Read Online Private Empire: ExxonMobil and American Power by Steve Coll - Free Book Online

cost reductions, reassignments, demotions, salary reductions, and job cuts, the pressure only intensified. A former executive once described the ranking system as “dog-eat-dog competition under the patina of working together.”
    Even before the
Valdez,
Exxon had been a place that emphasized procedure and cultivated orthodoxy; with the inauguration of O.I.M.S., the i-dotters and t-crossers rose to predominant authority. Because of the nature of its business, Exxon’s recruitment was biased toward engineers, scientists, accountants, and personalities who were comfortable with rules—people who were pleased, even eager, to work for one company all their lives, and to move from place to place in its service. Senior executives noticed that employees tracking for management tended to reach a point—somewhere around four to seven years after joining the corporation—when they either committed to Exxon or left. Those who stayed did not find O.I.M.S. ironic or extreme; they
liked
the culture of discipline and accountability. Restless free thinkers and habitual dissenters who accidentally got hired (often as scientists) tended to decide quickly that they would be happier elsewhere. The result was a corporation led in its upper management ranks by people who were not only supporters of the O.I.M.S. reforms, but true believers. 25
    Around an industry conference table, Exxon’s delegation usually dominated. “You don’t like them, but you respect them a lot because you know that they’re really smart,” said a competing executive. An Exxon delegate to an industry committee meeting typically arrived with a binder full of research, colorful PowerPoint slides, and carefully outlined remarks that reinforced the impression that he was “the smartest guy in the room.” Exxon’s sheer size meant it enjoyed advantages of research and scale; if Mobil dispatched one lawyer to an industry conference, he might arrive to see two or three from Exxon across the table, shuffling through the papers they had spent many hours preparing as a team. 26
    The ultimate measure (and the chief purpose) of this management culture was Exxon’s financial performance. Even during the early Lee Raymond era, a time when oil prices gyrated disruptively and at one point fell to historic lows, the corporation’s performance was superior from quarter to quarter and year to year. Exxon earned $6.47 billion in profit in 1996 on $110 billion in revenue, more profit than any American corporation that year except General Electric and General Motors. Mobil, the next-largest American oil competitor, posted about half of Exxon’s profit margin. Exxon made more profit on each dollar it invested than any of its American or international competitors. Its exceptional ability to complete massive, complex drilling and construction projects on time and under budget meant that, in comparison to industry peers, it remained exceptionally profitable in recessions and boom times alike, when oil prices were high and when prices were low. 27
    The Exxon way came across as arrogance to many outsiders. Raymond once stepped before a large conference of Wall Street analysts and announced, “What you’re hearing today may seem boring. . . . You’ll just have to live with outstanding, consistent financial and operating performance.” As to the performance of Exxon’s competitors at Chevron, Royal Dutch Shell, and British Petroleum, Raymond added, “I have to [say] I am surprised at the apparent lack of focus.” 28
    “Exxon’s attitude toward the other majors has always been, ‘We are Oil—the rest of you are kids,’” said a long-tenured executive at a competing company. Exxon became such an oft-cited antagonist in this oilman’s household that once, when the industry seemed troubled, his daughter asked him, “Dad, do you think things will get so bad that you’d go to work for Exxon?” (“No, I sure hope not,” he answered.) Rockefeller Goodwin, a descendant of the