Money talks – CFO in the saddle
Management gurus never tire of talking about the critical importance of executive buy in to the success of any project.
Celestica decided to walk this talk very early in Project One, said Kirk.
And how? “We made the chief financial officer the sponsor of the project.” Kirk suggested there were two reasons for this – one logical, the other pragmatic.
The CFO was the logical choice for the role of corporate project sponsor as ‘Finance’ is the biggest target group in Project One. It is also the group most affected by staff cuts from the process standardization that’s at the heart of the venture. “As sponsor, the CFO is both the patient and the doctor. He’s essentially operating on himself,” said Kirk.
The pragmatic reason for having the CFO as project sponsor has to do with what Kirk calls ‘way and means” control.’ “Essentially, it helps us simply turn off competing, disparate or non-consistent efforts.”
The Celestica exec noted that while IT manages and runs Project One, and “at least half of the work is IT-related, the IT department cannot impose the project on the entire company.”
De-scoping and the Power of ‘No’
Benchmarking key corporate processes was the first step in the Project One roll out, and according to Kirk, deciding what not to do was as important as identifying focus areas.
The goal, the Celestica CIO said, was to determine how to get his company’s internal operations (such as Finance, IT, Procure-to-Pay, and HR) running close to world class in their velocity, features and operating costs.
In the scoping phase, the Project One team received a volley of requests from various parts of the company. “We had this huge pile on effect,” Kirk said. “[People] would approach us saying: ‘please change this or change that.’ Eventually, we settled on just on a few things.”
It was the transformation of these few, but pivotal processes, that did the trick.
For instance, Kirk cited the example of the company-wide move to a common data warehouse. “That didn’t even have a cost associated with it; but it may bring the biggest long-term benefit to us, because [it ends] the needless duplication and replication of data across the company that was happening [before Project One].”
Responding to resistance – iron fist in a velvet glove
Kirk recalled initial opposition to various aspects of Project One. “It doesn’t matter where you start,” he said. “All change is [perceived as] evil.”
The root cause of much of the local resistance was a different perspective from that held by the Project One promoters.
“When you go to the man running your plant in Czechoslovakia (say) and tell him: ‘you need to change your processes to match the global processes’ – he’s pretty sure you’re wrong. He is not trying to solve the problem you (or your customers) have, which is how to achieve co-ordination of many different pieces around the world; or how to consolidate a balkanized patchwork of systems and processes to achieve better cost levels.”
When dealing with resistance, the Celestica executive says, one needs to have to have a huge respect for the problem, but not so much respect that you don’t force the change!
Talk of the town (hall)
The Project One town hall meetings Celestica held across the world provided a great forum – not just for handling resistance – but for communicating the project’s philosophy and getting valuable feedback.
Celestica has a name for these meetings: confirmation sessions. “Essentially you bring all those going to be affected into a room,” said Kirk. “There were several hundreds who attended in Europe and in Asia.”
He said the sessions got to be quite large, and that was inevitable. “Everybody has to have a kick at the cat. Because it affects their business, they will have questions about it.”
The sessions went far better than expected, and the dreaded massive push back didn’t really occur. “We were afraid it would turn from a Town Hall to a riot. But at the end of the day [our message] was very well received. I think [organizing these confirmation sessions] may have been the best single thing we did.”
With executive backing and the understanding and support of most of its stakeholders worldwide, Celestica was now ready to get into the “meat and potatoes” of Project One – and begin is fight against fragmentation.
What were the stakes in that venture? What pitfalls were to be avoided and opportunities seized? What would the outcome be?
Read about that in Part III of this series: The sweet sound of standardization or go back to Part I
