (which I guess is less of a post-MBA pathway) do indeed have more industry experience.

I would say that is true for most companies. However, I think most positions top tier MBA's recruit into are high level corporate entry points. The companies that send you to operations positions usually do it after several years and in a management position. Some will have you run finance, procurement, or functions like that for a large site fairly very early on but it usually take at minimum at several years.

Most alums I talked to that are well into their careers have operations but often these were in higher level management positions and the first one was 3 to 5 years into their career. Remember I am also looking at GM positions which take far more hands on roll in operations. Finance people might run on site finance duties but I think it would be very rare to have a "operations" role. Marketing people at some companies might take responsbility of a region of retail outlets (much more common at some companies, like Chevron). Some companies have strategy paths that people might get into operations positions out of.

One thing to remember is once you are hired and finish your initial rotation or job functions where you go is often up to you. You have to use your network, find opportunities, and make it happen. People arent going to hold your hand nearly as much 5 years into your career as they will 1 year in. To move up in the GM path you will want an operations positions or else you will limit your career growth since you wont have a view of everything you need to. If you are OK with moving up the finance silo, marketing silo, or something like that...then operations might help you but lacking it wont hold you back.

River,

What is your thoughts on the culture and nature of work at the utilities? I was speaking to an old friend who now works for a major utility and he stated while the pay is good, the work can tend to be boring. He mentioned that the unregulated division of his company was a much more interesting place to be working.

Also, looking at your list, I was curious if you considered SDG&E and Gas Company as potential major employers as well, or just considered them subsidiaries of Sempra?

River,

Care to comment on the cyclical nature of the oil industry?

My father worked for a major oil/gas company in Canada and we had to relocate a couple times. When times were good, the money just flowed, but when oil prices dropped a lot of people were laid off and offices were closed and consolidated.

RF

I'll jump in here and hijack River's thread. I work for a super major and I've gotten a good feel of the good times and bad with the most recent swing. First off the old days where mass lay offs and office closing were the norm, have since past. Some of these companies have been in business for over a hundred years and their strategic plan to invest in capital rolls out 30-50 years.

The industry made the mistake of not hiring in some of the down turns and the result is a large amount of very old and very young employees. During the most recent boom we've tried to make up for it by recruiting 1/3 of our total employees through campus recruiting. Still our CEO says we are going to keep hiring and investing in people because of the challenges ahead. With that said we have a very large contractor base and a lot of them are being let go or moved to support a more financially efficient organizations. I'd say 98% of employees here are not concerned at all about losing their job and I'd say that 75% of contractors are.

Last point, when times are good the money does flow, the travel is up and so is the spending. I don't know if big oil is really going to go back to that model we are investing in video conferencing, collaboration technology, etc. to cut down on travel (not eliminate it) the good news is that when oil gets back above 60 all my meetings can go back to being catered.

anyone know if you can work on alternative energy projects for the big oil companies during the GM rotation, or do they want you working oil? i know most of them have some projects going on...

I think there is a huge variation in MBA careers in the utility industry...at least straight out of school. The major utilities have MBA programs (Duke, PG&E, Exelon, PSEG, Dominion, etc.), and recruit. How they recruit really varies as does how well they pay. I believe PG&E not only has the most well developed program and recruiting strategy, but they are at the upper end of the pay scale. Utilities dont pay what oil companies do, and also trail things like widely diversified and tech companies. Hours can be longer depending on your area. There are some interesting businesses but like all companies there are going to be some boring areas.

From what I have seen, its usually parent companies who recruit and then move people around. A lot of utilities have a large number of subsidiaries to limit their liabilities. I know one company I interview with hires corporately but will send you to different units for your job...the "parent" company is actually a pretty small operation.

I think Utillities do offer some great opportunities, and going forward there will be lots of interesting place in them for MBA's willing to look for the right fit. I think california will be one of the more interesting places to be due to their renewables mandate. Utilities will be investing billions in their infastructure in the next few years, this will provide a lot of interesting and meaningful projects for people with MBAs. Another big advantage of utilities is there is a great deal of geographic mobility for people joining. If you start at one company and several years later want to move to a different part of the country...chances are that there is going to be a large utility or two in the region.