Building better futures

Leveraging action learning at Kentz Engineers &

Constructors

Action learning: Assessing the value

Henley, March 2010

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Presented by:

Takis Karallis: Group HR Director, Kentz Group

Eric Sandelands: Director, Corporate Learning

Consultants Ltd.

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Overview

• Who are Kentz and what do we do?

• A strategic view of learning and development in Kentz.

• How action learning helps us develop our people – at all levels and

around the world.

• What action learning means in practice in Kentz.

About Kentz Group

Our Vision

We are continuously striving to meet

our vision and are dedicated to

innovation and excellence in the

provision of engineering and

construction services.

'To be recognised globally as the

specialist service provider of

choice'

Our Purpose - 'Building better

futures‘

What does this mean?

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Kentz Vision, Values & Purpose

Purpose

“Building Better Futures”

• For our Staff by ensuring

– Home Safe

– Challenging Projects

– Life Career

– A sense of belonging

– A sense of adventure

• For our Customers by focusing on

– Building a safer workplace together

– Enhancing their reputation

– Adding to their competitiveness

• For the Communities we serve through

– Home Safe

– Employability and Sustainability

– Care for the environment

Values

Safety The safety and health of all our employees is the most

important value held by our company No one gets hurt

and everyone goes home safe and well.

Reputation Our current and future success stands on our reputation

Tenacity We are committed to our clients to delivering whatever it

takes without compromising our values

Pride We take pride in everything we do

Loyalty Our peoples loyalty to our business, our clients, our

partners is unquestionable

Respect We respect all individuals, cultures and the environment

within and connected to our business

Teamwork Working together to achieve organisational goals

Vision

“To be recognised globally as the specialist services provider of choice”

Key locations and selected key projects

Sustaining our Turnover in excess of US $ 600M

Europe

• Aviva Stadium

Redevelopment,

Ireland

• Marathon

Alvheim FPSO,

Norway

North America

• Suncor Vogageur

Upgrader

• Kearl Oil Sands,

Canada

Caspian

•TCO SGI/SGP

Kazakhstan

•BP Shangashal

Azerbaijan

Below freezing winters in Russia to Hot arid deserts of ArabiaCOLD

-50oC

-58oF

HOT

50oC

122oF

Regional Operations

• Projects completed in 61 countries

The Americas

• Atlantic LNG

Trains 1, 2, 3 and 4,

and Reliability

projects,

Trinidad

• SBM Petrobras

• RioPolimeros

Petrochem.

Complex

Brazil

African Region

• Medupi Power Station

South Africa

• Rio Tinto Ilmenite Mine

Madagascar

• Refinery & Coal to

Liquids Shutdowns

South Africa

• Kuito 2A FPSO,

Angola

Middle East

• Jubail Acetyels Complex

Saudi Arabia

• Berth 6

• Pearl GTL

• Sidra Medical and

Research Centre

Qatar

• KOC PMC

Kuwait

• ADGAS

• OGD III

Abu Dhabi

• OMV CPF

Yemen

Arctic Region

• SAK 1 Chayvo

• De Kastri Oil

Terminal

• SAK 1 & II O&M

• SAK II –

Lu

nskoye OPF

• EPC 4 –

ExxonMobil

C

ommunity Centre

•

S

AK 1, EPC 1 -

O

dputu Civils

• LUN-A

Of

fshore Platform

Asia

• CSPC Nanhai

Petrochemical

Complex,

China

• Murphy Oil

• Janamanjung

Power Station,

Malaysia

• Banyu Urip

Indonesia

Australia

• Gorgon Construction

Village

• Gorgon Telecoms

• Dawson Coal

• Project Magnet

• Woodside Energy LNG

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Revenue by Business Unit

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Construction

Site wide Construction SolutionsStructural, Mechanical & Piping

Electrical & Instrumentation

Specialist EPC*

Onshore Modular Production FacilitiesTurnkey Temporary Facilities

Turnkey Utilities and Offsite FacilitiesTurnkey Port Facilities

Small Capital Project SolutionsControls & Automation (TSI**)Telecommunications Systems

