www.eni.it

Demographic Change and Competencies in the European Gas sector: ensuring quality and security the challenge – Eni Gas & Power’s experience

Bruxelles, November 4th 2009

2

Contents

What knowledge management for Eni G&P is – a quick overview

A survey on Eni G&P’s knowledge (2007) Knowledge management model (2008) Knowledge protection and transfer – “Knowledge owners”

Training plans – some examples

Retail sales workforce training plan (2007) Salesforce revamping (2009) Another training program agreed between unions & company (2008)

3

A survey on Eni G&P’s knowledge (2007) - Outcomes

End of "one-nation centric" approach to commodity businesses l.t.

Dynamic portfolio management and flexible contracting tools, due to more volatile markets l.t. & s.t

Producers compete in strategic markets l.t. & s.t

Margin reduction related to a stronger position of producers in negotiations l.t. & s.t

Rise of short term markets l.t.

Risk management through financial tools l.t.

Rising demand of gas l.t.

Competition in LNG purchasing l.t. & s.t

Gas quantity available in the markets higher than demand s.t.

Unbundling Unbundling of transport, distribution and storage from sales business s.t.

Integrated offer Joint offer of Gas, Power and related services l.t. & s.t

Long distances between production sites and marketplaces l.t. & s.t

Gas transport by submarine lines on long distances l.t. & s.t

High capacity LNG trasports l.t. & s.t

Development of alternative and renewable sources of energy l.t. & s.t

Gas demand

Gas & power business development

Technical activities

Internationalisation

Disintermediation

"Financiarisation"

4

A survey on Eni G&P’s knowledge (2007) - Outcomes

Internationalisation

Disintermediation

"Financiarisation"

Gas demand

Unbundling

Integrated offer

Technical activities

Critical knowledge

Knowledge to develop

Systems and techniques of gas transport (pipe and lng): dispatching, nomination...Knowledge of European and Asian markets features, international-scale offeringInternationalisation - deeper knowledge of structure and features of target-countriesOrganisation of salesforce in target countries and development of trading operational modelsGas and power convergence: cross-commodity dynamics European market of labour and new recruiting systemsBuilding and management of high pressure and offshore long distance pipesBuilding and management of LNG plantsLNG shipping management"Financiarisation": knowledge of merchant/trading combined modelKnowledge of financial markets in order to appraise M&A and competitors' strategiesKnowledge of the financial "fundamentals" of the industry: relations between gas, oil and other productsTechnical and analytic competences on prices, costs, margins, etc.Cost attribution, offering processes and methods, contractsProject Management and economic analysis of integrated purchase/sale programsSensitivity to market signalsKnowledge of regulatory dynamics

Knowledge under change

Regulatory systems: from specialistic to basic knowledgeMass Market: from direct to indirect channels managementGovernance: shift to focus on partnershipHR management: integration between a national and international approachContracts schemes: deeper understanding of tools for purchasing of commodities and servicesPortfolio development: from long term to short term analysis and forecasting

5

in collaboration with HR - ICT Role: mapping critical knowledge building and updating Area Professional Models planning and executing training, development and

mobility programs (in cooperation with HR) managing Knowledge Management Systems Area Knowledge

Coordinator

in collaboration with HR

Eni G&P’s COO

Professional area

Professional Community

Community of Practice

Role: keeping business knowledge up-to-date and

diffusing knowledge through the company

Chief Knowledge Officer

Role: coordination of business specific KMS

Role: integrator of knowledge management systems Eni Eni’s KM

committee

Knowledge management model (2008) - Roles

6

Professional Area

Critical knowledge Knowledge Management Sys.

Community of practice

Gas Transport

Gas Transport via pipeline

LNG

Dispatching and measurement

Professional model

Risk Management

Regulatory Systems

Risk Management

Offer structuring

Sales (large customers)

Gas & Power integrated sales

Knowledge management model (2008) - Plan

Check/evaluation grid

7

Professional Area

Critical knowledge

Sales (mass market)

National and international market features

Customer care (billing and contact center)

Sales (international market)

Supply system

Knowledge management model (2008) - Plan

International market features

Supply

Etc.

Knowledge Management Sys.

Community of practice

Professional model

Shipping

Check/evaluation grid

8

Market

knowledge

Commercial

Skills

Economics /

Finance

Organisation

Cost

Management

Knowledge management model (2008) – Training needs

What’s there and what’s not there: 5 knowledge areas to strengthen

9

1. Market knowledge: market peculiarities and most critical processes (i.e. LNG) 2. Commercial skills: sales management and improved offering 3. Economics/Finance: financial markets, commodity market dynamics and competition 4. Organisation: organisational integration and communication flows 5. Cost Management: business control and cost attribution

