Charles Darwin once said, “It is not the strongest or the most intelligent who will survive but those who can best manage change.” In an industry that is constantly evolving, this frame of mind couldn’t be more true. Especially in current market trends, the companies that are open to adapting are finding opportunities to weather the storm.
At prices hovering around $50 per barrel, the market is already seeing an uptick from the depressed prices in 2015 and early 2016. The rise in oil prices has everyone excited for what’s next in the industry. Will prices rise once again to the $100 per barrel mark, or will we face a new reality with different price landscapes?
Most experts estimate that the oil price will never bounce back to the $100 range. Our new reality will encompass lower oil prices … and lower operating costs.
Out of hard times, innovation is born. New technology and practices are put into place to cut down the breakeven margin. And as companies implement these changes, the leadership team grows in knowledge and experience.
Going forward, the companies who have survived the downturn will look forward to an ongoing change cycle. For it’s those who are willing to be in constant change that will reap the benefits.
Oil and gas companies have highly intelligent, technologically savvy and uniquely talented employees. But we all have our limitations. In many ways, investing in accounting and financial consulting services is investing in a company’s future. While you focus on the day to day and doing what an oil and gas company does best, letting the tax and financial experts work for you can mean real return on investment (ROI) in a short period of time.
As one of the “Big Four,” KPMG operates as one of the largest accounting services companies in the world. Operating in 155 of the 195 countries in the world, it would be accurate to say that this group has a wide reach and a wealth of knowledge to offer clients. KPMG is segmented based on industry, as well as by the tax, accounting and advisory services that it provides to clients. The company specializes in asset management; banking and capital markets, energy and natural resources, government and public sector, healthcare and life sciences, industrial manufacturing and technology, to name a few.
A pillar of knowledge, experience and strength within the organization, Regina Mayor has grown within the industry and found herself taking on the large task of serving as the Energy, Natural Resources & Chemicals (ENRC) National Sector Leader and Americas Oil and Gas Leader. As the ENRC leader, Mayor works with large and small energy companies on projects ranging from tax, process improvement, financial restructuring, investment planning, growth strategy, technology deployments and more.
As a leader, and especially as a woman, Mayor is an inspiration to many. It was a great honor to learn more about her incredible journey to her current position. Through her many life and career experiences, she has earned a reputation as an expert in energy topics.
A World Apart
Mayor, a Hawaii native, stumbled upon the energy industry by happenstance. It wasn’t until she left her beloved island home that she was given the opportunity to learn about energy topics.
Attending Cornell University in Ithaca, New York, the incoming freshman faced many new experiences. Seeing snow for the first time at 18 years old, emphasized just how far from home she really was.
“I was really cold all the time,” Mayor remembers, “and when it snowed in April, I cried.” But the excitement of the new territory was infectious. With grandiose dreams, she looked forward to what was possible in her future career. As a communications major, Mayor envisioned one day becoming a broadcast journalist.
“I wanted to be the next Connie Chung,” Mayor recalls. “Or an actress. I thought, Ithaca, New York is close to New York City; I would be down in New York City every weekend to see if I could make my big break. But it was very far away. I think I went there three times in four years.”
Sadly, Mayor’s dream of making it in show business was not in the cards. But new opportunities were on the horizon. As the daughter of two teachers, Mayor was able to attend an Ivy League school in New York state with the help of a Reserve Officer Training Corps (ROTC) scholarship. And with her involvement in the military training program at Cornell, an interest in the federal government and policy was born.
“The army was really very good to me,” she says. “I did a lot of exciting things like jump out of airplanes, drive tanks and fire almost every bit of weaponry known to mankind.”
Upon graduation, Mayor was commissioned as a second lieutenant in the U.S. Army Reserve.
She was very fortunate in her timing of service, as peace was breaking out over the globe. At the time, President Reagan was downsizing the military. This made it possible for Mayor to obtain a full scholarship to Cornell and join the Army Reserve, which requires a time commitment of one weekend a month and two weeks in the summer, as opposed to active duty U.S. Army service.
During her time in the Reserve, She was commissioned as a finance officer. At the time, Mayor thought she would pick a job that would be most applicable to her civilian life. In hindsight, this was a defining moment in her life, leading her down the path that brought her to the energy sector at KPMG.
Also during her time at Cornell in the late 80s, Mayor was given the prestigious opportunity to intern for a semester at the Pentagon in the Supreme Headquarters Allied Powers Europe (SHAPE). During her tenure, she supported the Supreme Allied Commander Europe, Gen. John Galvin, as well as his speechwriter, Maj. David Petraeus, future general and CIA Director.
Upon graduating from Cornell, Mayor followed her passion for government policy to the John F. Kennedy School of Government at Harvard University, where she received her master’s degree in public policy. With her focus set on government and a fascination with defense policy, Mayor aspired to be the first female U.S. Secretary of Defense, a designation a woman has yet to gain.
Once again, however, our fates are changed in a moment’s notice and Mayor found herself heading to Houston.
Starting over in a new area, with new career opportunities, can be challenging but it didn’t stop Mayor.
