Chronicle of an unexpected decision | Chapter 2 de 4
Period 2006 / 2007
During January 2006 the demand experienced at the end of the previous year maintained its upward trend, which was to continue uninterrupted over the next two years.
Two european assignees arrived to the GDCA to help us supervise our demand management. One englishman, a nice and pleasant young man, who quickly won the friendship of our employees; and another spaniard, who was the opposite.
At the same time, we received rperiodic visits from Bob Byers, from USA, whom I had known for many years and he was always a very good help to everyone with whom he interacted.
Simultaneously, Jorge Ober's health worsened and the little time he could devote to the GDCA was reduced to sporadic visits. After the death of his wife, he did not recover and that made me very sad.
The services requests were being met with a lot of effort from our side, since they implied the selection, admission and training of each young professional, prior to the services performing to new clients from USA and Europe. Many times we had to utilize the not always desired "on the job training supervised by trained colleagues.
This situation caused quite a few problems but, fortunately, all the problems that arose could be solved internally, without requesting support from outside.
In August, we had another very sad event, which strongly impacted some of us and, especially, myself. Exactly one year after his wife's departure, Jorge Ober, the undisputed leader who had ruled the destinies of the Martinez Plant for almost half a century, and who was in charge of the GDCA at that time, also left us. In addition to the emotional impact, I suffered the loss of the person I had considered my older brother for the last few years. Furthermores, my position was no longer a temporary substitution, but I became the Executive of a unit of an unthinkable size.
During a meeting in which I participated together with all the coordinators, managers and members of the Project Office and through group consensus, during December we wanted to bring back the Values and Principles that had ruled the plant during three decades, and the GDCA leadership system was thus based on the transmission of these concepts to its professionals.
The organizational culture turned out to be a set of ways of thinking, feeling, communicating and acting, improving daily, and exceeding the expectations on it.
GDCA was nurtured and adopted the following Values:
Dedication to the success of each Client.
Innovation for the company and the world.
Trust and personal responsibility in all relationships.
Based on these values we developed our Principles:
We have a passion for the business.
Promote the culture of knowledge and the development of our people
Work as a team, respecting diversity and rewarding excellence.
Manage flexible work options.
Based on these Values and Principles we define:
To be a world center of excellence in Information Technology solutions of high added value, evolving permanently and generating a long term relationship with our clients and the Community.
To achieve the full satisfaction of our Clients through the continuous training of the company's human resources, promoting their active participation and innovation within a friendly work environment, and constituting the quality model to be followed by the industry.
The Vision and Mission allowed us to develop short term Objectives (examples for one year):
Reach a level of 1,000 people by the end of that year.
Expand service offerings: quality, qroject Managers, solution architects
Meet the cost reduction objectives committed in the Unit's annual plan
Achieve 99% customer satisfactory by the end of the year.
Reach the satisfactory level in the audits performed.
Identify individuals with critical skills and créate special retention plans
Submitt the Unit to the National Quality Award.
Offer a Master's Degree in Service Science with USAL, starting in August
By the end of 2006 our Unit had surpassed 1100 people, which meant that it had doubled in size compared to the previous year.
Several new GDCA managers had been appointed, all of them coming from from within our Unit. Only, as an example, I mention Gregorio Galati, Juan Manuel Zanada, Pablo Duarte, Eric Racero and Sebastián Ramírez de Cartagena, among other excellent professionals.
Despite the recent appointments, the Span of Control was well above the recommended 10 employees per manager. New appointments had to be made as soon as possible, despite the lack of time to give them the required training and experience.
So, 2007 began and at some point in time during the first quarter we’ve started to perceive some signs of questioning of our hourly costs by our Headquarters (HQ) in New York, which was no surprise to me, since I had already lived during the first two decades in the company devoted precisely to this issue, in the Martinez, Boulder and Valencia locations; and in the White Plains, Tarrytown and Somers HQs in New York State; and in Paris, the European HQ.
In any case, what really caught my attention was the insufficient knowledge of this HQ execs about the economic conditions of Argentina, being our country one that they should supervise its operations and costs.
