So You Want to Be Chairman of Exxon?
Or maybe you don’t.
(Page 3 of 5)
Once at Exxon, a young professional immediately comes under an intensive and complex system of evaluation. Once a year each manager in the company rates all the employees under him (anywhere from 25 to 70 people) on a one-to-five scale. One is for water-walkers, a 2.5 means you’re above average; and a 5 means termination, although, as one employee puts it, “you’d have to assassinate somebody to get a five.” There is a forced distribution system for the ratings, so that only a small percentage of the company’s employees can get ratings of one. Each manager also does what’s called a seriatim listing of the employees under him—a ranking, in numerical order, according to performance. And these numbers are reviewed by more than one supervisor. As a result, Exxon avoids some of the problems endemic to other bureaucratic personnel evaluation systems. In the Army, for instance, an officer’s career depends completely on the Officer Efficiency Report he gets from his supervisor, and these are only nominally checked by others. So, much more than Exxon employees, Army officers talk about there being an ironclad rule that, no matter what, you don’t piss off the boss. Another problem in the Army and many other bureaucracies is grade inflation: there’s no reason for a supervisor not to give out lots of very high ratings, thus rendering them nearly meaningless. But at Exxon, the forced distribution system prevents that.
Supervisors also fill out more detailed forms on employees, evaluating their performance and suggesting areas for improvement. And each employee fills out a form on himself, saying how he thinks he is doing and what his goals are. With those in hand, employee and supervisor meet face to face and discuss their findings. This is the only part of the whole evaluation process that many employees know about, and, depending on the boss, the performance review sessions may be a healthy exchange of views or completely pro forma. “Often my boss would tell me what he said on the form, and I’d just say yessir, yessir, yessir and sign it,” says one former employee.
The last and most important step in the process is a rating of potential that managers give their employees. At Exxon, as in the civil service, people move up through a series of numbered grades, with pay tied to the grade. A college graduate in a professional job will usually start as a 22. Above the numbers is a second series of lettered grades leading all the way to the top. So if you’re a 22 now but show a good deal of ability, your boss might list your potential as 29. If you get a 31 or 32 or are judged to have the potential to “go into the letters,” then you have a good chance of becoming a “hi-po,” a member of a special high-potential group.
Upper management in each department culls all the evaluation reports and picks out the employees who seem to have high potential. These people are divided into two groups—those with just plain high potential and those with extra-high potential, the ability to become a corporate officer one day. Of the 28,000 employees of Exxon USA, several hundred might be in the first of these groups and as few as 25 in the second. The hi-pos get a great deal of attention from management. At Exxon USA, each hi-po has a special four-year development plan, and his progress is regularly reviewed by a group whose members include the president of the company, Randall Meyer. Even at the pinnacle of Exxon Corporation in New York, the employee members of the board (who make up an “inside board” that meets more frequently than the regular board) spend much of their time talking about where to move particularly promising employees.
You are never told straight out that you are on this fast track, but you can tell. You get paid in the upper end of the scale for your grade. You get promoted rapidly. You switch jobs a lot. In the elevator, vice presidents whom you’ve never met greet you by name. For every significant job at Exxon there is a replacement list—a roster of possible replacements for the job’s present holder. Fast-track people, who tend to be on these lists, get the jobs when they open up. People are chosen for the fast track very young—often in their first five or six years with the company, almost never after age 35. That means their intelligence and ability are more important than their specific experience in winning them a rendezvous with destiny. Where management chooses to steer the fast-track people shows what experience it thinks its top executives need to have, and, by extension, what it considers most important to the continued prosperity of the company.
A typical fast-track career might go like this: after graduation with a BS and an MBA, your first job would be with Exxon USA, somewhere in the field—either at a district office near drilling sites or at a refinery. Exxon has myriad divisions and specialties, but, in broad outline, the most important kinds of work are exploration and production (“upstream”), and transportation, refining, and marketing (“downstream”). Of these, the most reliable producers of top executives—and, therefore, in the company’s mind, evidently its most important functions—are production and refining. Of Exxon’s many companies, the main supplier of talent for the corporation is Exxon USA. It is the work of drilling for and refining oil and gas that is at the center of what Exxon does (more so, interestingly, than finding the oil), so that’s what the company rewards. More than anything else, it is in the business of efficiently processing vast quantities of its product.
After the initial field job might come a tour back at headquarters in a staff job, doing financial analysis and planning. Field jobs are the meat and potatoes of the company, and it is important to show that you can meet a production schedule, stay within a budget, and meet deadlines. But when any organization becomes large, staff work is also crucial, and a staff job provides the opportunity to learn the skills of the office, to meet executives, to make presentations to important people, to make yourself well known. Following the first headquarters job might be a second tour in the field, this time in a supervisory capacity. All during this time, in addition to doing your work, you will attend company training courses, both in the techniques of your field and in broader skills, like public speaking or negotiating. It’s good for Exxon that Clifton Garvin is impressive in congressional hearings, on television, and at annual meetings, and the courses he took are one reason why he is.
After five or six years in his specialty, an employee on the fast track might spend another four or five years moving through staff and supervisory jobs in other specialties. The idea behind this is that a really good manager has to learn how to manage anything, even if he doesn’t have any expertise in it. Often a promising middle manager trained in chemical engineering will find himself challenged by being put in charge of a unit in, say, land management, whose work he barely understands, supervising people who have the expertise he lacks. At this point, a rising employee might attend a company course in the techniques of management.
After some time in another field it is important to get back to your original specialty, whether it was geophysics or accounting (to move on to another new one can be fatal), but in a position of real responsibility. In the field, the hierarchy of such jobs would be coordinator, then district manager, then division manager, and finally operations manger. In production, for instance, a district manager might run everything out of the Corpus Christi office; a division manager might be in charge of all production in the central United States; and an operations manager would oversee all domestic production. Interspersed with these field jobs would be more time back at headquarters, ideally as assistant to some very high-level official. If all these hurdles are cleared, the next step would be a vice presidency and then a whirlwind of executive vice presidencies, executive assistantships, and presidencies of minor Exxon companies. As an example of the relative status of such jobs, a few months ago the president of Exxon Pipeline was promoted to the position of executive assistant to Exxon Corporation’s president, Howard Kauffmann. Schooling during this final polishing period might take place outside the company at a special course at some prestigious university—for instance, Harvard Business School’s thirteen-week advanced management program. At the end of the road would come a place on the board in New York.
My Library