“Moving to Houston was great for my career,” she says.
Almost immediately after relocating to Houston in 93, Mayor began working in the energy industry as a Senior Associate with Ernst & Young, another of the “Big Four” accounting firms. The opportunity to work with oil and gas companies gave her the opportunity for work/life balance.
“The energy business, I fell in love with it very quickly because it’s an amazing industry,” Mayor explains. “My clients were right in town so I didn’t have to travel as extensively as others in my field might have had to travel,” an important factor for the mother of three.
Working with multinational oil and gas companies, Mayor delivered customized process-improving solutions on a global basis.
After more than six years with the firm and gaining much experience in the energy sector, she became the Vice President of Marketing and Strategic Planning at Capgemini in 2000. Capgemini is a leader in consulting, technology and outsourcing services, helping clients improve their performance and competitive positioning. Mayor served on the Americas executive team with the company, working to reduce the total cost of marketing while simultaneously launching a major brand campaign for the company.
And finally in 2006, Mayor found her home at KPMG. At the time KPMG was serving a global oil and gas company in an audit capacity. KPMG had a great relationship with the company in Europe but had not made any connection with the large company in the U.S. Mayor, on the other hand, had strong U.S. connections due to her work as a service provider since 1996. KPMG brought Mayor in due to her positive relationships with this global oil and gas company, but her potential within the company beyond this significant client relationship was quickly realized. She worked her way up the ranks, finding her leadership team to be supportive of her growth in the energy segment.
With Mayor’s help, KPMG was able to transition a 50-plus-year audit relationship to an ongoing tax and advisory service agreement, which represented a huge growth point for the company. Due to specific SEC regulations, many companies will choose audit services from their audit provider and seek out other companies for tax or advisory services.
“We have audit clients, who are incredibly valuable to us and who we want to bring new ideas and thoughts to but they have rules and regulations about other things they might be able to hire us to do that we need to be very careful and cognizant of. And then we have our Tax and Advisory clients, which we can provide the full-suite of our services, and we provide them with insights from our audit practice.”
Mayor’s reputation and contacts within the industry helped KPMG evolve in the energy consulting arena, opening up their full array of services to many large energy companies.
Learning and Growing
KPMG takes on a very full-service approach to their clients. In some cases, especially for clients out of the country where mandatory audit rotations are being contemplated, KPMG provides various services to keep the client in the KPMG family for life.
“We recognize that we may be playing different roles during the life cycle of that relationship,” Mayor says. “We want to be able to bring the full power of what KPMG has to offer to the client so that they can be successful if they’re an audit client or a non-audit client. That’s what really attracted me to come to KPMG.”
Mayor’s passion and expertise in the energy industry really came to light after she helped transition the global oil and gas company from an audit client to a tax and advisory client. Her work with some of the largest and most well-known energy companies since 1993 led KPMG to embrace Mayor as an expert in the energy advisory field and provide her with many leadership opportunities that would eventually bring her to her current role. Throughout her career with KPMG, Mayor has seen significant changes in the market, the industry, her company and herself.
After only one year with the company, in 2007, Mayor was asked to lead the oil and gas consulting team, a subset of the energy practice at KPMG. She led a fraction of the number of people within her team today, but this was a major stepping-stone for Mayor. In 2009, Mayor was asked to then lead the entire Houston office in the consulting part of the company. This role made her the principal in charge of the advisory practice. Mayor was overseeing several hundred people and leading the team to grow revenue by double digits five years in a row. Once again, Mayor was asked to take on more leadership responsibilities. In 2011 she was made the head of the energy advisory team, a group that encompasses all the energy industries, including oil and gas, power and utilities, chemicals, mining and renewables. Mayor stayed in this role for many years under the head of the energy practice for KPMG.
Then, in 2015, the leader of the energy practice, John Kunasek, was named the National Managing Partner across all of the industries covered by KPMG.
“I think that was recognition of all of the great things we were doing within the energy vertical,” Mayor states. Following the promotion of Kunasek, Mayor was named the head of the energy practice in August 2015.
“The firm has given me tremendous opportunities for leadership and growth. Even though I was a relative newcomer, I felt embraced by our team and the leaders here,” Mayor adds.
But with the opportunities came challenges. She had many years of experience working with oil and gas companies but needed to create that same level of depth in other sub-segments, like utilities.
“I was very oil and gas specific, which gave me significant depth of expertise. But I didn’t know as much about the other segments,” Mayor explains.
But over time, She took on various endeavors, such as a large outsourcing project with Energy Future Holdings (formerly known as TXU Corp.) in 2005, which gave her insight and an opportunity to learn about the electricity industry. Now, after learning over many years of working with various energy companies across industries, Mayor says things are changing.
Energy Going Forward
As a service provider, Mayor has witnessed a transformational change in the energy industry.
“The use of technology has been the largest change I’ve seen,” Mayor says. “The changes that have been made and potential for what can be changed in this industry are mind-boggling.”
As technologies evolve and grow more efficient, companies are finding new, cost-effective ways to change their process to increase their ROI.