I tried in vain to explain during several calls the concepts of inflation, the equivalence to cost of living, the relationship with the exchange rate, the existence of several types of dollars, the cycles of hourly costs measured in dollars, the importance of considering them over a period of time to exclude cyclical variations, my experience in following them for more than two decades, etc, etc, etc, etc. It was all useless.
The only thing they were interested in was to reduce the hourly cost in dollars and as soon as possible. Nothing else.
Months ago we had already implemented what we named the "Skills Factory", a concept that we will go into in more detail later, when it reached its full potential.
During the third quarter of 2007 the new "Olivos I" building was available to be fully rented by IBM and dedicated to our GDCA. It had 6 floors, a capacity to accommodate 1,000 people and was located in front of the Panamerican Highway. With it and "Urquiza", we already had the capacity to accommodate 1,500 people, something absolutely beyond our most optimistic imagination, just a year ago.
We had not yet reached that number of people, but watching at the behavior of the demand for services that came to us from USA and Europe, it was not at all utopian that we thought that this could become a reality...
And that, indeed, happened.
By the end of 2007 the GDCA already had more than 1900 people and the space available in the Urquiza and Olivos I buildings were again insufficient to accommodate our Unit.
The construction of a new building, "Olivos II", which would be similar to "Olivos I" and would be located on the same premises, was then undertaken. Both twin buildings, easily spotted by those driving along the Panamerican Highway, were to become from then on an icon of reference associated with IBM, whose silver acronym "Olivos I" was displayed on the upper right hand side.
As a reference, at that time, IBM had eight GDCs worldwide which, ranked by size from largest to smallest, were located in: India, Argentina, Czech Republic, Brazil, Hungary, South Africa, China and Malaysia. The total number of professionals working there was well over 20,000. These facts alone spoke on the importance we need to give to the young professionals joining our Unit.
As the organization continued to grow, new managers were added to the starting group. They came from our own Unit and with them we created the Management Team (MT), which was made of a dozen members.
In our unit, the following services were provided:
Server operations (55% of the GDCA professionals, including Applications Hosting, Server disk space management, Backup and restore, Operations and monitoring, E-mail administration and security, and Updating of software)
Security, asset and risk management (24%, including Administration and identification of access to systems, assets and orders)
End-user services (14%, including End-user service center and Software distribution and administration)
Service management (7%, including Account management and customer relationship management, Problems and changes, Project tracking, and Process design and planning)
The GDCA capacity was:
Unix servers: 8,400 images
Wintel: 25,000 servers.
Databases: More than 6,700 multi-brand databases.
Backup & Recovery: 3,300 servers, 6,100 Terabytes per month.
Storage/SAN capacity: 2,850 Terabytes.
Mainframe storage: 239,722 Terabytes
System z/OS: 52,295 Mips
Storage: 569 Terabytes
For those of us, who were responsible for its management, this was a real pride (without a doubt), but at the same time, a tremendous challenge.
The GDCA was connected through the technological campus to IBM's internal network in a redundant way, thus enabling secure and reliable communication with our clients all over the world. Therefore, it remained connected in real time 24 hours a day, eliminating geographical distances.
During the Welcome courses for new employees, one of our Managers communicated to them the meaning of the Vision, Mission and Objectives, and their relationship with the daily activities they had to perform. We were fully committed, considering that the main idea should be to "Lead by Example", incorporating the intended culture in a natural way.
These concepts were reinforced through biannual meetings, in which all staff participated, the company's intranet, an internal communications system including interviews with the Management Team; communications from me to coordinators, team leaders and managers with relevant information on clients and trends.
We decided to turn our GDCA into a center of excellence (COE), internationally recognized for the provision of critical professionals that required a long development process, such as: experts in Mainframe, Unix, Databases, Backup & Restore environments and others.
We also developed a flexible organization, supported by a correct selection of professionals, right training, a new system of clear objectives and teamwork.
This allowed us to créate self-directed groups, complemented by a structure of coordinators and team leaders. Indirect personnel was always tan tan 4%.
The GDCA achieved the ISO 9001:2000 norm certification, and Level 5 of the e-SCM model (eSourcing Capability Model for Service Providers), awarded by Carnegie Mellon University, USA; the highest possible level, making us the first organization to achieve it in IBM worldwide.
Our Unit was also published as a case study in the prestigious "IBM Systems Journal" for being a company that consecutively and successfully applied these two quality models to provide services and optimize management.
