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Davos Special Report January 17, 2008, 5:00PM EST

International Isn't Just IBM's First Name

(page 3 of 3)

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Big Blue, with 375,000 employees worldwide, used to focus on developed markets. Now it’s hiring fast in emerging countries, where many of the new employees perform services for global clients. Here’s a sampling of its staffing levels. Alberto Mena/BW

Payne, 48, immerses himself in the cultures of the countries where he's assigned. He learned Japanese for his Tokyo gig. When he arrived in Brazil three years ago, he promised to conduct all of his meetings in Portuguese within nine months. And he did.

Yet at the start Payne found that when resources were tight, Brazilians favored local customers, while IBMers from other countries pushed for their clients. The rule of thumb, Payne advised them, was to "think as if you're the president of IBM. What's best for the company long-term?" That reduced the conflicts.

Payne and other senior executives know that operating globally requires a great deal of hands-on management. In the old days at IBM, projects often were born and died within a single office building in New York State. These days, they're broken into pieces and farmed out to small teams worldwide.

To understand how IBM choreographs this dance, consider Lotus Symphony, a package of PC software applications. Work on a new version of Symphony started last July. Teams in Beijing; Austin, Tex.; Raleigh, N.C.; and Boeblingen, Germany, are all contributing. Remarkably, it's the first time ever that the Beijing team is heading up a global project. Having an important role is vital for attracting and keeping top Chinese programmers.

TROUBLED WATERS

It didn't sink in with the Chinese that they were actually in charge until five days after a test version of the product was released. The programmers were getting complaints about the software from testers and knew they needed to make improvements. They realized that they were responsible for the success or failure of the product. "The team had a Holy crap!' moment. They were just terrified," recalls Michael Karasick, a 48-year-old Canadian who runs the Beijing lab. He and the local Chinese managers calmed the programmers by setting priorities. The project is now on schedule.

One of the major challenges in this setup is the difficulty of communicating by e-mail or even videoconferencing when programmers have never met one another. Strangers don't readily share knowledge. "A big problem is trust," says Dirk Wittkopp, director of IBM's Boeblingen lab. "It works better if you can go out to dinner with somebody and have a beer. But we can't put people on planes to visit each other all the time."

So Big Blue is trying to bridge the gap with software that borrows heavily from social networking. A new program called Beehive is essentially a corporate version of Facebook. IBM employees create profiles and post photos, list their interests, and comment about company events or happenings in their private lives. Klaus Rindtorff, an engineer who works for Wittkopp, lists his five favorite places to revisit, such as Death Valley, Calif., and includes photos of IBM colleagues in Germany, Italy, and the U.S.

Another program, called Small Blue, is a search engine for finding experts within the company. The software scans employees' blogs, e-mail, instant messages, and reports, then draws conclusions about each participant's skills and expertise. When other employees search by topic on Small Blue, the program scans its findings to get a list of experts. Currie Boyle, an IBM consultant in Vancouver, used Small Blue to find a specialist for a Canadian client. His initial search turned up people in the U.S. and Europe, who in turn led him to an IBM staffer in Haifa, Israel, who had just the information he needed to help his customer.

Last month, IBM introduced a version of Small Blue called IBM Atlas for sale to customers. The company is positioning itself as a helping hand to other corporations who are taking similar paths to globalization. That puts extra pressure on IBM to succeed as a new sort of organization. If it thrives, that's good marketing. If it stumbles, that would be a very poor advertisement for itself.

Links

Temp Pipeline

Nike (NKE) calls it a "human-capital supply chain." Every year the shoemaker hires some 3,700 temporary employees—from electricians to programmers to marketers. And Nike has tapped Kelly Services (KELYA) to recruit and manage them, reports Workforce Management magazine. Expect lots of similar deals as companies turn more often to temps and contract workers, who now make up 12% of the U.S. labor pool.

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