How Do Firm Transportation Agreements Produce Unsustainable Leaders?
Are you unwittingly locking yourself, your teams, or your families into agreements that severely limit your ability to survive…let alone thrive?
In today’s episode of The Energy Detox, we challenge you to uncover all the ways that you and those around you may be operating under outdated contracts that—like firm transportation agreements—may no longer work for all parties, that may severely curtail the chances of producing sustainable success, that can increase the odds of figurative bankruptcy, and that will cause you to stand there asking, “Did I really sign up for all of this?”
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TRANSCRIPT:
00:00
Hello and welcome to The Energy Detox...a leadership podcast with oilfield flare. Our mission here—and the mission of our sponsor, Witting Partners—is to help you practically find and remove the junk that is unwittingly holding you back from producing sustainable success in both your professional and your personal lives.
00:34
I'm your host, Joe Sinnott, and today we're going to discuss the benefits and the risks of firm transportation agreements and what they can teach us about sustainable leadership. Building upon some of the themes from Episode 2 warning against the dangers of over-relying on a single source of information or guidance (like a GPS) to get to your destination, today's conversation focuses more on why you're on a particular journey in the first place and how there are lots of things like firm transportation agreements or their figurative equivalents that can really cloud our vision, decrease our ability to make sound decisions, and easily cause us to lose sight of our ultimate destination or objective, whatever that happens to be.
01:18
And throughout this episode we'll challenge you to try and seek out and identify those hidden contracts and those unknown agreements that you might unconsciously be abiding by and that might be holding you back from personal and professional success in some way. And we'll challenge you to be on the lookout for similar agreements that you might have unwittingly signed your stakeholders up for and that could be holding them back as individuals...and, in turn, holding back your entire team or your family in some way.
01:48
But before discussing those figurative contracts—and with apologies to those of you who are already well-versed in the dynamics of transporting hydrocarbons—let's take a few minutes to get a few basic definitions out of the way, starting with transportation in general.
02:03
So when we're talking “transportation” today, we're not talking about the millions of cars taken off the road the last few weeks or all of the airplanes that have been grounded. We're talking about when an operator producing oil or natural gas has a relationship with a midstream company—or for simplicity today we'll call it a pipeline company—to transport hydrocarbons from one place to another. Because if you're getting oil or gas out of the ground, you obviously want to move it to a location where you can get paid for it...even if the price someone is willing to pay is abysmally low, as it is today.
02:34
So you obviously try to figure out where you want it to go to be sold or processed or exported, with the ultimate goal of getting paid as much as possible for what you produced. And thanks to the dynamics of supply and demand, you can obviously sell your hydrocarbons for different prices in different markets that in some cases could be hundreds or even thousands of miles away from your wells. So an operator would have incentive to pay a pipeline company a fair amount of money to transport a product safely to where it can fetch the most money possible, net of whatever the cost to travel through that pipeline is, of course.
03:06
And the arrangements that an operator might have with the pipeline companies can vary. It could be a simple as the producer saying, "Hey, I might have some hydrocarbons that I'd like to sell, so if you as the pipeline company happen to have some room in your pipe on occasion to take what I have and transport it, let's get my gathering infrastructure connected to your pipelines, and I'll pay you some amount per barrel or per decatherm whenever we're able to send you some oil or gas.
03:32
And this arrangement would be an example of an interruptible transportation or interruptible service because the pipeline company is not committing that it will have the space to take your oil or gas, and the producer is not committing that it's going to produce a certain amount of hydrocarbons to send into the pipeline on a regular basis. So the risk for the operator in this interruptible scenario is that there's no guaranteed pipeline space, and it could be full or unavailable. And even if the producer is actively flowing hydrocarbons into the pipe, it could be interrupted at any time because the pipeline company has more important customers than those who are simply looking to occasionally use their pipe.
04:08
And because there's minimal incentive for the pipeline company to go ahead and take the risk of building extra capacity to take more gas or oil without some guarantee that they will be able to generate revenue from it in this interruptible transportation setup...which brings us to firm transportation, or FT.
