VPHR Report

You are the Human Resources Director for a large petroleum refinery in Minnesota. The VP of HR is planning for an executive session with the CEO and other VP’s to develop the next 3-year strategic plan.

The major items facing the organization are as follows:

Approximately 80 of the company’s 1,000 employees are petroleum engineers. They are difficult to recruit, highly compensated, and key to the company’s success and sustainability. You have an immediate need for 15 additional petroleum engineers. Five percent of the current engineers are set to retire in the next 24-months. Your organization pays engineers at the industry midpoint for salaries.
The Board of Trustees wants to invest heavily into biodiesel and ethanol operations in the next three years.  The current labor force skillset crosses over from petroleum refining, but the current labor union opposes cross training unless incentives are offered. Incentives would be $10,000 annually per person willing to participate in job retraining. It is estimated that 25 employees will be needed to start work in 12-months, then another 25 employees once the facility becomes operational in approximately 24-months.
Three major environmental health and safety issues happened in the past 12-months. They are as follows:
o  One aboveground storage tank ruptured, causing a spill of 5,000 gallons of crude oil. Some of the crude oil made it to a neighboring property. The current remediation costs are at $200,000 and climbing.

o  An explosion in one of the process areas led to a worker fatality. Minnesota OSHA investigated and found violations of OSHA Lockout/Tagout rules and deficient training related to Minnesota AWAIR and Right-to-Know laws.  The company paid for the worker’s funeral. Repair costs have been completed. Fines have been paid. The total direct costs are at $125,000.

o  A former employee went to the local news outlet and gave a detailed account of how water samples to be sent to the Minnesota Pollution Control Agency for testing were inappropriately collected to show cleaner results. There are no direct costs known, but public perception is poor.

For your portfolio assignment, prepare a formal report to your VP that outlines all of the following questions:

1)  Staffing proposal for petroleum engineers to meet needs over the next 24-months. Your proposal should include industry data to prove the proposal’s competitiveness.

2)  Recommendation on whether or not new staff should be hired to fill biodiesel and ethanol positions, or if incentives should be offered to train current staff to meet foreseeable needs. Your recommendation should include a cost-benefit analysis.

3)  Recommendation on how to improve the current climate related to environmental health and safety. Your recommendation should include how you plan to gather current organizational climate measures and share behavior expectations of leaders and employees. Your recommendations for improvement should include costs of implementing new programming compared to direct and indirect costs of past incidents to justify your recommendation.

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