Power Projects & Services

Technical SupportServices

Pre-EPC award (FEED***)Integrated Project Management

CommissioningMaintenance & Turnaround

Offshore Services

Revenue by Business Unitbased on FY 2008 US$643.4m

Revenue by Business Unit basedon FY 2009 US$704.7m*

* Analyst Expectations for Revenue for 2009

Offshore

Marathon FPSO, Norway

Onshore Processing

ExxonMobil NefteGas OPF, Sakhalin

Island, Russia

Petrochemicals

SABIC, Sharq Ethylene, Polyethylene,

Ethylene Glycol, Saudi Arabia

LNG

Atlantic LNG (BP/Repsol/BG),

Trinidad

LNG

The Market Place for Kentz

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Oil and Gas Sector Positioning

Key Clients

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International Oil &

Petrochemical Companies

National Oil & Petrochemical

Companies

EPC/PMC’s

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Case Study, Australia• Gorgon LNG Construction Village

Location:

Owner:

Primary Contractor:

Estimated value to Kentz:

Peak Manpower:

Anticipated Duration/Finish:

Description:

Scope of work:

Barrow Island, North-West Australia

Chevron, Exxon Mobil, Shell JV

US $400 million (Kentz 1/3 share)

600

31 months/Dec 2011

Design and construct contract for a state-of-art 3,300 person construction village.

The TDKJV will provide engineering, design, procurement, project management and multi-discipline

construction services for the 3,300 person construction village to support the Gorgon Gas Field development.

The schedule-driven project comprises ten building clusters and each cluster will accommodate 348 people/c

to house 3300 people which will be completed over 11 stages of delivery.

Separate potable water and fire systems will also be provided by the TKJV.

A key design feature embraces the concept of being an „industry lifestyle differentiator.‟

All accommodation modules are fully transportable.

The development of the Greater Gorgon gas fields involves subsea pipelines to Barrow Island for an onshore

gas processing facility comprising three, 5 million t/pa LNG trains and a domestic gas plant.

Barrow Island is a Class A Nature Reserve and the TDKJV is committed to minimising all impact to the

environment during project execution.

Kentz, Thiess Pty Ltd, Decmil Pty Ltd (TDKJV)

Evolution of Organisation Structure

Up to 2006 2007 -2008 2008/9 ………

Subsidiaries

Average size of

Annual Revenue

circa US$180m

Company

Operated as

Individual islands

Regions with

Regional Business

Units

Revenues up to

Circa US$500m

and Business

Units Take shape

Within Regions

Regions &

Global Business

Units

Commencement

of Global

Business Units

With Regions

……..Future

Global Business

Units

Global Business

Units

Poor

Significantly

more

Efficient

Organisational Efficiency through Focus

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Aligning learning and strategy

• Kentz needs to develop

leaders at all levels

capable of achieving the

strategic vision.

• Alignment with strategy is

crucial, including

addressing balanced

scorecard areas.

• Action learning connects

learning with strategy and

action.

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Learning and Development

SM

DP

• Supervisory Management Development Programme which allows graduates and trades people to develop into junior supervisory positions.

• The four elements are REEP, QEEP, BEEP, EMSP.

SE

C • Skills Enhancement Courses are a series of internal and external Skill Enhancement courses for the whole Group to develop their current skills.

Ed

ipL

M

• Executive Diploma in Leadership Management supports employees with degrees to move into junior management level positions.

MB

A

• MBA has been established to support and develop mid-level managerial talent.

‘Building Better Futures’

‘Our people are our greatest asset’

17 yearsthe average length of service for

the

top 100

core management

34%of top core management have

20 years or more

service with the group

over 35

different nationalities

within our 10,834*

employees working in 26different countries

40 employees

have completed our new EPC

management

programme

* Average number of employees for first 6 months of 2009.

Joining the dots.....

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Includes:

CEO and senior management inputs/

presentations/ mentoring/ corporate

sponsors.

Access to strategy sessions/ client

meetings/ documents, reports and data.

Use of balanced scorecard as a learning

tool, but also as a source of data.

Strategic HRM focusing on succession and

a talent pool for growth.