04:26
With firm transportation, the pipeline company is saying, "We're going to guarantee you space to move your product from point A to point B, and we're going to give you the best service possible so that you can be assured that—barring some act of God—you will be able to move ‘X amount’ of volume of hydrocarbons per day to their destination. And in many cases—assuming the pipeline company doesn't have existing space available—the pipeline company is going to go ahead and spend a lot of money to build a new pipeline to handle the capacity that a producer and probably other producers have said they need.
04:57
In return, the pipeline company logically insists for some long-term agreement because they're not going to spend what could be hundreds of millions—if not billions—of dollars to build a pipeline and guarantee a level of service without some contract locking in the producer for some minimum amount of volume for some minimum period of time. So once both parties (the producer and the pipeline company) have entered into a firm transportation agreement, what does it mean?
05:25
Well for the pipeline company, it means that they're probably going to start spending a ton of money to get a pipeline built and ready for whatever in-service date is laid out in the contract, and it generally means that they can expect a guaranteed return on their investment from the money the operator is going to be paying them for many years once the pipeline is completed. And it doesn't matter whether or not the producer is actually using all the capacity they asked for, because the contract likely says that you must pay this minimum amount per year whether you are using the capacity or not.
05:56
So for the pipeline company, assuming they have a handle on the costs of building and then operating their pipeline, they likely enjoy the knowledge that they are going to get paid by their customers what is expected because the revenue and the costs typically aren't dependent on the price of oil and natural gas. So, really, the biggest risk is simply that the producer goes bankrupt and doesn't have the ability to meet the minimum terms of the contract. Because if that happens, and unless another producer comes along and is willing to pay for some unused capacity, the pipeline company might not recoup the investment it made in the pipeline.
06:27
Now, obviously, given today's oil and natural gas prices and the steep decrease in demand, there have been and will continue to be producers declaring bankruptcy, which could lead to the nullification of certain contracts...which could mean that they won't be holding up their end of the firm transportation agreements...which in turn wouldn't be pretty for the pipeline companies and could lead to them declaring bankruptcy, too.
06:48
So, having covered the pipeline side of the equation, what does this firm transportation arrangement mean for the producer/customer? Well, as we said, the producer is on the hook to pay some minimum amount of money for many years whether or not the capacity is actually needed. If the producer wants to keep producing and using the capacity to get to whatever market the pipelines deliver into, then great; that producer can then more easily plan a strategy and lock their development plans in place, knowing that the transportation piece is taken care of, and they can shift their worry to simply drilling wells as efficiently and safely and cheaply as possible and filling that pipeline.
07:24
And as a bonus—depending on the partnership the producer has with the pipeline company—the producer might even get some incentive for signing up for a long-term contract in the form of a big old pile of cash up front that they can use immediately to fund their operations. Kind of like how you might sign up for a two year cable or internet contract, and they'll give you a $200 Visa gift card or something.
07:44
But what if things change? What if the price at the other end of the pipe no longer justifies the cost that is being paid to use the pipe? What if the market conditions make it unprofitable to keep producing gas or oil at the levels assumed when the agreement was signed? What then? Well, short of trying to re-negotiate some mutually beneficial terms where the producer's obligations are reduced and the pipeline company can still get paid back for the large investment it's made (which far exceeds the value of a $200 gift card and the cost of a technician to come out to your house to connect a couple of wires and hook up your new modem), the best option would be to find some other producer to use the capacity instead...which, if it's a larger industry issue that's driving the operator to scale back production, is obviously going to be a challenge.
08:31
So what else happens if the producer no longer has the desire or the ability to meet its capacity commitments? Well, without getting into the unlimited number of contractual mechanisms that could exist, the simple answer is that the producer winds up paying a bunch of money for a level of service and an amount of capacity that's not needed. Going back to the TV and internet analogy, it would be like if you had locked in with your cable company for two years with the best sports package possible. And now you're sitting at home and half of those channels are useless to you because live sports don't really exist anymore.
09:03
Clearly, this wasn't what you intended when you signed up, but that's the risk you assume whenever you entered into the agreement. And now you're stuck paying for channels and service you don't really want or need. The other option—as mentioned before—is bankruptcy. Obviously this is not ideal, but it is an opportunity to deal with whatever debt and liabilities exist. And a long-term FT agreement worth what could be billions of dollars obviously falls into the liability bucket if it's no longer needed.