Within the oil and gas arena, companies like ConocoPhillips, Halliburton and Devon Energy are actively using new technologies to find underproduced wells to refrac. The technology is helping these companies save money and tap into oil and gas reserves that may have otherwise been unretrieved.
According to The Wall Street Journal, new software has been introduced at well sites that aids in determining the perfect amount of sand, water and chemicals at precisely the right location to extract the most oil and natural gas. In previous years, the E&P company would blast large amounts of sand to ensure that fissures stay open, but that meant a huge cost for the company. Using technology, companies are removing the guesswork from their process and seeing large benefits.
In addition to new technologies, companies are changing their mindset on the value chain on an end-to-end basis. Knowing their consumers and what their needs are is new to the energy industry, Mayor explains. The new mindset is a shift to a more commercialized business model with a focus on the total life cycle cost and total profitability aspect of the product and process.
“Ten years ago parts of the energy industry were still in an engineering mindset. Companies tended to be more excited about the engineering aspects that they were accomplishing and thought less about how they would ultimately make money.” Looking at the current commodity market, what is Mayor telling her clients to help them succeed going forward?
“We’re telling them to rethink everything, challenge every established norm and every part of the status quo. Some of them are, and some of them aren’t. But the successful ones, I think, are going to use this downturn as a catalyst to radically reshape who they are, how they compete, how they define themselves with their customers and what kind of talent they retain.”
The challenges facing most energy companies are basic in nature: access to capital and liquidity. But the opportunities for growth are immense. Thinking outside the box to improve current policies and practices is going to be the greatest takeaway of the current market condition. Developing an eye for talent is also a major lesson in this situation.
As far as employment, we hear a lot about downsizing. But many companies are taking this opportunity to locate the future industry leaders who are going to revolutionize the energy industry going forward.
All in all, Mayor says she and others on her team are focusing on the future and how things may change. There are going to be major social, demographic, geopolitical and technological disruptors that come up in the next 10 years that could mean large-scale changes for various energy segments.
What if there is a significant increase in use of electric vehicles? What does this mean for gasoline usage? What impact will social/demographic changes ultimately have on the number of miles traveled? Companies in the downstream market may be rethinking the use of their products in the future.
The utilities arena is going to undergo transformative changes with innovations in batteries, fuel cell technologies, fourth- generation solar and other technologies. All of these factors will affect how power is generated, transmitted, stored and used.
“Companies are looking ahead to see what may affect their value chain and what they may do under different scenarios. A lot of boardroom leaders are waking up to these realities.”
But thinking ahead and planning for these scenarios is what is going to help these companies persevere in a changing environment.
Strength in Diversity
Named a “Breakthrough Women” by the Greater Houston Women’s Chamber of Commerce in 2016, Mayor is breaking down barriers and inspiring women around the world to follow their passion as far as they can go.
She has used her diversity, as a woman, to set herself apart from her counterparts. In a sea of suits, Mayor stands out proudly in a fashionable ensemble representing strong women in the energy industry. Her life experiences, as a second lieutenant in the U.S. Army Reserve and a leader in the energy advisory sphere, have proven her ability to adapt in different environments and lead with grace and knowledge.
But the two worlds are more similar than you’d think, Mayor says. “I find the energy industry to be a lot like the Army. It’s a very male-dominated, -oriented industry.”
While in the Reserve, Regina never let herself be limited from gaining new experiences. One story she is proud to share is about her experience jumping out of a plane.
It was the summer of 1987. Mayor, a mere 20 years old, was sent to paratrooper training at Fort Benning, Georgia. She was one of about 15 women there at the time, out of 500 troops, learning how to fall properly and preparing to jump from a plane. The boot camp style was challenging mentally and physically for Mayor, but nothing can prepare you for the fear that comes over you on your first jump.
When the time came for that first leap, the Sergeant Airborne went down the aisle numbering off the order of jumpers. As he walked by, he tapped Mayor’s helmet, said “one” and kept going down the line. Mayor realized she was going first. It wasn’t easy to conquer that fear, but she did it. She jumped first and then did another four jumps to earn a badge she proudly displayed on her uniform, signaling she had completed the required five jumps.
When the day was done and she made her way back to the female barracks, Mayor learned that most of the women, out of the 15 that were stationed there were the first to jump in their groups.
Keep in mind that this was the summer of 1987. The U.S. Army was leveraging the women on the teams to motivate the rest. But this was more than just a ploy by the Army.
“It taught me a lot,” Mayor reflects. “It taught me about leading from the front, conquering my fears and the importance of diversity in leadership. These lessons are a part of who I am.”
Within the industry, women are growing into more leadership roles now than ever before. No one can say that men are a better fit for a role because of their gender-specific skill set, and the same can’t be said for a woman. But that doesn’t mean there isn’t strength in being a woman in a male-dominated industry.
“I have learned to value what I bring as a woman. I know I stand out; I look different from everybody else. I try to make myself memorable in a positive way and use the fact that I’m different as an advantage.”
To learn more about KPMG, the leadership team, and its services, visit www.kpmg.com.
Photography: Michael Giordano