"That’s not just a risk, its real"

Executive Vice President of External Communications, Royal Dutch Shell

More than the traditional 100 days have passed since you started as executive vice president of external communications at Royal Dutch Shell. How does it feel to work for a company with around 100,000 employees, in comparison to a company such as your previous employer, SAP, with less than 50,000 employees?

Actually, I’m afraid the numbers are not up to date. The figure for Shell is, but I think SAP has now about up to 80,000 employees. They pulled off some acquisitions. I think this is not a big difference – I think the big difference is clearly the industries. The IT industry, which I would say until today, is not supposed to have any real issues, and then the energy industry where I think running into issues is unavoidable. That is probably the biggest difference compared to my last employer.

What is it like for a German to work in an environment that is traditionally Anglo-Dutch?

The Hague has a very international flair. Shell, talking about my team and overall, is a company that has very successfully developed truly international careers. Diversity is one of Shell’s major fundamentals to the way we work. Shell has very divers teams, in terms of geography and function and this means our workforce is likewise diverse, not only in gender, but in every possible way. In my team I am surrounded by people who have worked in far more different locations around the world than I ever did. The other amazing thing is that they have been working for Shell for 10, 20 and sometimes 30 years, so this seems to be a company that can attract and keep talent, but then make sure that this talent really develops its skills in the global environment the company is operating in, and therefore nationalities are of interest but they don’t matter.

Do the different nationalities of the team members still play a role in times of globalisation and internationalisation?

Interestingly enough, my experience is that if someone has only developed experiences within his national place of birth, then unfortunately nationalities do matter. My experience is that people – and I want to stress the word ‘worked’ as I’m not talking about tourism – need to work elsewhere to really understand what it means to be as a national in such a place. You also start to see value in the different aspects that people from across the world bring to the table, and so I think that nationalities do matter. If you only have experiences within one country, with one nationality, that is a disadvantage to operate in an environment where everything is international and globalised. Working all over the world, getting to know people, different cultures and languages and broadening horizons, that allows you to put yourself into the shoes of others to develop a higher appreciation and understanding of the diversity that naturally exists in business. We are very eager to allow each and everybody to develop these kind of international experiences, if they do not exist. That mainly applies to the juniors, because as I said anybody senior at Shell has an impressive track record of international experience all around the world.

How important are roots of a particular nationality for big companies in times of uncertainty as we face them today?

They always matter and are crucial, and I think it’s dangerous to ignore them or to neglect them. I think in the case of SAP it was always interesting for me to experience that, while we were rooted in Germany, we were kind of the exception in that industry because everybody else, each competitor, was an American company. All the influences mainly came from American publications or individuals. With regards to Shell, that’s a different picture, because there’s not one single determining market but there is the fact that the future demand of energy comes from places in this world where it is very obvious that there this strong future growth and a severe degree of energy poverty – that is in the East, in Asia and in Africa. So therefore Shell’s and everybody else’s strategy in this industry is more pointing towards the East in places like Asia, Australia and Africa. That is also what we need to keep in mind when we build our reputation and branding programmes here. Nevertheless, you will never lose sight of where your roots are because this is something that determines you. If you are aware of this and can put this into the right perspective, then it’s not a problem.

What is particularly British what particularly Dutch in Shell? After all, the merger of the British and the Dutch parts of the company took place more than 100 years ago.

You could say the operating language is clearly determined by the British, but that would be unfair – a reflection of the fact that English is the global language of business. Anyhow, I did a Dutch language course just to be in a position that I can read and understand Dutch newspapers and my Dutch colleagues, which was a luxury that was not needed for my job here. The Dutch component that I experienced – what I like about my Dutch friends – is that they are so frank and outspoken and they don’t talk around – they address things to the point which allows you to very quickly get to the essence of the problem and look for a solution, and you don’t have to waste too many words. I think the Dutch are even more direct in that regard than the Germans. Not everybody knows how to deal with it, but for my taste it is justified because its highly effective and I think this is an interesting breed of British and Dutch. Nevertheless Shell Headquarters in The Hague is a very multicultural and diverse community, where over 70 nationalities are working very well together.

What was your most striking experience in those early months in this position?