09:33
So with all of those basic definitions and terms out of the way, how do firm transportation agreements relate to our ability to sustainably lead at work and at home? How does being locked into a long-term contract of sorts that could make sense at one point in time and then look abysmal in hindsight years later apply to our own growth and development? And how many figurative contracts are out there that we're not even aware of yet somehow dictate our actions or the actions of others?
10:07
Well, going back to the cable television analogy, why were so many people for so many years (up until the age of cord cutting that we're in now) signing up for often frustrating cable contracts and packages? Well, it was largely because they felt stuck. They felt options were limited, and in some cases there was maybe only a handful of channels they actually wanted, but they couldn't get them anywhere else. And this might have been their only option...or they simply lived in an area without much competition...or they didn't want to deal with the hassle of switching to another provider because their DVRs were filled up with 500 hours of shows and movies they didn't want to lose. Whatever the excuse, people often felt stuck.
10:49
And in many cases they were somewhat complacent, paying a ton of money for something they really didn't need. Just as many producers—regardless of their motives for initially entering into a firm transportation agreement—may find themselves overpaying for something they really don't need now that demand has fallen...now that commodity prices have fallen...and now that the level of production will logically fall, too.
11:12
But halfway into your long-term firm contract, you as the customer likely have limited options. You might want to just "cancel cable" and go with a cheaper option like an antenna. Or you might want to get rid of a large chunk of pipeline capacity (or channels) and only rely on a sliver of what you assumed you would need initially. But those actions often come with a cost to cancel. Or if you say you just want to scale things back, you're often told, "Okay, you can reduce your level of service, but it's still gonna cost you the exact same, so you probably don't want to do that anyway."
11:47
And, obviously, if there's some kind of penalty or break up fee, you can simply look at some comparative economics to decide what the best point-forward decision is. But, ultimately, you're likely to still feel somewhat stuck, and you might wish things were different. But you have a contract in black and white, and you're going to live with it. And beyond "feeling stuck" or sitting there revisiting decisions you—or perhaps someone else—made years prior, what else happens when you're in a firm agreement?
12:16
Well, one thing is that it often changes how you think and how you view your strategy. It can cause you to not ask questions you should be asking. It may not prevent you from complaining about your situation, but it might cause you to stop questioning whether you really need any TV channels or that pipeline capacity or whether it makes sense to continue business as usual because "there are things already in motion" and it's easier to just keep chugging along. And if you allow a firm agreement of sorts to alter your thinking, then it could very easily prevent you from seeing things that are hazardous to your long term development in success and well-being.
12:55
So, our first big question today is, "What agreements do you have in place causing you to not ask questions you should be...or that might be clouding your ability to see the big picture?"
13:07
What agreements do you have that make you feel like you're forced to produce something day after day at a given level...whether it actually makes sense or not? What contracts do you have that are holding you back from changing direction or altering your strategy? And how often do you not even realize that you're part of an agreement or a contract that is nevertheless impacting your life?
13:28
And obviously we're no longer talking about pipeline agreements and cable contracts anymore. Because while those are two very real professional and personal scenarios, our goal today is to uncover what figurative contracts might be governing your day-to-day operations, whether you realize it or not.
13:45
So starting with some potential examples from your personal life: are there agreements of some sort that apply to your role as a spouse or parent? Because I know one unofficial agreement that our eight year old son thinks is written in blood is that we read Harry Potter each night before bed for 30 minutes, starting at eight o'clock. It's a routine that developed a few weeks ago, and it's generally enjoyable by all parties, and it's nice to have that dedicated time to him after a full day of chaos, managing his siblings and especially now with home schooling thrown in the mix.
14:19
The problem is that any alteration to this schedule is met with fierce opposition. And he generally doesn't honor our claims of force majeure. If his sister threw up all over herself and her crib needs to be tended to or something else arose that required us to alter the schedule a bit, he holds firm to the agreement he believes is in place and will hold us in "breach of contract" if we don't hold up our end of the bargain.
14:43
Another scenario could simply be the division of chores between a mother and a father, where maybe one person regularly washes dishes after dinner while the other one gives the kids a bath. If the mother does one roll and the father does the other one long enough, it might start to feel like a firm agreement of some sort has been established. Or same thing as far as who is cooking dinner while the other one takes kids outside to play or takes them to an activity of some sort. Again, it's easy to settle into a routine that at some point starts to feel like a firm contract. Or again, who in the family handles bills...or does grocery shopping...or serves as the teacher for the home schooling and remote learning that's going on in many households?
