Chronicle of an unexpected decision | Chapter 3 de 4

Hello everyone, once again! We've reached the third chapter of the "Chronicle of an unexpected decision", where I am bringing the GDCA's history. This is one of the most interesting chapters, given that after having read the genesis and exponential growth of this Unit, here is the crux of the plot, which will have a decisive influence on its subsequent evolution. The chaotic situation experienced here in a very short period of time changed the course of the GDCA inexorably and its magnitude was so great that only with the passage of time I was able to mentally reconstruct the facts and reach surprising conclusions.

I understand that my duty is to present everything I know objectively and with no bias, in the hope that this shared experience will teach and encourage us all to always work in a team spirit with synergy and without selfishness, in the organization and position that each one occupies circumstantially.

You can find Chapter 2 here and Chapter 1 here.

Maturity

• Year 2010

As we have previously mentioned, once a year we evaluated the personnel to move people with high potential within the organization.

To accomplish this purpose, they were trained in leadership or technical areas, according to their profile and include them in coaching or mentoring processes.

They were also participating in special projects, giving them other tasks beyond the current ones being performed, looking for recognition and visibility.

The skills factory was developed through a series of basic introductory courses (more than 200) organized in different blocks of approximately 1 to 7 months, depending on the technology, such as: Mainframe system administrators (7 months), Tivoli (3 months) and Wintel (1 month), among others.

At the end of the course, it was assigned a tutor to each student, to carry out the internship. The technical education area surveyed the students after three and six months, regarding the application of the knowledge acquired.

We should also highlight the training provided in the areas of project management and quality, which included courses and workshops on ISO 9000 standards, management tools, Six Sigma, Lean Six Sigma, eSCM and others.

Emphasis was placed on these activities since internal ISO 9000 and eSCM auditors were also teaching quality concepts throughout the organization.

We had also designed some new coaching and mentoring programs, specific to our needs, with schemes aimed at the individual development on leader’s competencies.

• More than 300 managers, team leaders, coordinators and highly trained professionals participated in this important activity.

• We also implemented programs and working groups focusing on leadership competencies, sharing experiences, seeking for mutual enrichment and consolidation of a community of leaders.

• Special programs such as round tables, executive meetings, etc., were instances that allowed staff exposure to conferences and presentations by high-level specialists.

• For this purpose, we held outdoors sessions at the Hindú Club, in Don Torcuato; at the Howard Johnson Hotel, in Pilar; and at El Castillo, in Córdoba. This would be always remembered by almost all the new managers and leaders.

• With this plan we sought to cover the short, medium and long term development of the professionals who were filling the different leadership positions.

There was an open-door policy that allowed the entire population to send their concerns, complaints, congratulations, suggestions, requests, etc. to its immediate superiors or to the HR function.

The GDCA considered that keeping employees committed and satisfied was as important as attracting a new customer.

• We had a benefits program, through which all employees got interesting discounts on products and services to enjoy with their families.

• There were other benefits: payment of broadband when employees worked remotely, prepaid medicine, garage parking, cell phones depending on the performed role, among others.

• Diversity was encouraged in its multiple aspects. We included everybody, excluding no one on the basis of race, gender, geography, origin, culture, lifestyle, age, disability, sexual orientation, economic status, marital status and religion.

• We had programs to stimulate employee development, such as a 7 x 24 library with bibliography for the development of non-technical skills; a global space with hundreds of specialized courses, free of charge, among other resources.

Information and knowledge managament

• The information needs of our organization were identified during the periodic meetings held by the negotiation area with clients (IBM USA and Europe).

• For long-term requirements planning, the need for service experts was identified, for which a postgraduate level training called SSME (Services Sciences, Management and Engineering) was created.

• With Carnegie Mellon University we worked on the implementation of the eSourcing Capability model, accessing the best practices of Services Outsourcing.

• We were instructed on the management of documentation, a vital asset to be managed through business practices and controls.

• It was classified into three groups: essential, reference, and information that could be disposed of. The retention policy was detailed for each of the groups.

Enviromental management

• Waste, depending on its treatment and final disposal, was classified as hazardous or special waste, most of which was managed by authorized suppliers and incinerated; disused furniture, donated for recycling; other common waste, sent to landfill; and obsolete electronic waste, incinerated by an authorized supplier.