The most striking experience partly explains why I decided to take some more time than I initially expected I would need in order to familiarise myself. I am a chemical engineer by education and when I arrived for the first time at one of our refineries somebody showed me around. He was pretty surprised that I headed for the technical questions because he didn’t expect a communications person to come up with these questions. Nevertheless, I misguided myself because as an engineer you see everything as a closed loop process: somebody has to find the oil, bring it to the surface, process it to the product, send it to market and that’s the theoretical process. In practice, this company consists of two important parts: one, solely responsible for finding gas and oil and bringing it to the surface, and the other to buy crude oil or gas from the market and turn this into a product and sell it to the consumers. And the product connect between these two streams is probably a relative small proportion of the materials that Shell finds end up in Shell’s retail space, because in-between there’s a super-efficient market which works perfectly as a buffer to sell excess materials on the one side, and to buy – very much driven by the demand and not the production. That’s why the upstream and the downstream business, as it’s called internally, are somewhat independent parts of the company, but glued together by one of the strongest brands in the world. That was one of the first surprises that I found here.

What were the first steps you took in the past four and a half months?

I spent the first weeks making myself familiar with Shell’s business. In the Netherlands and the UK, there are so many installations that I could experience each and every part of Shell’s portfolio here in the Netherlands, and in doing so also get an idea of how diverse the stakeholder responses are and can be in just one country. That was very helpful for me to get an idea of what kind of issues and in what kind of way Shell is dealing with on the ground. Then certainly, I made myself familiar with my leadership team, the team itself, where they stand today, the resources that I have and at the same time also engage in discussions with the different members of the executive committee to understand what their expectation is towards the future. At the end of this I put all these pieces together.

What impression of Shell did you get?

In a nutshell, what I found is that Shell, and the vast majority of my resources, are doing a really good job on the ground, the frontline communication, the local stakeholder engagement to ease our operations, to make sure that we get the permits we need to operate, that the stakeholders who are affected by operations understand us and know how to engage with us. I think that’s where Shell is really world-class. The problem is that there are a few major areas I would describe as issues we have to deal with that are very specific to the oil and gas industry. But only if people understand that this planet on its way to the future and energy future in the meantime has an even rapidly growing hunger for more energy will they understand that we have no choice than go for each and every hydrocarbon we can responsibly find to supply this. These challenges are so big, that the vast majority of Shell’s communications activities, aside from the on the ground ones, are absorbed by dealing with these issues. There are so many untold great and good stories to tell about Shell, we need to focus on and simplify the complex stories so everybody, internally and externally, will be able to understand it.

At SAP, I dare say you didn’t need to worry too much about crises coming along your way. This might be different at Shell now, less people will like your new employer. What has been your personal perception of the energy industry before you joined the sector?

As a chemical engineer I probably did not have the average perception of the energy sector because I did understand how crucial energy, and particularly for the next decade fossil fuel-based energy, will be in order to maintain the economy we have created and are living in, and to allow others on this planet to also benefit from this. I also understood that technology is there to solve problems, it is not the source of problems, and that means that all the negative consequences of this are addressable and there are also technical solutions for them to address them. So, in that regard I am probably not a good representative, and the good thing is that I’m aware of this so I don’t expect anybody else to think or believe like I do. I think what I realised very quickly is that it would take you and I 30 seconds to de-position anything that Shell is doing because it can so easily and quickly be used to serve the usual preoccupations that you find here. On the flip side it takes me 30 minutes to explain to you and anybody else that this is not the case and why, and that is a big disadvantage. But it describes the challenge that the communications department at Shell is dealing with. It is therefore important to put really correct programmes in place that hopefully find ways to scale and shortcut these 30 minutes or make it more difficult for somebody else to de-position what this company is doing. 

Your competitor, British-American oil-giant BP, has gone through some difficult times recently, if I may put it that euphemistically. How has the Deepwater Horizon Crises impacted on Royal Dutch Shell?

It’s obvious that BP has an interest to describe what happened as an industry problem, and it’s up to the authorities to finally decide on this. We strongly disagree with this, because we think that this incident was avoidable. But we will await the outcome of the President report into the tragedy early next year, so we will know what really happened on this rig. Shell is investing heavily into the prevention of these kind of things, and that’s why we most likely would not had drilled that well this way. I think the advantage is that now everybody is an expert in deepwater drilling and I can use these terms and don’t have to explain them as everybody knows what I’m talking about. The disadvantage is that clearly this individual incident has created the false impression that this technology is generally not controllable.

What would you say could have been the biggest risk for BP’s competitors in the course of the Deepwater Horizon crisis?