15:27
Whatever those roles are, it's easy to start to feel like those are your roles and your responsibilities, and you need an exception to alter those. And odds they didn't just happen by accident and that you were hopefully able to be thoughtful and discuss who does what. And hopefully you can communicate with your spouse about what you'd prefer to do one day that's different than the next. And, yes, often those roles are dictated by work schedules or other factors. But regardless of how they came to be, you might get to the point where you ask, "Wait, why am I doing this particular thing? And should I feel bad for wanting to do something different? Do need to hire a lawyer to see if I can tweak things a bit?"
16:08
And maybe some of these seems silly, but the fact is that you've got so many unwritten contracts out there, and if you're not careful, you might find yourself going through the motions without asking whether what you're doing makes the most sense for you and all of your stakeholders.
16:25
And in a work environment, there are tons of examples of similar situations, except in those situations, it can perhaps be more difficult to communicate clearly and ask someone else to clarify or even to break some unofficial agreement that's in place. And you might feel even more stuck and less in control, especially when different levels of management are involved.
16:45
So what kind of things are we talking about in the professional world? Well, for one, maybe you're the person at the office who always arranges happy hours. Or maybe you're the person who always gets a nice card for everyone to sign if there's a new baby or if it's Administrative Professionals Day or someone is sick or celebrating a big birthday or work anniversary of some sort. And maybe if you happen to be one of those people, you enjoy that particular role. But do you also feel like you're obligated to be that person every time, no matter what, whether you want to be or not?
17:18
Or what about when you as an employee start and end your day? Certainly, for many folks, there might be some defined start and end time, which is nice if it's clear, especially if you do shift work or you're an hourly employee. But what about where a formal start and end time are not clearly defined? Do you feel like there are unwritten rules you feel obligated to abide by? Have you ever felt like you should be at your desk before your boss arrives and can't leave until after your boss leaves...which can be the case in some cultures and at some companies, especially for younger employees?
17:54
Or have you worked in an environment where you're—despite not being officially "on call," you feel like you are expected to immediately answer e-mails and texts of minimal importance at all hours, whether it's in the middle of the night or throughout the weekend or even on a vacation? And even though there's no formal contract and even though you may have management who says they don't expect you to respond to everything ASAP, do you still feel somehow locked into specific terms governing your accessibility and your availability?
18:26
And even if you have gone off on your own and started your own business and work for yourself, in what ways do you carry a mindset formed from working in a demanding environment—as many in oil and gas do—where 60+ hour weeks are the norm and where obviously 40 hours is an absolute minimum? And if you're not working 60+ hours or if you're not working at least those 40 hours, you're a failure and you're not working hard enough?
18:50
But, of course, who set 40 or 50 or 60 hours as a minimum amount? Nobody! If you can get done what you need to do in 20 or 30 hours per week, isn't that a good thing? Of course it is! So how does that thought linger in your head? Why do we have all of these expectations of ourselves, and why do we feel like we're operating under some contract when in all these personal and professional examples we threw out, there's obviously no firm agreement in place...and when the other party (to the extent there is another party involved other than ourselves) would immediately say that we're not locked in and that nobody's saying that we need to do X, Y or Z?
19:31
In many cases, we'd argue it's precisely because things aren't laid out clearly that these false expectations are allowed to fester and to take on a life of their own. And, sure, some jobs and roles are black and white: "you show up; here's your title; here's your list of responsibilities; for any questions, ask your supervisor; and for any problems with your supervisor, here's HR's phone number; work hard, be safe, have fun...and you get paid every Friday; have have have a nice day; take care."
19:57
But most jobs are not as black and white as that, especially in an industry as dynamic and evolving as oil and gas...especially if you've been at a company for awhile, and you understand how all of the unwritten rules play out...you know that there's a range of performance and aptitude for similar roles, or even for people with the exact same title such that you could go ahead and plot and see the likely bell curve that would result. And beyond performance and abilities, there's a range of responsibilities from person to person, even if they have the same official title. And when you have this diversity (of talent), there is logically going to be different expectations for different people. But what governs those expectations?
