Claude Philipps is not a happy man.
He’s standing in the middle of a sea of cubicles at the headquarters of the Athens 2004 Olympic Games Organising Committee, the group responsible for putting on the Summer Olympics this month.
There are 85 days left until the games begin. Philipps is the guy whose job it is to ensure that the entire technology infrastructure for the Athens Olympics is in place before then. He has just learned that a key network connection from the primary data center to the backup center elsewhere in Athens hasn’t been set up, and he’s steamed. He’s speaking English, but it might as well be Greek for all the acronyms. “Look, let’s talk to ATHOC” — that’s the Athens 2004 Olympic Games Organising Committee — “or let’s talk to the IOC” — that would be the International Olympic Committee — “or let’s talk to whoever we need to talk to,” Philipps tells one of his managers. “But let’s get it done by Monday morning, or I will raise hell.”
Philipps has reason to dial up the heat. The French native leads a systems-integration team of Atos Origin, an IT company based in France and the Netherlands, which wrote the software and is installing much of the hardware that will run the games. Atos technology will issue credentials to 200,000 athletes, judges, coaches, and media reps; it will collect and distribute every scrap of data about timing and results; and it will make sure hackers or technical snafus don’t disrupt the competition.
The Atos Origin team that Philipps heads is nearly as multiculti as your average Olympic village: It’s made up of 280 people from 23 countries. And Philipps himself is a globe-trotter extraordinaire. He moved with his family from Salt Lake City to Athens in 2001, and from here he has been traveling to Turin, Italy, and Beijing to help with preparations for the Olympics in 2006 and 2008. The day after the Athens games end — literally, on August 30 — Philipps will pick up and move to Turin with his wife and teenage son for the next Winter Olympics.
After a dozen years and five previous Olympic Games, Philipps and Atos understand more about what it takes to succeed as a global business than most companies that boast about being “borderless enterprises.” Collaborating across time zones, geographical distances, and cultural chasms is second nature to Atos. It’s just the air that Philipps and his colleagues breathe. That kind of global fluidity — rising above the jet lag and language differences to make things happen — is quickly emerging as an essential (but rare) competitive edge.
“No matter what kind of business you run, no matter what size you are, you’re suddenly competing against companies you’ve never heard of all around the world, who make a very similar widget or provide a very similar service,” says Harold Sirkin, a senior vice president at the Boston Consulting Group and the head of the firm’s global operations practice. “It’s more of an imperative to be global, and to be smart about it, than it’s ever been before.”
Global all-stars like Atos, GE Healthcare Technologies, and Plantronics, the world’s largest maker of telephone headsets, aren’t global merely because they’re chasing low-cost labor, or even because they’re trying to gain entry to new and fast-growing foreign markets. Instead, they’re building webs of talent across the world so that they can design better products, solve problems faster, gain more control over manufacturing, and benefit from creative people no matter which countries’ passports they carry.
I traveled halfway around the world — 17,777 miles — over 30 days, to meet some of these transnational teams and to see first-hand how this new approach to global collaboration works.
The world’s most advanced CT scanner is parked inside Bay 56, a lead-lined testing room at GE Healthcare Technologies headquarters here. Outside the room, a team of GE engineers led by Duane Filtz is trying to iron out the last few kinks. It’s 8:45 on a Wednesday morning in early June, and this first-of-its-kind scanner, known as the LightSpeed VCT (for volume computed tomography), is due to be shipped out on Saturday to Froedtert Hospital & Medical College across town, installed on Sunday, and producing images of patients on Monday.
The dozen people standing outside Bay 56 are all wearing protective lab glasses, and they’re staring intently at clipboards, or the “Hot Issues” list perched on an easel. “We’ve got lots of tests to get through by the end of the week,” Filtz says. “We had some scan aborts yesterday” — when a test scan stopped inexplicably — “and we need to get the fixes for those into the software.” There will be another meeting at 4 p.m. today to review the day’s progress.
When it goes into production later this year, the $2 million LightSpeed VCT will be the fastest and highest-resolution CT scanner available. It can scan the entire body in less than 10 seconds, gathering 5 gigabaud of information a second, and can capture a three-dimensional image of a patient’s heart in five beats.
As technologically advanced as it is, the LightSpeed VCT also represents business innovation: It is a truly global product. The machine was designed with input from cardiologists and radiologists around the world. Its electronic innards were designed by engineers in Waukesha, in Hino, Japan, and Buc, France. Parts of it, including the mechanized table on which patients lie, will be made in Beijing and Hino. Much of the software to run the machine and interpret the images was written in Bangalore, India; Haifa, Israel; Buc, France; and Waukesha.
