While the energy sector is undoubtedly changing before our eyes, there are plenty of ways oil and gas companies can develop a long-term plan to be successful despite these changes.

Demand for Renewable Energy

The desire for renewable energy is strong from a societal and governmental standpoint. People worldwide desire a move away from fossil fuels, and governments agree, putting in place new mandates to force companies to decarbonize.

This is a monumental undertaking, though, and one that will not happen overnight. As such, investors have a strong short-term outlook for oil companies.

Much of the surging prices of energy stocks is due to the rising prices of commodities. Many investors expect these prices to stay high for at least the next few years, which will appease companies in the industry.

Natural Gas as the Transition

In the meantime, natural gas is being viewed as a great transitory energy source between traditional fossil fuels and renewable energy counterparts. In many ways, it’s being seen as the bridge between, say, oil and solar power.

Many oil and gas companies are already working on this transition, shifting their focus slightly away from oil and toward more natural gas. While this may not be a long-term solution — as the true future of natural gas is uncertain — it’s certainly a strong strategy that many companies are adopting for the mid-term.

Creating Long-Term Value

How do traditional oil and gas companies fit in a renewable energy world? That’s the critical question that every company in the industry needs to answer for themselves if they want to remain viable.

A majority of investors believe oil demand will peak in roughly eight years. That may seem like plenty of time to develop an alternative business approach, but it’ll come quickly.

Keep in mind that a shift away from oil to renewable energies will be a multi-year undertaking for most companies. And when the demand for oil peaks, it’s possible that it will drop off exponentially each year.

Energy companies are already working to find their niche in a renewable world. The savvy ones are already making small transitions now. 

In addition to working to meet emissions reduction targets and investing in clean energy, they are also focusing heavily on carbon offsets to play a part in decarbonization.

Recognizing the Change

There is no set blueprint that oil and gas companies should take to respond to the changing world around them. No one knows for sure exactly what the future holds for the industry.

That’s why, as Ferrari Energy explains, oil and gas companies must recognize and accept that change is not just coming; it’s already here. Then, come up with ideas for responding to the change.

It may take a lot of ideas trial and error to see what sticks. So, starting now, if you haven’t already, it will be critical to the future success of oil and gas companies.

About Ferrari Energy

Ferrari Energy, founded by Adam Ferrari, is a family-owned private oil and gas company focused on mineral and leasehold acquisitions. Founded in Denver, CO, with a focus on educating landowners, Ferrari Energy has consistently served the needs of the landowner community in the basins in which it works. Its operation covers several areas throughout Colorado, Wyoming, Utah, and ND. Ferrari Energy has provided oil and gas leases to over 850 homeowners and held multiple lease signing events to accommodate the residents of Broomfield, Colorado.

Innovation is critical to your company. It is the process whereby your teams conceive new products, creative services, and better ways of doing things. Innovation is also the process by which you can solve your most challenging business problems. Without innovative ideas, your business will stagnate as competitors leave you behind. 

To create a unified problem-solving team does not mean that everyone on the team is the same. Diversity among the team members is crucial and a strength that can help companies make better decisions and be more productive and innovative. 

A diverse workforce inherently provides new perspectives and distinct experiences—the fuel of innovation. Business leaders that see diversity and unity as incompatible opposites are missing an important principle—your business teams can never achieve unity by ignoring and isolating members of your team who seem to be different. 

Unity, when problem-solving, is undoubtedly a desirable and achievable goal, but it should not be subtractive in that we disregard the significance of our differences. Unity should always be additive as we strive to understand, appreciate, and integrate diverse skills, life experiences, and points of view. 

What do unity, diversity, and innovation have to do with T-shapes and Jigsaws? Everything. Let’s unpack these ideas and see how they work together.  

You can best understand and teach others the concept of T-shaped skills by visualizing a large capital letter “T.” The vertical aspect of the shape represents an employee’s or job candidate’s core strengths—the skills and abilities for which you hired or are considering them. If you’re trying to hire a computer programmer, for example, the vertical part of the T represents their ability to write code. You’ll want someone with the knowledge and experience needed to do their job, but don’t stop there. 