20:42
Same is true, of course, in a household: husband and wife, mother and father, sons and daughters. No universally agreed upon definition of responsibilities for each, although plenty of default expectations that can feel like they are set in stone at times. But ultimately there are lots of variables that will cause the responsibilities to change over time, especially for children as they older and as they become more capable of helping with different chores.
21:06
And while a company or a family may institute some formality around expectations and objectives and SMART-ly outline Specific, Measurable, Attainable, Realistic, and Timely goals for each person to accomplish whatever is needed, the reality is that much of what that person does falls outside of a clearly defined set of rules. So what's governing their actions and decisions and contributions? How do they know they're doing the right thing? If it's a young child, they're probably being reminded constantly about what needs to be done. And—at least in my home—we've tried all kinds of checklists and posters and whatever we can dream up to remind them of the basic things we expect of our children. And if it's a “go-getter” employee or child, they might constantly be asking their manager or parent how they can help. Or perhaps they go ahead and proactively seek out work...and odds are that they're figuring out what they should do...or they were asked one time to do something, and they decided it was worth doing again and again and again and again, even though they were only asked to do it once.
22:10
And all of that can lead to some form of self-governance that obviously appears good but can quickly turn into some firm agreement that they're abiding by unnecessarily and where they're adhering to these contract terms that they're the only one who signed up for...and if you as a leader knew about what they were doing, you'd likely question it and perhaps put an end to it.
22:36
A very good example of this comes from the world of internal reporting at a typical company...think about a situation where there is some regular report that comes out...let's say weekly. And maybe it's a report that has been e-mailed out to a big list of people at every level of the organization for years and years and years. And this report goes out un-interrupted. You know, this is something that’s got some pretty important people on it, so "we got to get this out the door." But nobody actually knows who's looking at it or even if it's worthwhile. And while we're using an e-mail is an example, in more modern times, it still could apply to a dashboard that somebody has to maintain, and while you might be able to see who opens it up on occasion, nobody really knows what it's actually being used for by the people that open it up because it's just been going on for so long.
23:22
Yet the person sending it out is operating under a contract of sorts, and that person might have inherited the responsibility from someone else who, in turn, inherited it from someone else. And they might be the fifth person in charge of sending this out over the years. And all they know is that it's supposedly important because there are some executives on the distribution list or some executives who have access to this dashboard...and because it's always been that way.
23:45
And as companies rightly move to a self-serve reporting structure and increase the data literacy of all employees, hopefully those situations fade. But the reality is you have situations like this where an employee is spending valuable time and energy and feels under pressure to maintain and distribute this report, which may not even be relevant or useful anymore. But they're operating under some firm agreement to keep on sending it out. And if he or she asked a handful of folks why it was necessary, odds are pretty good that the answer is "because we've always done it that way," which is still a top—if not the top—reason many processes continue within an organization, right?
24:24
So what can a person do in that situation? Well, one approach is to simply stop sending out the report and see if anybody responds or cares. That's an old reliable trick, right? Or we could be a little more proactive and send a communication out asking if anybody still needs the report, which could get a few people lying and thinking they do (need the report) and saying, "Yeah, yeah, yeah, keep sending it...why not?" Or you could decide to rip up the "contract" and go ahead and tell the recipients—whoever they are—that it's 2020 and it's time to move to self-serve analytics...and go ahead and tell them it's time to increase their data literacy to some degree...and that the organization could do better than a canned and stale report that probably isn't answering the questions they need anyway.
25:08
And obviously, while that last option might be a little harsh. Let's also keep in mind that there are probably 100% of public speakers or consultants or leadership coaches or life coaches right now who at some point have chastised an individual or an audience or organization about not simply doing something "because it's always been done that way." And it's become so clichéd, in fact, that you probably hear that these days and say, "Yeah, yeah, yeah, I know, I know. No, I know we shouldn't be doing things just because we always did it."
25:37
And the problem with that is that if you get to the point where it doesn't even resonate anymore...you hear that question or hear somebody say, "Hey, why are we doing this? Oh, because we used to do it," and it doesn't even click anymore. But the thing is, it's still critically important to keep on asking "why you're doing what you're doing," at least on occasion.