One way to make distant offices collaborate: Skimp on resources. “If they all had everything they needed, they’d wind up competing.”
Managing such a global enterprise can be almost as complex as the scanner itself. “It’s definitely a double-edged sword,” admits Brian Duchinsky, general manager for global CT. “If we sat around in this cornfield west of Milwaukee, we wouldn’t come up with the same breadth of good ideas. But yes, getting six countries on the phone to make a decision can be a pain.” Duchinsky has almost daily conference calls that start as early as 6 a.m. and can go until 9:30 p.m.
It’s necessary, though. The market for a device like the LightSpeed VCT is global, and that means GE must start with an awareness of what global customers want. Sholom Ackelsberg, a research manager, is responsible for talking to doctors around the world to understand what sort of diagnostic tests they’re eager to perform with a new scanner. He has advisory boards in the United States, Europe, and Japan, and is assembling one in China. “We ask them about their unmet clinical needs,” Ackelsberg says. One was being able to do something called the “triple rule-out” in a single scan: assessing the three big dangers — a clogged artery, torn aorta, or pulmonary embolism — for patients who show up with chest pain.
Ackelsberg also hunts for information about more mundane regional differences. American patients are heavier than those in most other countries and require a table that can carry the load. In France, clinics sometimes do more than 80 scans per day, and engineers need to ensure that there won’t be a bottleneck in processing the images.
While the CT group has long had international units, they were hardly an integrated global operation before 2000. The overseas offices each worked on their own products, with the Waukesha team focusing on high-end scanners, Hino developing the midrange, and China working on the lowest-priced machines. Each group created its own technical architecture.
But by 2000, GE saw that rivals such as Siemens, Philips NV, and Toshiba were moving faster, says Bob Armstrong, general manager of engineering. If GE wanted to stay in front, it couldn’t afford so much complexity and duplication of effort in its three engineering locations. That meant getting Japan, the United States, and China to collaborate with each other, and with the software groups in Israel, India, and France. “We wanted better designs, faster, and we wanted to accelerate the cost reduction,” says Armstrong.
He adds that one of the ways he has forced his disparate offices into closer relationships is by intentionally leaving them slightly short of resources. “If they all had everything they needed, they’d wind up competing with each other,” he says. “It’s Machiavellian, but I make sure neither team has enough people.”
It’s 5:10 p.m. Back in Bay 56, the activity hasn’t slowed. Technicians are trying to get rid of a few final image-quality problems, sending test objects called “phantoms” through the scanner — they look like birthday cakes made of Lucite — and calibrating it based on the results. Engineers in Japan, who have one of the four LightSpeed VCT machines built so far, are reporting the bugs they find to a common database that’s shared by Hino and Waukesha, along with the rest of the company. A new version of the software that runs the scanner is expected to be done by 7 a.m. on Thursday; one out of every 40 or 50 scans is still aborting without capturing any imagery.
In theory, Armstrong is on vacation today — earlier he helped chaperone his son’s school trip to an amusement park — but he didn’t want to miss his weekly 7:00 p.m. teleconference with his team in Beijing (it’s Thursday morning there), which is getting ready to start producing a new scanner. He’s in his office, finishing a Chinese takeout dinner. At 7:04, an instant message flashes on his laptop: “Bob, can you call in?”
He dials into the teleconference and pulls up an internal Web site called eNPI (the NPI stands for “new product introduction”). He leans in close to the speakerphone, and at times covers his eyes to focus on the Beijing team’s heavily accented English. He also notes when they seem to misunderstand something, jotting down a reminder to follow up via email.
He seems a bit disappointed that the Chinese team hasn’t yet scheduled a time for engineers from Hino to come over to evaluate their progress on the new scanner. “In China, they’re young and hungry,” he says later. “They don’t want to be reliant on anyone else.” He tells the Beijing team that time is short and that they’ll have to start leaning on their colleagues in the United States and Japan. “If there is a point where help from Milwaukee or Hino would solve a problem, ask for it,” he says. “There’s no shame in asking for help.” The call lasts about 40 minutes.
“There are smart people everywhere in the world,” Armstrong says. “Cost may be what gets you to open up an office somewhere, but you need to get beyond that and understand what advantages your people there can bring. You want to hear their different approaches to a problem. Frankly, I don’t want to lose that diversity and wind up with everyone thinking like Milwaukee thinks.”
