Addax Petroleum and Sinopec Show Managing Cultural Diversity to be a Worthwhile Investment

- Leadership - Nov 02, 2014

Few will deny the likely correlation between workforce happiness and productivity.

According to employee happiness research specialist Happiness Works, a business with contented workers will see a 10 percent drop in absenteeism, a 10 percent reduction in turnover rate and a five percent increase in productivity.

The Happiness at Work Survey is based on 12 years of research with the likes of the EU’s statistics office, Eurostat, the UK Office of National Statistics and the OECD, and concludes that happy employees will seriously boost a company’s bottom line.

In what seems like a win-win situation for company bosses and workers alike, programmes involving reward schemes, staff outings, internal competitions, exercise classes and the like are commonplace.

Perhaps less talked about in the multinational sphere is cultural diversity management, and the benefits to be gained from educating employees from different cultural backgrounds on each other’s value systems, encouraging dialogue and an open approach to difference which may otherwise have been left quiet and reduced to stereotype.

In an ever globalising world more and more businesses will encounter the need to properly integrate diversifying workforces, a move which is likely to pay sizable dividends.

From 1,100 to one million

With its main service office in Geneva, Switzerland, Addax Petroleum is an international oil and gas exploration and production company with strategic focus on Africa, Europe and the Middle East.

Bought by Sinopec in 2009 to provide a sound basis for sustainable growth, and for the Chinese giant to strengthen its upstream assets, Addax’s 1,100-employee operation became part of a one million-strong global heavyweight.  

Communications Director Marie Gabrielle Cajoly outlined the challenge this presented to Addax Petroleum in terms of maintaining its natural identity of a flexible and culturally diverse and integrated company.

“Before we were acquired by Sinopec we used to be an extremely agile exploration and production company,” she said. “We were already on an upward path and had achieved many milestones but the acquisition changed the scale and ambition of the business very quickly and in a fundamental way.”

“For Addax Petroleum cultural diversity was nothing new. We already had 33 nationalities in Geneva alone but the Chinese culture was new to us, both in terms of employees and shareholders, so we had to get to know and understand it and make adjustments.”

“Before we just took cultural diversity as a given. Now we are actively working on how best to manage and capitalise on our diversity – it is helping us integrate the companies and better work together and we are learning all the time.”

Following a managerial transition period until August of 2010, cultural diversity management officially kicked off in January 2011, and has not looked back since.

PEARL

Standing for People, Energy, Action, Results and Leadership, PEARL was formed with two key objectives – to enhance the understanding of and respect for all cultures encompassed by the company, namely African, Western and Chinese, and to develop a unified business culture across the board.

Cajoly, who spent three weeks at Sinopec’s management institute to learn more about Addax Petroleum’s new shareholder, added: “Neither Sinopec nor Addax Petroleum’s new Management had in mind that because the new shareholder was from China everybody had to learn Chinese and Chinese culture.

“The will of the company was really to preserve our culturally diverse DNA and therefore the motto was to build positive interaction with all cultures.”

The cultural awareness part of the programme is threefold, with Chinese employees enriching their understanding of Western and African cultures, and other workers reciprocating the process.

Various interactive workshops and conferences are run by third party experts in facilitating dialogue via inventive means such as theatre for example. In the case of the theatre workshops, employees wrote and played their own scripts based on their experiences with other of cultural differences, both on what they appreciated and what they found challenging.

Many different sessions are held in all company territories and clearly scheduled throughout the year; African culture is timetabled for September in Geneva for instance. If employees are absent they can register for alternative times. The aim is for everyone to be able to participate.

Alongside developing appreciation of the diversity among employees, Addax Petroleum conducted a cultural audit as part of its plan to harness a common business culture across the entire company.

Cajoly said: “We wanted to acknowledge the diversity but also build one single common business culture which any employee can relate to.

“The audit invited all employees to express their perceptions, understandings as well as misunderstandings, of the company culture and objectives, the challenges faced and so on. This was done as a 360-degree survey and will be repeated every three years.”

As a result a new corporate culture grew based on three core values: Integrity through Action, Harmony through Diversity and Value Creation through Excellence.

The bottom line

Part of the challenge associated with PEARL was to demonstrate that this cultural diversity management delivers a competitive advantage to Addax Petroleum, and feedback to date justifies its extensive investment.

As of April this year, 564 employees throughout the company have taken the Chinese culture programme, 337 have been trained on African culture and 431 on Western culture, with extremely high satisfaction recorded through feedback forms in all locations. The cultural audit averaged an 83 percent participation rate.

“People were sceptical at first, thinking they had better things to do, but in the end the only major criticism was that it should have happened earlier and that we should be doing more of it,” Cajoly said.

“Employees have said it has a direct and positive impact on their day to day work as they better understand their colleagues, going beyond common cultural assumptions.”

Cajoly is confident that the programme has had a major impact on the fact that Addax Petroleum’s staff turnover rate in Geneva has dropped from 19 percent to 10 percent between the 2010 post-acquisition peak and 2013.

The company remains truly multicultural, with 7-10 percent of the workforce being Chinese and more than 95 percent of staff in operating companies in Nigeria, Cameroon and Gabon being local nationals, including those at management level.

Going forward Addax Petroleum is looking to extend PEARL to include exhibitions of art, literature and film, building on the foundation already established.

Cajoly concluded: “It gives us an element of competitive advantage, for we are both integrated in local environments and united inside the company. It has enhanced our staff retention, improved government relations, helped maintain partnerships, and we believe ultimately benefitted our bottom line.”

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