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Balanced Scorecard – Financial & Customer

Dimension Objectives Measures

Financial

Reduce Overhead Costs Reduction in Real Overhead

Cost

Increase margins

Average gross margin by

business unit;

- EPC

- Construction

- Support Services

PBT & PAT in absolute and

percentage terms

Maintain Debt/ equity ratio Borrowings: Shareholder funds

Minimise bad debts

Monitor the credit worthiness of

our clients – particularly new

clients

Monitor Treasury

Management

Interest Income

Exchange Gain/Loss

Increase cash flow

Cash flow in projects being

tendered

Cash flow in projects being

executed

Increase growth

Backlog V corresponding prior

periods

Turnover V corresponding prior

periods

Dimension Objectives Measures

Customer

Safety Reputation Lost Time Incident

Value for MoneyQ: Do you think Kentz provides

Value for Money?

Enhance Customer

Credibility

Increased involvement in FEED

(front end engineering design),

feasibility and or PMC (project

management Contractor) phases

of projects

Certainty of DeliveryQ: Do you think Kentz provides

value in certainty of delivery?

One Stop Shop

Q: Did you find the full range of

services provided by Kentz gave

you a one-stop-shop approach?

Q: Was this of benefit to your

project?

PartnershipIncreased participation in

customers tendering model

Global Brand

Q: Is it important for you, when

selecting Kentz, to know we have

a global presence/reputation?

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Balanced Scorecard – Internal Systems & P&C

DimensionRevised Breakout

Group Measures

Internal

Systems

Safer Workplaces

1. Compliance of Safety

Leadership Audits

2. HSE Leading / Lagging

Indicators per

HSEBSC

3. Compliance with B2B training

program

Reduce Risk

Reduce the proportion of level 4

Risk projects – No. of projects

Downgraded from level 4 risk

after

award of new project.

Operational

Excellence

1. Utilisation of our Business

Systems (KPS) on new projects

2. Completion of training

programme

Aligned Business

Systems

1. IMS Compliance

2. Monthly Reporting Compliance

Improve Sales

Performance

1. Number of Tenders won by

Value

2. Number of tenders awarded

equal to or above margin

benchmark

3. Market Intelligence – No. of

latent intelligence gaps that

appear

Relationship

Management

% completion of customer survey

at end of projects

Leverage EPC

CapabilityIncrease of EPC Business –

DimensionRevised Breakout

Group Measures

People &

Culture

Build project

management capability

Step 1 – quantify how many PM‟s we have

now in the categories of

Project Manager, Snr. Project Manager &

Project Directors.

Step 2 - 2009 is to target 10% growth in

Project managers on average across the

three areas

Engaged & Aligned

organisationCompletion of Personal Scorecards

Global Culture Implementation of Global Business Groups

Leadership

1.) % of new leaders promoted within

12mths of completing the EdipLM or MBA

programs

2.) No. Promotional Events /No. Training

Interventions %

3.) Succession Planning

Build EPC Capability Total EPC project revenues year on year

Tenacity Pride

Loyalty

Respect

Team

Reputation

Safety

Our Purpose : BUILDING BETTER FUTURES

Our Vision:To be recognised globally as the specialist services provider of choice

Customer Value Proposition

Product / Service Attributes Relationship

Value forMoney

SafetyReputation

EnhanceCustomerCredibility

One stopshop Partnership Global

Brand

Certaintyof

Delivery

Image

OperationalExcellence

ReduceRisks

AlignBus.

Systems

ImproveSales

PerformanceRelationshipManagement

LeverageEPC

SaferWorkplaces

Innovation

Innovation

Engagedand

Aligned Org

Build ProjectMgt

CapabilityLeadership

BuildEPC

Capability

BuildGlobalCulture

Cost Management Strategy Profit Management Strategy

Maintain

DE Ratio

ReduceOverhead

Costs

Sustainable Shareholder Value

MinimiseBad

Debts

IncreaseCashFlow

IncreaseMargin &

Profit

Increase

Growth

Treasury

Mgt.

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For us, action learning is... (Marquardt)

Involves

• Small groups

Working on

• Real problems

Taking action

• Learning (individually, group)

Engaging early career talent

Supervisory Management

Development Programme

New graduates, qualified trades

people, other high potential

people.

Different rotations, exposures to

issues, experiences.

Problem-solving workshops.