There are 14 different steps involved in assembling one of Plantronics’ MX150 cell-phone headsets, but trying to follow each step as headsets fly from one worker’s station to the next here at Line #4 is like trying to see a single flap of a hummingbird’s wings. The $30 MX150 is a very hot product — one of the most popular cell-phone headsets on the market since its introduction last year — but that’s not so hot for Plantronics. Although the maquiladora here in Tijuana produces 230,000 MX150s each week in three shifts, Plantronics is still puffing to keep up with demand.
Hiring is proceeding at a breakneck pace, says Rosa Ruvalacaba, who oversees MX150 production at Plamex, the Plantronics facility here that the company has operated for 32 years. “We added the shifts for the MX150 in April,” she says, “and since then, we’ve hired 600 new people.”
But staffing up quickly isn’t the only challenge that springs from having such a hot product. Plantronics sells a million MX150s a month (nearly three times as many as it was selling last year), and wireless carriers such as Verizon continue to increase their orders. That has pushed Plantronics to try to cajole suppliers in China to bump up the number of parts they send to Plamex. Some 50,000 cable assemblies, which include the jack that plugs into a cell phone, and the cable itself, arrive each day at Plamex, five days a week. But it’s not enough, and that’s forcing Plantronics to get even more global.
“It’s hard to tell when a product is going to take a run on you,” says Terry Walters, senior VP of operations, who works at Plantronics headquarters in Santa Cruz, California, but travels to Tijuana at least monthly. “When the consumer headset market exploded in 1996 and 1997, that created a lot of spikiness for us in terms of orders. And since a lot of our suppliers are in Asia, it’s sometimes hard to get them to react quickly enough. They have other customers and other priorities, and right now the economy’s expanding, and everyone’s trying to buy the parts that we’re trying to buy.”
Plantronics, a 43-year-old company that made the headset that Neil Armstrong wore when he landed on the moon, already has major operations in the United States, Mexico, Great Britain, and the Netherlands. It has offices in Taiwan and mainland China to prepare engineering drawings for suppliers, and to check on the quality of their output. But by this time next year, the company plans to open its first manufacturing facility in mainland China, in an industrial park in Suzhou, 60 miles west of Shanghai.
Part of the Suzhou strategy involves cost: Walters believes that Plantronics can improve profit margins by making its own cable assemblies and plastic parts. But the main goals are speed and flexibility. “We want to shrink the supply chain,” Walters says. “Instead of having a 10-week lead time when we need to increase production at Plamex, I’d like to get to one week.”
Shrinking that lead time will let the company adjust more fluidly to sudden surges in orders. “There are lots of ways you can respond to unpredictable demand spikes,” says Lyndall Fry, vice president of quality. “We don’t want to respond to those spikes with excess inventory and buffer stock — that’s not what flexibility means to us.”
Fry speaks German, Spanish, English, and French, and she’ll soon be learning Mandarin. On her business card, she has had her Chinese name stamped in red: “Fu Ling.” It means jade, and has the connotation of “bringing prosperity,” she explains. It was picked out for her with the help of a Plantronics colleague from Taiwan; Fry has since given the whole team Chinese names. She seems to thrive on immersing herself in new cultures. For her last job, at Siemens in Germany, she learned German from scratch.
Plantronics will break ground for the factory in the fall, along with a 1,000-resident apartment building nearby. In Suzhou, it’s customary to provide housing for workers, and by offering apartments with air-conditioning, a laundromat, a minimart, a cafeteria, an entertainment center, and 24-hour-a-day hot water (a luxury for the region), Plantronics hopes to keep a lid on turnover. At the factory, there will be covered parking for 1,000 bicycles.
But why go to all the trouble? Why not just try to forge closer ties with local suppliers? “It’s easier to control quality when you own the manufacturing process, rather than trying to influence someone else’s process,” Fry says. “If you own the equipment, and the employees work for you, you can find improvements and enhancements as you go. You have better relationships with the suppliers of raw materials, because you’re part of the network there, and you’re invested in the community.”
Suzhou isn’t the only place Plantronics is increasing its presence. Consumer headsets like the MX150 represent nearly 25% of its overall revenues, up from almost nothing 10 years ago. And consumers are much more fashion-conscious than the pilots and office workers who once were Plantronics’ core customers. So its designers have been spending more time in fashion capitals like Paris and Milan, creating concept drawings of futuristic headsets to explore different designs. The global pulse checking and global sourcing fit neatly together: The aim is both to get a better handle on what customers around the world want, and to do a better job of giving it to them. “We have a saying here: ‘Sell all you want, we’ll make more,’ ” Walters says. “We need to make sure that we can always say that — and mean it.”