• Energy management included annual plans to achieve at least 4% savings with respect to the previous year, without repeating the initiatives from one year to the next.

• We emphasized the importance of eco-efficient processes.

• We evaluate our suppliers, especially those with environmental implications, such as special waste treatment, and request their commitment to the environment. We also seek to make our employees aware of the threats to our environment and their contribution to sustainable development through various internal communication campaigns.

Corporate Social Responsibility (CSR)

• One of the first priorities was the CSR role that our GDCA had to play within out community, and we did so.

• Within this framework, several programs were carried out. As examples, the following are worth mentioning:

• The "Academic Initiative", in conjunction with several universities (UTN, USAL and UBA, among others), to provide IT knowledge to students and teachers; thus facilitating their companies admissions.

• The "Technical Training" for teachers of middle, technical and non-technical secondary schools.

• The joint plan with the "Cessi” (Software and IT Services Companies Chamber) to develope employees of Chamber’s members and other participants.

• "Labor inclusion programs" employing people with hearing impairments, blindness, motor and other physical troubles, where in some cases we had to use technology specially adapted to their situations.

• The "Aid to neighboring slum areas special program", getting in contact with the La Loma neighborhood, located very close to our three Olivos buildings, publishing a magazine to open the needs of the neighborhood to the community, giving advice talks to young people on marketing to manage publicity and written an online support request , thus contributing to financial self-management.

• The "Fishing” Foundation, collaborating to train young people from very humble homes, providing them with computer training and considering them as candidates to join the GDCA; among several other projects, equally relevant.

But the road was not all roses in our accelerated growth process.

In fact, the imperative need to develop more than 300 coordinators and managers of various reporting lines meant that the reasonable time they needed to settle in was reduced to the minimum available, before starting to operate directly in charge of the groups assigned to them.

To this consideration must be added the fact that some of them were young people with good technical profiles, but not with so many years managing teams.

And this "on the job training" process, which we had to utilize in order to meet the huge demand we had in front of us, took its toll!

One of them was that a few of them associated the role they received with that of "boss and authority of the group", thus generating a dissatisfaction that could have been avoided if we had had more time for its development.

Another of the undesired effects was to utilize in some cases the support of other people with more seniority in the company to help train some of these young people, which ended up leading to the subsequent growth of the latter in the organization, to the detriment of the former.

These are just two examples of several others that surely must have occurred, and of which I was not informed.

As the Executive responsible for the Unit, I assume full responsibility for these inconveniences and I humbly apologize to those who were affected by these irregularities.

Once we had obtained the NQA during the previous year, the way had been opened for us to try to take the next step, as it was the Iberoamerican Quality Award (IQA), whose prerequisite was to have previously won the National level.

We then began to travel the long road that implied complying with each and every one of its requirements, many of which were not included in the previous level, so we had to go and get the additional information related to the new quality activities requested by iberamerica.

The detailed information and response to the specifications took to those of us who were in charge of drafting them more than half a year, part-time, outside working hours, a clear demonstration of the vocation and love felt by those of us who dedicated many hours, which should have been used to enjoy our families.

During the first quarter of 2010, I was invited to join a phone call convened by the HR Department of our New York Headquarters (HQ). Executives of the other GDC executives also received a similar invitation.

During this meeting, the HR executive of our HQ informed the participants that the company had decided to implement a new global project, called "Global Delivery Framework" (GDF). It basically consisted in the standardization of the IT services tasks, with one of its outcomes being the reclassification of the professional levels to which the GDCs employees had already access to. Needless to say, some levels were reduced. I should clarify here that these professional levels were directly linked to the employee’s salary structures.

Knowing the profound implications that this directive would have for many of the 4,500 people already working in our GDCA, when the attendees were invited to give their opinion, I did not hesitate to be the first (and, ultimately, the only one) to express my opinion on the matter. I said that I didn’t think it was a good idea because it went against the practices in place and that, additionally at least in my country it would be a measure seriously questioned from the legal viewpoint, leading to the creation of a union to defend the rights that were being violated.

With the silence of the audience, when I finished presenting my point, I sensed that from that moment on it could generate some noise in the organization.

During the second quarter of 2010, two new unfortunate events occurred in the history of our GDCA, on top of the one I have just described.