Mentors

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Supervisory Management

Development Programme

Skills Enhancement Courses

Group Human Resources Strategic Advancements

Some SMDP workshops

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Frontline

Leadership W/S

Frontline

Management W/S

Entry point

S.E.C‟s

REEP

ROTATION EXPOSURE EXPERIENCE PROGRAMME

Engineering

Graduates

REEP

Booklet

6 Mths

Rotation

Mentor/Mentee

Group meeting

Completion

18 Mths

Rotation

6 Mths

Rotation

S.E.C‟s

6 Mths

Rotation

Mentoring

Booklet

Career Planning

next step

Rotation in :

Finance ,Marketing /

Business Development

, Procurement

Planning , Proposals ,

Design / Design , HR ,

QA/QC , HSE and

coupled with exposure

on site

Join relevant

Professional

Membership

e.g IEI

Continuous

Professional

Development and

evidence

workbook

ENGINEERING

GRADUATES

Mechanical , Electrical ,

Instrumentation and Civil

Skills enhancement courses – all levels

A range of skills enhancement courses

are provided for people at all

levels, worldwide

Examples include:

• Dealing with difficult people

• Influence & assertiveness

• Communication skills

Participants bring their live problems,

solve them in small groups,

generate solutions to try back at

work.

Delivered recently in Ireland, Middle

East, Russia, South Africa

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Executive Diploma in Leadership & Management

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Candidates drawn from the global

business.

Around 2/3 promoted into more

senior roles within 12 months of

completion.

Work in global teams on live

company issues/ problems.

Fully supported by senior

executives including CEO.

Issues identified included:

•Interaction and communication

barriers between business units.

•How do you lead others

successfully in time of transition?

International action learning MBA

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3 action learning projects (ALPs)

One major strategic project

Evaluative assessment of

managerial learning

In association with Business

School Netherlands

Examples of projects:

•Measuring organizational performance

•Developing group branding strategy

•Black economic empowerment in RSA

•Post-acquisition integration strategy

•Effectiveness of Kentz business

development systems

Bespoke Cert/

Dip/ MSc

The new Master‟s track

Nottingham Trent University

Attributes Desired outcomes

A business-responsive

university

Corporate relationship

Nottingham Business School

clients include the BBC

Exposure to global issues

School of Architecture, Design &

Built Environment

Reputation

Action learning methodology Learning from practice

Kentz Group

Attributes Desired outcome

10,000 plus employees Develop leaders

Operational in 26 countries Engender knowledge of company, industry,

theory, practice

Rapid growth Sustain growth

Global opportunities Succession

Action learning - Curriculum design

Teams

Rethinking design

Quality objectives

Commercial Strategy Team

College Management Team

Academic & Standards Quality Committee

Validation (including input from externals)

Action learning pathways

• Induction

• Fundamentals of Business

• Project Leadership

Certificate in Management

• Strategy & Leadership

• Strategy in Action

• Team Consulting Project

Diploma in Management &

Leadership • Research Methods

• International Consulting Project

• Management Research Report

MSc (Management & Leadership)

Action learning – University-wide collaboration

• Collaboration around

resolving issues

• Supportive cross-

functional and cross-

organizational

environment

• Focus on achieving

goals

• Focus on learning

Kentz

School of Built

Env.

Business School

Action learning – Androgogy

• Democratises the learning

process

• Solves complex problems and

challenges

• Builds powerful teams

• Enhances corporate culture

• Develops leadership

competencies

• Promotes systems thinking and

creativity

(Adapted from Marquardt)

Learner

Set Adviser

Tutors

Team

(Sub-set)

Action Learning

Set

Corporate Sponsor

Colleagues at Work

Learning “Buddy”

Action learning – Motivating students

• Individual interest and

desires

• Motivation within the

team

• Impact of the

corporate client

• Impact of the learning

coach

• Impact of other peers

and colleagues

Action learning – Learner-centred learning

Academic

Organizational

Learner

Applying to corporate learners

• Engagement with live

issues

• No “right” answer

• “Messy learning

• Courage

• Broader engagement

• Problem-solvers

• Building networks

• Action-takers

Action Reflection

Practice Theory

Live issue

In conclusion

Kentz growth and international

reputation requires talent, and in

particular leaders, to be developed

at all levels in the company.

Action learning (supported by other

adult learning approaches)

provides the best method of

developing talent in Kentz.

Benefits have included the creation of

a talent pipeline to support

succession and deliver growth.

Key strategic and operational projects

have been important in the

organizational development of

Kentz.

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Your questions?

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