25:53
And we're not talking today only about processes and reports and operational workflows and development strategies...we're talking about how you approach whatever your responsibilities are, how you define yourself, how your team members and family members define themselves...and ultimately we're trying to answer the question of what is governing everyone's view of what they are supposed to be doing.
26:18
One of my favorite responses to these types of situations—and apologies for not remembering where I heard it—but when someone says "I should be doing this" or "I should be doing that" or how "I need to wrap this up," you go ahead and respond to them: "Says who? Who says you need to do that? Who says you should be doing X, Y or Z?"
26:39
It's a simple and very powerful response—and again, not my own idea, so if you want to claim this recommendation or if you have a guess as to where I heard this, please shoot me a note and I'll be sure to update things and assign proper credit. But regardless of who came up with this response, it's perfect! It can stop people in their tracks simply asking, "Says who?"
27:00
Who says you need to eat your vegetables before your dessert? Who says you shouldn't swim for 30 minutes after eating? Who says you need to look presentable and shave each morning...or at least once per week...or—after a couple more days of growing a quarantine beard—we might be measuring it monthly here in the Sinnott household.
27:20
And regardless of what the question is, why do we allow ourselves to enter into these contracts when—in many cases—there isn't even another party holding us to these made-up terms and conditions other than ourselves? Well, the answer to this is because there often is another party involved, of course, and that other party may unwittingly have signed you up for a firm agreement or a contract of sorts. And even though your immediate response if someone asks, "Who says you should be doing this?" might be to name someone (a manager or a parent or a spouse or whoever) very quickly, you realize that there's probably not some explicit requirement or request, despite what you might feel.
28:04
So what does that mean for you as a leader? Well, it obviously means that you need to be incredibly aware of those situations when you might be unwittingly causing people to act in a way that isn't intended. You need to ask yourself what's driving the actions of people. If there are clear objectives and goals, especially for a well defined project, then great...but so much of what people do with their time and energy is discretionary. And if you're figuratively looking over their shoulder every time they look to exercise discretion, you're likely destroying a ton of value for that person, for the team, and ultimately for the larger organization.
28:40
And none of this is to say that an old way of doing things is inherently bad. And none of this is to say that you don't want people to abide by rules and regulations and standards of some sort. But the point is that you—as a leader—should want all of your stakeholders to be on the lookout for better and more innovative solutions and to be asking themselves in what ways they could better use their time to generate more value or to avoid hazards and traps and barriers that could pop up.
29:06
Because ultimately, if you have a team or a family that is working off of a long-term firm agreement, so to speak, your shared success is not likely to be sustainable. There might be some elements of your life that benefit from following a single routine or playbook over and over and over again, and you might gain a little bit of certainty. But at what cost? Because, as we're seeing in the world today, even if you "know" the certainty you think you have is "locked in," if it's not balanced with a healthy dose of flexibility, your chances of survival are limited. And if you're so locked in to doing things one way—whether you realize it or not—you could quickly find yourself facing figurative or literal bankruptcy.
29:52
And, as we said earlier when discussing the rules of producers and pipeline companies and firm transportation agreements, the first people going bankrupt are probably the producers (the customers in those agreements). And most of our conversation today was on those times when we lock ourselves in as the customer and as the person stuck with a "contract" that could cause us to spend money or time or energy we don't really want to. But, as we said earlier, the pipeline companies are also at risk. If the producer goes bankrupt and can't fulfill its obligations, then so too might the pipeline company.
30:23
So if you're the figurative pipeline company or a manager or parent or some other leader, it's important that it might not be enough to have a good contract in place and to continue providing a level of service that meets what is required by the language of the contract. You need to be aware that your continued success hinges on your customers' success and that you need to ideally be aware of this well before you go ahead and finalize any new agreements that you put in place.
30:51
So all that being said, ask yourself—whether you're the producer or the customer...or the pipeline company or the cable company—whether it's time to start ripping up some contracts or to at least start restructuring them...and ask yourself what help you or your team might need in doing that. And, sure, there are expensive contract lawyers for actual agreements. But what other resources or tools or mindsets can help you? And how can they help you...
31:18
1) Uncover the contracts or the contract terms that are unfavorable to you and your mission and…
2) Update them or rewrite them...or at least clarify them in a way that is mutually beneficial to all parties.