Firstly, in the usual monthly telephone meetings (“The house”) that I had to hold with several executives of our HQ office, where I showed the GDCA previous month results of its various components: quantity of people, main projects trends, commitments previously made, new problems that arose, complaints from customers, costs, reduction plans, etc., one question arose again, which had already been raised in several previous meetings.

It was the evolution of our hourly cost rates, measured in dollars; and the deviation they showed with respect to the monthly and annual plans that had been committed at the beginning of that year.

Once again, and with a great deal of patience, I explained to the HQ financial executive that such a difference was due to the fact that the cost of living in our country was moving along a line higher than the depreciation of our currency to the dollar, and that this was absolutely beyond our ability to offset it.

His claim was that our salaries shouldn’t be following the cost of living, to which I explained, one more time, that it didn’t seem to be reasonable to me, and not only to me, but to all my reporting line within the country, including the GM.

It’s obvious the profound implication that this problem has in our country, given its very high inflation rate, much higher than that of any other of the countries in which the other GDCs were located. Not following the cost of living tren (compound 30/40% anual) means that every month people can buy less and less food and other very basic needs.

He didn´t say a word, but I ended that partícularmeeting with a very bitter taste in my mouth and a great sense of frustration.

The second event had to do with my comments during the above-mentioned phone call with the HR function within our New York HQ.

After that meeting and when the implementation of the new “Global Delivery Framework” (GDF) approach began to be made official in meetings with technical professionals from the different GDCs, this did not take long to become public among our employees and, as I have anticipated; it generated a deep frustration at first, and then a growing and uncontainable effervescence. It was not surprising then that towards the middle of the year, the most exalted employees decided to take matters into their own hands, provoking cuts and riots on the Panamerican Highway.

At the same time, and for the first time in the history of IBM Argentina, which was about to celebrate its 100th anniversary, some employees first threatened and then created a pseudo computer Union, a fact that took less than a second to reach the ears of our HQ.

My voice was not heard and, once again, I perceived the same bitter taste but this times, with a much greater intensity.

I looked to my side and realized, suddenly, that the two jars with the green and yellow paints that I had jealously guarded in a closet inside my office, had not been opened, although I had my serious doubts that in the short term, I would not have to do it. But I also believed that Jorge Ober, my mentor, who had given me that advice, in this specific case would have done the same as me and the walls and windows would have kept their original colors.....

On top of all that, by mid year we started to notice a sudden reduction in the quantity of working orders we were receiving, from both US and Europe customers, which caused great concern to the GDCA managers and, especially, to me.

It was obvious that something strange was going on with our Unit, but I didn't know exactly what it was, so I didn't hesitate to try to find out what it was....

Thanks to the contacts we had established between the executives of the various GDCs located in various countries, just two calls were enough to confirm my dark feeling. The work orders were still flowing normally to them; so the problem I perceived was unique to our country.

This was unfortunately confirmed a few weeks later at one of the regular workload planning meetings, in which one of our managers participated. At that meeting, the HQ representative formally announced that GDCA services would not be offered to potential new clients in any of the geographies for the time being.

That implied, in summary, that the tap of requirements to our unit was closed; that we had reached peak employee levels; that those leaving wouldn’t be replaced; and that we should prepare ourselves to start facing one potential downsizing; al lof that using mild and very careful terms to describe the situation.

One piece of good news came to balance a little of the bad news we had been receiving during the year, at least to end the year with a little more optimism.

In November we received the official news that the GDCA had won the Ibero-American Quality Award, a real pride for all of us and one that must have been for the rest of IBM Argentina's employees as well.

The award was to be presented during a Summit Meeting of the highest authorities of the Region, to be held during the month of December at the Provincial Hotel in Mar del Plata, including King Juan Carlos I of Spain.

The IBM Argentina GM, Guillermo Cascio, from whom we have received the greatest support since we started the GDCA, was not going to be able to attend because he was on a business trip abroad, so I was in charge of the small delegation that we were to integrate with my lifelong colleagues Ana María López, Jorge Osinski and Carlos Magariños, and we left for Mar del Plata.

The ceremony, the following morning, was very simple and in an annex to the main auditorium, where the Summit was taking place, and King Juan Carlos delegated the delivery of the award to the Iberoamerican Secretary, Enrique Iglesias, from whose hands I received the trophy, moved.

That very same night we returned with my three companions to Buenos Aires.

