Going Global is a Long Journey

AES's power to the people philosophy goes over better in some countries than in others.

Does "power to the people" translate smoothly into different languages, cultures, economic histories, and religious values? In fact, AES's practices have translated better in some places than in others. The company has had great success in Brazil, a country that's weathered dictatorships, bureaucracies, and rampant inflation, "We've had to change to survive," says Carlos Baldi, manager of the Santa Branca facility. "We've had seven currencies in the last 10 years. Brazilians are willing to try something different. There's no safety in sticking with the norm."

That's not the attitude in Northern Ireland. In 1992, the company teamed up with Tractebel, a Belgian utility, to purchase two power plants - one in Kilroot and one in Belfast. The joint venture, called NIGEN, is a financial success. But it has been a cultural struggle.

"There is a fear of relinquishing control," says Mel Bacon, who has spent more than 23 years at the Belfast plant. "Let's say you have someone who's worked his way to the top of the company. Suddenly he's on the sidelines. He can't call the plays. It's frustrating."

AES dispatched a U.S.-based employee, Chris Hollingshead, to transplant its values. When one generator experienced an outage, for example, Hollingshead suggested that managers vacate the facility while workers got the turbines back online. "I got the message," says Bacon. "But I felt that the best people to manage the work were being taken away." The repair went without a hitch; Bacon began to see the light.

But old attitudes die hard. When operators suggested replacing an expensive steel pipe with an inexpensive plastic one, Bacon resisted. "I feared that the plastic pipe would last only a few days," he says. But the operators were convinced that plastic would do the job. "So they put the pipe in," says Bacon. "That was a year ago. It's showing no signs of wear."

Bacon calls the incident a "big 'aha' for me." But not everyone shares his perspective. Some of his colleagues "fear that if you relinquish control, you're no longer required." A big factor in their fear, he adds, is that the plant didn't just have to change - it had to shrink.

When Hollingshead arrived in Belfast, the 356-employee plant was woefully overstaffed. He suggested that management announce one big layoff and then mold the people who remained into a tightly knit team. But he left the final decision up to NIGEN's leaders. They chose a voluntary-severance program instead.

Many workers declined the package, which forced management to devise other offers. "Every time another scheme was launched, there was a feeling of dread," says Bacon. The necessary workforce reduction (to fewer than 100 employees) is now complete. "But it took five years to get to that number," says Bacon.

The AES way has sunk in at Belfast - slowly. Too slowly for CEO Dennis Bakke, who has reviewed the plant's most recent values survey: "The managers just didn't trust the workers enough to turn over power," he says.

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