And, above all, how can they help you do whatever it takes to at least make sure that you as a leader and those around you are all committed to not getting stuck again in the future...and to continually be reminded that—just as in 2020 where the vast majority of people are at least exploring their options to cut the cord and to say good-bye to expensive cable packages and choose the services—be they Netflix or Hulu or Disney+or whatever they want—often without having to lock into a long term contract.
32:03
Ask yourself how you as an individual or as a manager or as a parent or a spouse or as a community leader are embracing flexibility wherever possible and being on guard against hidden contracts and terms that can rob you of your time and your energy.
32:18
And as a final comment to the customers/producers out there, don't forget Rule #1 of being a customer....that is, it doesn't hurt to ask. It doesn't hurt to ask for some relief, or for some assistance or to knock something off your bill. Yes, on occasion, a company might go out of their way to be nice and to proactively do the right thing without you asking, like Allstate this week saying they'll be giving people a partial refund on their car insurance because nobody's driving right now...that's great, and that's the right thing to do.
32:49
But, in general, you need to be a little more proactive than that. So when you have a figurative or literal agreement in place, don't forget to ask! Ask for something that might be beneficial to you and your stakeholders,
33:02
And as a final analogy for the pipeline companies out there...or for the leaders and the managers and the parents, let's not forget that despite the fact that you might not be watching many sports for the foreseeable future, let's not forget how easy it is sometimes to try and move the goal posts on folks. And even when a clear agreement is in place, how easy it can be to keep pushing the limits and to get a little greedy...and what that do to the customer relationship?
https://me.me/i/moving-goalposts-because-nothing-motivates-employees-like-setting-a-goal-22572376
33:30
...and how at least in my role as a parent. how telling your children that they can have dessert if they just eat one more piece of broccoli...and then instinctively—as soon as they finish that one piece of broccoli—telling them to, "Have just one more after that and then you can have your ice cream."
33:45
Now in my (at times) reduced mental state, perhaps I could be forgiven by my wife for trying to push things a little more,but I can assure you that my kids are not going to let that fly. And if I do it enough, it's definitely gonna hurt my credibility and my ability to handle future "negotiations" with my young children...as much as that might sound ridiculous.
http://www.drmalviniredden.com/2017/05/24/that-time-i-invited-my-class-to-negotiate-the-syllabus/
34:08
But the reality is that the goal should be a long-term, sustainable relationship with all parties, not just some long-term contract and—certainly in this instance—not trying to push the limits or get more out of the contract than is necessary at that moment. So why? What's the benefit? It's probably not worth the whining and crying and the damage that I might sustain as a father that wants a level of trust between him and his children.
34:45
So, anyway, with that being said, and before I wind up divulging the very long list of parenting mistakes and poor approaches that I attempt on a regular basis, I'm going to stop there with the parenting analogies., and I'm going to leave you today with one final question. And that is...
In what ways are you unwittingly holding yourself or your stakeholders back from freely achieving success because of un-written, un-signed and un-sustainable agreements that are un-necessarily curtailing your production potential?
35:27
And as you ponder that, please allow me your host, Joe Sinnott, to sincerely thank you for listening...with special acknowledgement to all of those involved in designing, building, and providing 24/7 maintenance and monitoring of the pipelines and the transportation infrastructure that are so critical to the oil and gas industry and to safely meeting our country's energy demands (reduced as they might be at current time).
And for more information about this podcast or our sponsor, Witting Partners, please visit us at theenergydetox.com.
36:00
And until next time, as we all move forward through the realities of an extended quarantine, please remember that you shouldn't feel obligated to sign a “firm agreement” that commits you to weeks of “self-improvement” and “personal transformation” and getting big projects completed while you're isolated and staying at home.
And no matter what pressure you might feel from social media or from influencers or from friends and family who are facing different circumstances than you are, please remember that the last thing many of us should be doing right now is committing—let alone over-committing—to filling all of our available capacity and all of the supposed free time on our calendars with activities and tasks and Zoom meetings and everything else just because someone is telling us what a "once-in-a-lifetime opportunity" we have…and that we need to sign up and take advantage of this incredible “offer” that you might not actually want hanging over your head for the next several weeks and altering your mindset and locking you in to something that might not actually bring the long-term satisfaction being promised…and that might even result in negative impacts despite the very best intentions of those encouraging us to make such a commitment.
Thanks again.