We had achieved the highest possible aspiration in terms of quality recognition in IT services at national and regional level, and that was no a small recognition, despite the fact that our HQ did not appreciate what it meant.

Days later, 2010 came to an end.

GDCA's population already exceeded 4,500 people, so, in addition to occupying the four buildings in Urquiza and Olivos, we had to partially rent another building, which was also located in Olivos, but on the other side of the Panamerican Highway.

I must confess that at that time I had mixed feelings.

On the one hand, I had the great internal peace of mind due to the results achieved, both in the size of our unit after only six years of life, as well as for the satisfaction that our clients always confirmed to us in general and, finally, for the last award that we had just received in recognition to the quality of our operations.

But on the other hand, unfortunately, my antennae were telling me that dense and very dark clouds were rapidly approaching the GDCA and I could not tell whether it was a passing storm or the universal deluge.

In the event that it was the latter I felt that, unlike what Noah must have sensed, I wouldn’t have the time required to build an Ark large enough to accommodate the 4,500 people who would be left floating adrift.

• Year 2011

I welcomed the new year in Villa Gesell with my wife, watching from the beach the fireworks that the vacationers had prepared for the occasion.

It was four days, during which I enjoyed the simple charm of our Buenos Aires coasts. I needed fresh air to clear my thoughts.

With the sensations just described at the end of the previous year, the new one began, and it was to be fateful for our beloved Unit.

The director to whom I reported, my dear Héctor Ortelli, had asked to leave during the last days of the previous year due to health problems.

Shortly after the beginning of the year, my most trusted manager, to whom I delegated the greatest responsibility for managing the GDCA whenever I was absent and who was also in charge of supervising its operations on a daily basis, my also beloved Carlos Menor, was to follow the same path as Hector.

That is how I found myself at the helm of the huge ocean liner we had created, in the midst of waters that were beginning to get dangerously rough.

It is fair to say that Sergio Santoro had recently joined our management team from another unit of the company, but he did not have the knowledge and experience of those of us who had had to deal with headwinds from the beginning of the project.

With Sergio's willingness and my misgivings about the events that were taking place during those days, we tried to keep the ship on its established course, but that did not last long either.

Through a call from our HQ we were informed that a new manager would temporarily take charge of our GDCA, while Héctor Ortelli was away. Sergio and I then asked ourselves: Why bring in someone from outside and not trust us? Although I was sure of the answer, I preferred not to share it so as not to make him and the convalescent Hector Ortelli and Carlos Menor bitter.

Immediately after this event, I was summoned by the HQ HR executives to a face-to-face joint planning session with several managers from other GDCs at the Somers building in New York, with the purpose of identifying different actions that could be implemented to improve the efficiency of the units we were in charge of.

I attended with my colleagues Ana María López and Jorge Osinski. Carlos Magariños could not join us as he would have liked, as he was on vacation. Once there, I was asked to assume the leadership of the session, to which, logically, I gladly agreed.

I calmly listened to the presentations made by the different CDGs and on the last day, while the attendees were having lunch, I wrote on a large sheet of paper that I displayed in front of the room, a fairly simple and effective criterion to rate the proposals that the small groups of the meeting had developed, assign scores and define priorities for their implementation, a task that was quickly accomplished by mid-afternoon, before we were all forced to leave the building where we were due to a heavy snowfall that had broken out in the last few hours.

The following morning, via telephone, the plans for implementing the proposals were formalized and the meeting was adjourned.

Great was my surprise when, upon my arrival in Buenos Aires, I received a call from the HR Management to express their disagreement for having used an evaluation criterion that had not been previously agreed upon, but something spontaneous and improvised (according to their words), which had arisen on the spot.

I mentioned its origin, as a backup, but I preferred not to continue the discussion. It was clear that my lack of adherence to the implementation of the Global Delivery Framework (GDF) was taking its toll on me.

The disagreements continued.

In one of the work team meetings that we usually had to review the operational problems that arose in the Unit and the actions taken, at one point the new manager, temporarily in charge of our Unit, began to make decisions that Héctor would never have supported, and I let him know in front of the participants.

It did not take me long to receive a clear order from the HQ, HR function to start deploying task standardization and downsizing, as one of the first steps of GDF.

We had to identify our employees and positions whose salaries and bands wou