Medco Leadership Pipelines: toward Global Energy Company

MedcoEnergi is an integrated energy companies with approximately 3,000 people worldwide including more than 500 professional engineers. MedcoEnergi’s oil and gas business operates several producing and exploration oil and gas blocks with locations stretched across the country from the far west to the most eastern part. Its core business in energy has help to fulfill the supply of energy in Indonesia.

More than that MedcoEnergi has become an Oil and Gas E&P Operator around the world, from South East Asia to Middle East and the United States of America (USA). MedcoEnergi’s success in Novus Petroleum Ltd. shares acquisition in 2004 and competency in increasing oil and gas output from idle and sour fields in Indonesia have provided MedcoEnergi to embark on new ventures and terrains in the global arena. With the increasing business opportunities of the oil & gas exploration and production overseas, MedcoEnergi entered into the United States of America, and several Middle East and North African countries such as the Sultanate of Oman, the Republic of Yemen, the socialist country of Libya, and the Republic of Tunisia (1) . Only few Indonesian companies have achieved this kind of reputation and success story in entering the world market.


The Leadership Problem in Medco
The success story of MedcoEnergi (Medco) cannot be separated from Arifin Panigoro leadership as its founder. From 1980 until 1998, Arifin had lead Medco toward excellent as the largest oil company in Indonesia. With his leadership, Arifin had demonstrated integrity and conviction toward realizing his vision on expanding the business through acquisition on new oil field in overseas.

After Arifin Panigoro leadership, Medco trying to make a smooth succession while trying to continue the vision toward a global energy company. Based on Accenture diagnostic found that MedcoEnergi did not have a formalized integrated company-wide leadership program to address the requirements and conditions for a company to grow from within and knowing how leaders can teach leaders. In other words MedcoEnergi has a problems in supplying “leadership” in its organization. They don’t have leaderships pipeline.

Leadership Development Program (LDP) as a Leadership Pipeline
Medco success story under Arifin Panigoro leadership need to be maintained through a leadership pipeline. This “pipeline” will keep a record of future leadership candidates. The leadership development program is a form of an organization’s leadership pipeline which provides Medco with a sustainable supply of quality leaders to meet the challenges of today and tomorrow.

The leadership development program (LDP) initiated by Accenture was part of an integrated program management (IPM) which consists of several initiatives to ensure alignment, coordination, and integration among multiple improvement initiatives. IPM acted as a governing body to align initiatives that were formed based on the key findings of the High Performance Business Framework project. It covered the coordination and facilitation of a total of 23 initiatives implementation at both the corporate and subsidiaries levels. The Leadership Development focused on designing, developing and monitoring its Leadership Development Programs for Senior Management level. During this engagement, Accenture worked with 12 Medcoenergi's best talents and all directors from four different subsidiaries within 6 months in:

1. Developing Blueprint for Leadership Development Program which includes coaching, action learning and workshops.
2. Creating a company-wide integrated program to develop leadership capabilities.
3. Designing and develop action learning project, workshop material and format based on their leadership competencies definition and requirement.
4. Implementing and monitor effectiveness of leadership development program
5. Creating a Leadership Statement to establish a formal definition of leadership to strengthen culture and values.

These several initiatives are aimed to provide Medco organizations with a sustainable supply of quality leaders to meet the challenges.

The Benefit of each Initiative
Under this program there are several benefits that Medco get. The first and the most obvious benefit related to the morale for the entire leader in Medco to keep their vision implemented to the real business. Various coaching and training program will boost the senior management morale toward leading their organization. The motivation from leaders is expected to generate a snowball effect of positive outcomes. Other benefit comes from the leadership statement created by the leader that will provides better vision. This vision makes problem solving easier and keeps the group from being blindsided. Also, the more aware leaders are of the group, the better they are at creating a solid set of actionable goals which can lead to success.

But beyond of all that the company-wide integrated program which includes coaching, action learning and workshops implemented in these initiatives is tailored by Accenture to be an experience based leadership program, a method in helping organizations to grow the leaders they need to achieve high performance. Experience based leadership program as defined by Accenture uses a powerful, research-driven framework to link the leadership development activities an organization already has in place—classroom training, assessment centers, career development, succession planning, performance management and the like—with real work assignments and with innovative uses of information and communication technology (2). The result is a comprehensive process for developing leaders at all levels of an organization.

Based on Accenture explanation, experience-based leadership development consists of three major processes —preparing, developing and preserving—that together produce skills needed by leaders at all levels as well as a concept of leadership practice that encourages lifelong learning (3). It also stated that some experiences can be planned; others “just happen.” This is why a leadership development needs to be tailored with an experience based program so the participant could get a “just happen” experience from the program.

The major benefit taken through experience-based-leadership program tailored by Accenture is the participant will extract wisdom from experience they learn in class. The various initiatives in this program had equipped Medco top management to mine their experience continuously and intensely for insight into what it takes to lead, what it takes to grow as a leader and what it takes to cultivate the leader in others. This will also provide Medco future leader to maintain the vision toward global player in energy business.

Reference:
(1) Medco Annual Report, 2009
(2) Thomas, Robert J. & Srikanth, Rajan; Accenture Reseacrh Note, Leaderships & High Performance: Experience is the Best Teacher; February 2005.
(3) ibid
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