Knowledge Network: Faculty & Research

Story and photos by Daryl James

New BP CEO Bob Dudley stepped into an “intercultural laboratory” when he temporarily resigned from the group in 2003 to lead TNK-BP, an independent oil company formed from a BP alliance with two Russian companies. “The partnerships we had at TNK-BP created something like an intercultural laboratory,” said Dudley, a 1979 graduate of Thunderbird School of Global Management in Glendale, Arizona. “It was a Thunderbird’s dream for managing something complex.”

The three TNK-BP partners each brought distinct corporate cultures to the mix, and relationships were often tense. Nevertheless, Dudley and his Russian oligarch partners made things work for about five years, and output rose from 1.3 million to 2 million barrels of oil per day.

Then a power struggle erupted in 2008 as oil prices spiked. Dudley declines to discuss much of what happened due to political sensitivities, but other sources describe an “intense campaign of harassment” against Dudley to force his resignation. He left Russia in July 2008 and stepped down as president and CEO of TNK-BP in December 2008.

Looking back on the episode three years later, Dudley sees a microcosm of the complex challenges many global leaders face in the 21st century. As the world grows increasingly inter-connected through trade, leaders of global organizations must navigate cross-cultural relationships that often span business, government and social sector boundaries.

Dudley shared global leadership insights July 14, 2011, in a one-one-one Thunderbird interview at BP offices in Houston, Texas. The conversation previews a keynote address Dudley will deliver Nov. 10, 2011, at the inaugural Thunderbird Global Business Dialogue in Arizona.

“Thunderbird is a great school to bring people together to think globally,” Dudley said. “You need people who can function with lots of ambiguity with lots of patience. And they have to listen and think about issues from all sides and find solutions.”

Dudley said the dialogue’s theme, “Redefining global leadership,” highlights the increasingly important need to manage complex, sustainable and productive relationships. “It comes down to people interacting with people,” he said.

Complex relationships

The oil and gas industry has managed complex relationships for decades in isolated, unstable regions from the Arctic to Central Africa. “Oil and gas creates a fascinating combination of business, technology and geopolitics,” Dudley said. But even within the industry, he has seen a shift in the 21st century.

“Oil and gas will have to adapt with everyone else,” he said. “Our industry seems to get more and more complex.”

He said people who thrive in these environments have a different global mindset that allows them to look at issues from multiple perspectives. As organizations develop global leaders, Dudley said they need to be mindful to choose the right assignments at the right time.

“Some of the places where we work around the world are not places for developmental assignments,” he said. “And there are some places that are.”

Sustainable relationships

The oil and gas industry also has focused for decades on building long-term relationships that survive shifting politics and attitudes.

“We make big, long-term bets that sometimes do not produce revenue for a decade,” Dudley said. “We have to think about developing a work force and a sustainable investment that can live — in some cases — through multiple changes of government. The only way you can do that is to step back and try not to get yourself too deeply involved in the politics of a country.”

He said organizations also need to make sure they create real value for shareholders, customers and communities. “Make sure you are contributing to a country,” he said. “Pay your taxes, develop local talent and give back to local communities.”

Productive relationships

Global leaders also must develop productive relationships, which means getting everyone to “row in the same direction.”

“This does not mean you’re all the same or that you have the same viewpoints,” Dudley said. “But everybody has got to have a level of trust. Otherwise it is very hard to move things forward.”

He said global leaders must become masters of communication . This is especially important in times of crisis. “A leader must communicate, communicate, communicate,” Dudley said.

>> Learn more: Advanced Management Program for Oil and Gas Industry Executives, a two-week certificate program taught at Thunderbird School of Global Management, Nov. 27-Dec. 9, 2011.

>> Related article: Five global trends keeping BP’s CEO awake at night

Bob Dudley ’79 accepts a Career Achievement Award from Thunderbird President Ángel Cabrera, Ph.D., during Homecoming in March 2009.	“How Now Green Cow,” a sculpture in the Parade of Cows series, stands outside BP offices in Houston, Texas. The sculpture’s inspiration came from BP employees, who submitted names for cows associated with BP and its core values. Artists include Marketing Plus and X Factor Design.
A wall of clocks marks different time zones at BP offices in Houston, Texas.	BP Group CEO Bob Dudley ’79 talks about his career July 14, 2011, at BP offices in Houston, Texas.
Thunderbird Corporate Learning director John Berndt, right, meets with Bob Dudley on July 14, 2011, at BP offices in Houston, Texas.	A BP worker leaves corporate offices July 14, 2011, in Houston, Texas.
BP Group CEO Bob Dudley ’79 will be a keynote speaker Nov. 10, 2011, during the Global Business Dialogue in Glendale, Arizona.	A BP office building towers above the trees at the corporate campus in Houston, Texas.

Posted: 08|1|11 at 8:01 am.
Filed under: Global Business Dialogue, Global Leadership.
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