Knowledge management model (2008) – Training needs

What’s there and what’s not there: 5 knowledge areas to strengthen

10

Knowledge Owners - Definition

Knowledge protection and transfer

Profile Highly skilled, non managerial profile He/she possesses a know-how extremely relevant for the business His/her professional authority is well known inside and outside the

company He/she is more than 40 years old His/her knowledge needs long time to be reached and is extremely

uneasy to find both in the internal and in the external mkt. of labour His/her knowledge is crucial to support Eni’s strategic goals

“Professional authority” marks

Being a practice community leader Holding patents or being author of scientific publications Taking part at conferences as Eni’s representative Taking part in national or international technical committees

Treatment

Peculiar and distinctive from other professionals

11

01

02

03

04

06

07

05

INITIATIVE General topics General topics Business specific Business specific

Profession specific

Profession specific

Individuals Individuals

Knowledge, talents and organisational

excellence

Knowledge, talents and organisational

excellence

Integrative leadership Integrative leadership

Age diversity Age diversity

Transfer and development of

knowledge

Transfer and development of

knowledge

Workshops Workshops Workshops Workshops Workshops Workshops

Innov-Action Innov-Action Innov-Action Innov-Action

Technical and specialistic seminaries

Technical and specialistic seminaries

Mentorship projects Mentorship projects

Team/Light coaching Team/Light coaching

Training initiatives for Knowledge Owner Training initiatives carried on by Knowledge Owner

Facilitator-supported projects

Knowledge protection and transfer – initiatives

Knowledge Owners – Learning themselves

12

Teacher Knowledge area Workshop theme

ROBERTO GREGORI Supply Market Intelligence “The role of transit Countries in gas supply security – towards new “gas wars”?

PIETRO ZARCONE Credit Management Commercial credit and management tools

ARRIGO VIENNA LNG Projects and Technical Services

Competition & technology: the case of LNG

Knowledge protection and transfer - initiatives

Workshops held by Eni G&P’s Knowledge Owners in 2009

Knowledge Owners – Teaching others

13

Retail sales workforce training plan (2007)

Market urgencies Competition Regulatory frame

Eni’s response Launch of new offers (power and dual) Active defense and customer base growth Quality of service enhancement

14

Eni G&P Retail business

Efficiency programs

Efficiency programs

Acquisitions Acquisitions

Power sales development

Power sales development

Contact Center service

enhancement

Contact Center service

enhancement Contact channel

optimisation Contact channel

optimisation

CRM & Billing Platforms

CRM & Billing Platforms

Efficienza e sistemi abilitanti

Retail sales workforce training plan (2007)

Factors that affect RSW

training needs

Drivers of change

15

Nov. 07 Oct. 07 Sep. 07 Aug. 07 July 07

Tra

inin

g on

par

ticu

lar

topi

cs

Billing/Metering

Credit mgt.

Mass Market Operations

Auditing & checks

Agencies mgt.

Franchising mgt.

Customer Care

Gas market

Power selling features

Knowledge diffusion

Grievances Power

Retail sales workforce training plan (2007)

Training on general topics strategic drivers and scenario regulatory frame evolution introduction to power market new commercial model

16

People involved: 414

Total

Training plan outcomes

Nr. of editions

370

Attendances Hrs.

7

15

3

5

74

35

46

1480

560

776

1840

89 2728

3 23 920

647 8304

Billing/Metering

Credit Mgt.

Mass Market Operations

Auditing & checks

Agencies mgt.

Franchising mgt.

Customer Care

Training on general topics

Retail sales workforce training plan (2007)

17

Salesforce revamping (2009)

Market segment features higher sensitivity to quality of services increase in competitive pressure etc.

Business strategies increase in gas sales strengthening of competitive positioning on power sales etc.

A new role for middle-volume customers salesforce to acquire new customers to improve Eni G&P’s “feeling” of the market to promote new commercial initiatives to act in a complex organisation to respond to more demanding customers

18

Sketch of required professional profile

1 HR

+ Line + Eni Corp. Univ.ty

Assessment process

2 Eni Corp. Univ.ty

Feedback

3 Eni Corp. Univ.ty

Training plan

4 HR

+ Line + Eni Corp. Univ.ty

Salesforce revamping (2009)

19

4 complementary tools to guarantee a multiple-sources output:

Evaluation questionnaire filled by sales managers Focused interview

Questionnaire on motivation Case study Attitudinal interview

Salesforce revamping (2009)

HR + Line + Eni Corp. Un.ty

Eni Corp. Un.ty

20

Competences

Problem solving Adaptation skills Communication skills Negotiation skills Network building Organisational skills Focus on achievement Initiative Organisation

Salesforce revamping (2009)

Motivation factors

Relation with the company Individual commitment to change Career expectations

21

Another training program agreed between unions & company (2008)

In 2008, Eni G&P signed some specific agreements on training.

Thus, the company was enabled to make use of Fondimpresa funds (public

funds for training activities) to organise the following courses:

Safe driving – about 200 people involved (Professional area: Sales - large

customers) IT skills – about 110 people involved (Professional area: Sales - mass

market)