That’s not just a risk, its real. I mean the whole industry is now in a descent mode here because the public is questioning the feasibility of these deepwater activities and therefore I think the result, whatever the outcome will be of this crisis, will affect the whole industry. I think what I can say for Shell is that if the result is a more universal high standard for safety in deepwater drilling then this is something which we will appreciate and support because that is actually reflecting what we are doing anyway today.

BP’s then-CEO Tony Hayward was massively criticised for his crisis management and public appearances. When you started at SAP you were responsible for the company’s CEO communications. Would you say that a CEO’s life has become harder in the past couple of years, perhaps last decade?

Yes, absolutely. But in this regard I want to be fair. I think that when the crisis happened and I watched BP’s action I actually mentioned to team members that I think initially they followed the schoolbooks of crisis communication. I found in the first week that their action was really probably what everybody would have advised them to do.

What was their problem then?

I think after a week it started to become a 24/7 live interrogation by CNN and, reputation-wise, no one in the world can survive such kind of an exercise. Outside, we’re all smarter, so I don’t want to put blame on BP’s communication here because I think they discovered a couple of things that we can all learn from. One is that the CEO does have to show face and take responsibility when and where this is appropriate, but it’s not a good use of the CEO to have him being the crisis spokesperson 24/7 on TV. The other thing I think which we all watched and are now drawing conclusions from is that this is the first crisis under the surveillance of the so-called new or social media. I’m sure nobody would have been truly prepared for this. Look at the success of the fake Twitter account and Anti-BP Facebook pages. That taught all of us a lesson that you’d better build and engage these communities today when you don’t have a crisis, because when this kinds of situation occurs it’s too late and then you have zero ability to insert yourself into the conversation. That means you give others the opportunity to de-position you or position themselves, and that is not what you want. So I think everybody who is analysing what  happened will come to the conclusion that there needs to be substantial uplift in the industry’s ability to engage

Why has life for CEOs become harder? 

Wherever they show up, whatever they say, there’s no such thing as a closed circle. The smallest comment can immediately be made visible around the world, so easily put out of context and there are so many who could jump on this using this for their own purposes because its just so highly visible and so attractive to have something about the CEO of a large corporation. Just look at what is happening right now in Silicon Valley with HP, it is very easy to make this juicy and therefore get lots of attention. I think you can only raise the awareness of CEOs that every day is getting more risky, but I guess most of them are aware of this.

What would you say is the most valuable asset a CEO today needs to survive a public storm? 

Authenticity. Just to be and say and do what you believe in, and don’t try to pretend something that is not backed by your action, that is not reflected in what you are saying or doing elsewhere I think is the toughest and easiest recipe that I have to offer.

And does Peter Voser, Shell’s CEO, possess this asset?

I’ve only seen a few CEOs that have this high degree of authenticity. He is very real, he knows the business in detail and knows what is going on in the corporation, I am really impressed about what I have seen in this context with Peter and his leadership team.

Having started your professional career as a chemical engineer, would you have ever imagined spending your life working in PR, heading the communications department of one of the world’s biggest companies?

No. I am not a believer in career planning. My advice to everybody, starting with my own four children, is ask yourself what you really enjoy doing and look for a way to spend your time with things you enjoy, then there is a high likelihood that you will be successful. If you are successful, then such things like a career happen automatically; if you follow your heart, your brain will follow automatically. Doing it the other way around appears to be much tougher than taking this route. I’m in this position that I never expected to be in but I enjoy it very much and that is exactly what I was looking for.

Herbert Heitmann

Before founding his communications strategy consultancy Karaktero, Dr Herbert Heitmann was most recently Founding Chairman of BoldT, a consultancy firm which he co-founded together with Ex-Burson-Marsteller EMEA CEO Jeremy Galbraith. Prior to that, he was Executive Vice President of Global Brand, Communications and Government Relations at life sciences company Bayer (2013-2016). Other previous roles include Executive Vice President of external Communications at oil and gas company Shell (2010-2103) and Chief Communications Officer at business software leader SAP (1998-2010).  Dr. Heitmann is also President of the European Association of Communication Directors (EACD), which he co-founded in 2006. Other active roles include Partner at LiveTube Ltd, a curated live-news platform, and Member of the Board of Trustees at Arthur W. Page Society, the leading American communicators network. He began his career as engineer and scientist, in areas of gold-mining and disposable diapers, nuclear and environmental research.