Strategies to confront rising demand and climate threats
The four building blocks of transformation offer a means to ensure that the vision for the industry’s future is ambitious and aspirational, and that it actually delivers on its promise.
The demand for energy is far outstripping the rise in global population. At the same time, the world is striving to tackle the issue of climate change by mitigating carbon use. The relationship between these two dynamics — the rise in demand and the recognition of climate threats — will define the strategic choices for the energy, utilities and resources industry.
There are four factors that are changing the dynamics in energy, utilities and resources:
The challenges of demand and conservation apply to a wide range of companies: producers of all forms of energy; disseminators and sellers of electric power, gas, and oil; energy-based process industries like chemicals and steel; and producers of other extracted commodities. All of them will need the acumen to make and execute decisions that combine growth with environmental sustainability, often in new ways.
The specific vision for transformation will be different for every company operating in the energy, utilities and resources industries. Steps, stages and organisational designs will vary from one enterprise to the next. There is no blueprint for corporate transformation, but there are four basic building blocks that we find in any successful transformation. They are:
1. Create a strategic identity
Articulate a single desirable future for your enterprise and focus all your efforts on achieving it.
2. Design for trust
Develop ways to attract and deserve the commitment of everyone related to your enterprise — particularly customers and employees.
3. Master the pivot from sprint to scale
Test new practices in an intensive, experimental, startup-style manner. Pick the approaches that work, and rapidly implement them throughout the larger system.
4. Treat your legacy as an asset
Save the best of your past, divest the rest for advantage and use the income to fund the future.
Global Leader, Oil and Gas, Partner, PwC United States
Dr. Nils Naujok
Global Leader, Chemicals, Partner, Strategy& Germany