At the beginning of 2008, the initiative arose to apply the National Quality Award management model within the strategic management of the GDCA.
The Value Chain was made, upstream, by the service organizations in USA and Europe, which coordinated the allocation of demand to the IBM GDCs and provided the required technical support for their activities; the local network of HR providers; the local providers of IT infrastructure, buildings and security, and the local IBM executives who ensured the resources to finance all the above.
On the downstream side were the project managers from USA and Europe with whom the GDCA interacted at first, by providing its services; and then the End Users (EU) or recipient companies.
The promotion of excellence upstream was achieved through: the mutual exchange of knowledge between the GDCA and service organizations in USA and Europe; an agile and efficient service demand planning system, open by competence and service line; investments by providers to attract professionals in the country; and data and voice network infrastructures with the latest technology, among others.
On the downstream side of the chain, excellence was achieved through on-line information exchange systems with foreign clients and end users; control panels to monitor accounts behaviors and proactive indicators.
Due to the importance given to our people´s opinions, we receive information as much detailed as possible, to use for improving our services.
To review all data, we used different tools:
Information processing and analysis of customer satisfaction in USA and Europe through an annual survey, measuring indexes and specific reasons for dissatisfaction. Based on this research, action plans were established with responsible parties and implementation dates.
Visits to the GDCA by our clients were promoted and organized, showing all actions to improve our service’s quality and reciprocally, visits by members of our GDCA members to the client’s' and end user’s facilities in several countries.
Analysis of our Unit's staff satisfaction with the departmental climate survey.
Since it was critical to have the right personnel at the right time, periodic meetings were held with suppliers to ensure the availability of professionals at the required times.
Access to cutting-edge information available on the Intranet, regarding organizational models, search for new efficiencies, management tools, successful experiences, etc.
Internally, the sources to review were surveys and feedback meetings between managers and employees; as follows:
- Annual work climate surveys.
- Annual manager's survey: all the employees answered anonymously on different points; the manager evaluated his performance and established, together with me, specific action plans.
- Feedback meetings: once results of the climate survey were analyzed, each manager presented and discussed them and their improvement plans to his employees.
Among the actions taken after the climate and manager surveys, were:
- Increased frequency of meetings between managers and employees to detect emerging needs
- Immediate recognition of employee achievements.
- Special health programs for employees working the night shift for Europe.
- Implementation of free shuttle service between buildings and from different parts of the city to the three GDCA buildings.
- Increased company benefits: the "Big Blue" badge was given to people working at GDCA, with significant discounts and benefits.
- Integration under the same service line management of USA and EMEA specialists, to give everyone a greater opportunity for growth, without excluding any group.
During that year some accounts, due to different technical reasons, turned out to be problematic (troubled projects), required personalized attention from us and, in some cases, this special situation lasted for quite a long period of time.
Among them were: Endesa, Novartis, American Express and Manpower, and others with global coverage.
By the end of 2008, tha GDCA structure reached 3,200 people. Its space requirements once again exceeded the capacity of the Urquiza and Olivos I and II buildings. It was, therefore, necessary to open a third building on the Olivos site.
Which was the limit for these requirements?, we naively asked ourselves.
Based on all the processes described above, our GDCA had achieved a great position within the corporate units performing service export tasks.
During the 2005/08 period, as we have seen, The Unit had experienced an exponential growth, thanks to the continuous search for demand, the promotion of new lines of services and the quality demonstrated by our argentine professionals.
As an example, we can see some growth indicators:
The number of clients grew from 5 (2005) to 150 (2008).
The number of countries to which we provide services, from 1 to 8.
Turnover, in millions of dollars per year, from 12 (*) to 90.
The number of people we employ, from 60 to 3,200.
The number of managers, team leaders and coordinators, from 2 to 250.
The number of buildings we occupy, from 1 to 4.
The number of training hours per year, from 10,000 to 240,000.
It was the first time in history that an IBM Argentina Business Unit achieved international transcendence.
Regarding the relationship with our clients, there were three types:
- With IBM USA or Europe internal clients: it was through a project executive, responsible for the contract and for invoicing, gross profit and satisfaction level improvements. We had annual