The horizontal part of the letter T in our metaphor represents the candidate’s ability to collaborate across disciplines, communicate, and work well with others. Our hypothetical programmer could be a whiz at coding. Still, if they cannot accept input from other team members, engage in critical thinking, and express their ideas clearly, they might not contribute to the innovation you need. 

When creating a problem-solving group in which innovation can flourish, the final component is deploying a cooperative method called a Jigsaw strategy. Like pieces of a puzzle, each one is necessary. The team needs input from diverse perspectives. This strategy enables team members to contribute their core strengths (the vertical part of their T-shaped skills) to help find a solution to a business problem. 

Within Jigsaw teams, members rely on their collaboration and communication abilities (the horizontal part of their T-shaped skills) to determine how their core strengths can contribute to an innovative solution. Our programmer can see solutions that team members from other departments with other core strengths could never envision. And likewise, the other team members will offer different valuable ideas. 

As a business leader, your job is to see over the horizon and identify potential problems. As you do, suppress the temptation to prescribe a solution single-handedly. Instead, assemble Jigsaw teams composed of a diverse set of employees that have demonstrated solid T-shaped skills. This group will deliver possible solutions that you could not formulate alone. 

About Adam Ferrari

Adam Ferrari was born and raised in the south suburbs of Chicago, IL. He is the grandson of an Italian immigrant coal miner who worked in the mines of Coal City, IL. From an early age, Adam was taught the value and dignity achieved through a hard day’s work. The oil and gas industry provides good-paying jobs for millions of blue-collar men and women across America. This is one of many reasons Adam and his company, Ferrari Energy, are such staunch supporters of the oil and gas industry. Blue-collar men and women built America, and the modern oil and gas industry keeps America moving forward.

Ferrari Energy, a prominent mineral acquisitions company, has distinct roles in the company that fall under either management or leadership. There are distinct and separate responsibilities for each position, and Ferrari Energy outlines the essential differences below.

What is management?

Management is the type of position that works with other people to ensure that a company’s goals are communicated and executed. Managers hold specific responsibilities as members of an organization. Certain traits managers possess include the ability to achieve a vision, direct, process management, and look after and cater to the people they manage. Great managers can develop strategic ideas and break them down to a level that their team can clearly understand. Managers also have the capability within a company to establish work protocols, standards, rules, and processes.

What is leadership?

Leadership focuses more on being the architect for what goals should exist, generating value, and driving change. Practicing leadership pushes individuals to learn how to let go, trust others will do what is right and ethical, and embody working at all levels of an organization to empower others. Leaders do not exactly occupy any type of management position. The specific traits that a leader carries include the skill of creating a vision, living out characteristics of honesty and integrity, inspiring and helping others to understand their purpose, and practicing effective communication skills.

In a parallel comparison, what are the main differences between managers and leaders?

There are multiple differences between managers and leaders that make their roles specific to their parts in an organization. A manager tends to tell others what to do to reach a goal, while a leader comes up with innovative ideas and sells the idea, so others want to be a part of bringing that idea to life. When moving a team in a specific direction, managers plan the details through strategies such as memos and set meeting times. On the other hand, a leader will set the tone and team towards a specific direction by gathering a team to share some exciting information.

Managers are held accountable for ensuring that organizational goals are being met, so minimizing risks means better outcomes. Risks are intended to be taken for a leader because the payoff will make up for the thin stretch. A manager uses objectives to make a plan and work a plan as quickly and time-efficient as possible. A leader has a vision and bases his operation off of a vision while incorporating a team’s new ideas along the way. When you picture a manager, they are more of a giver of instructions than a leader who is a giver of encouragement. Management is more of a job description that pays an individual to oversee a group of people. In contrast, leadership exemplifies through an ability to positively push others as a group in the direction of success.

About Ferrari Energy

Ferrari Energy was founded in February of 2014 in Denver, Colorado, and completely bootstrapped by Adam Ferrari. Since then, Ferrari Energy has grown and conducted business across the United States, in Colorado, Wyoming, Utah, and North Dakota. Its portfolio includes more than 2,500 unique acquisitions that accounted for over $150 million of deployed capital. The acquisitions included minerals on non-operated leasehold, and all the company’s clients consistently received premium value for their transactions.