Even in May, with three months left until the opening ceremony of the Summer Olympics, the ATHOC headquarters throb with the intensity of a college campus during finals. The average age of an ATHOC employee seems to be in the mid-twenties. The corridors bustle with traffic, and everyone is fueled by tall glasses of coffee frappe, a high-octane blend of Nescafe instant coffee, water, sugar, and milk, served cold. ATHOC is situated in Maroussi, a suburb about five miles from the city center.
In the midst of this sea of activity, the Atos Origin team doesn’t seem at all addled or agitated. That’s probably because a company Atos absorbed worked as a subcontractor to the Olympics in the 1992 Games in Barcelona; it then took the lead role for the 2002 Winter Olympics in Salt Lake City.
By contrast, you can’t blame the Athens organizing committee members for hyperventilating. These are the first, and the only, games they’ll ever be involved with. So one of the challenges for Atos is to bring local expectations down to earth. “The local organizing committee always wants to put on the best Olympics ever,” says Philipps. “Their IT director always comes in with brand-new sexy ideas. We say, ‘The technology has to be low profile. These aren’t the Games of Technology. We just have to make sure it works.’ There’s a six-month phase to get that understood.” Atos aims to reuse 90% of the software it has developed for previous Olympics, because that technology has been tested and proven — and because it’s cheaper than writing everything anew.
Philipps’s cell phone rings every seven minutes with someone presenting him with a new problem or question. Sometimes he answers it in English, other times in French. Philipps also speaks German and Spanish, and he’s picking up a little Italian as he begins to work on the Turin games.
This week, Philipps has overseen the delivery of a new software release developed by Atos programmers in Barcelona. (There are regular Tuesday conference calls with the software developers there, some of whom will be in Athens during the games, and some of whom will stay in Spain in case any last-minute software patches are needed.) His team has been taking apart a test system used over the weekend for a mountain-biking competition, and setting up a test system at the still-unfinished main stadium for a track-and-field event this weekend. (These pre-Olympics competitions are held to work the kinks out of the newly built sporting venues.) On Friday, there is a major meeting with representatives of the IOC’s technology oversight team. The second — and final — technical dress rehearsal is approaching, when 60% of the systems for the games will be tested at the actual venues.
Inside a room known as the “temporary technical-operations center” (the actual technical-operations center is still being outfitted, across the hall from the temporary one), Philipps sits at a computer for a few minutes, checking to see that there are no problems requiring his attention. He pops up and goes over to chat with Jam Mulcare, the integration lab manager. Mulcare, a native of the British Virgin Islands, will act as a kind of air-traffic controller for data during the games, making sure that it flows smoothly from place to place. Peter Hamilton, an Aussie who joined Atos after the Sydney Games, is in charge of the system that will provide data to broadcasters. It must work flawlessly: At the peak of the Olympics, there will be 19 venues up and running, and Atos’s systems must be available 24-7, since the media will be reporting around the clock.
Philipps’s Atos team in Athens is made up of a mix of Greeks and other nationalities from around the world; the tech teams in Turin and Beijing will similarly include a number of locals. They’ll help Philipps understand the culture, language, and work habits of the local organizing committee. “Even with all of the Olympic experience we’ve had,” he says, “the cultural thing makes a huge difference, because 95% of the people you will work with are local.” And they all have different styles. “When we did Salt Lake City, the Americans like to have a lot of meetings, talk a lot before making a decision. People there like to have consensus, to make decisions in common.”
“In Greece, you have a much stronger hierarchy,” Philipps continues. “You cannot get a guy to do something without his boss agreeing. Which can be more efficient, or it can be more bureaucratic. In China, I’m still trying to understand how that will work, how I’ll have to adapt. In every country, you find that ‘yes’ means something different, ‘maybe’ means something different, ‘I’ll do that right now’ means something different. Your management style needs to change.”
Few managers are so adaptive, and few companies can parachute into a new country every two years and set up a vast, complex, and vital operation; at Atos, that’s just the way business is done. And it’s worth it. While the games aren’t Atos’s primary profit source, they are an opportunity to showcase its abilities all over the world. “What we do is like the circus,” says Santiago Codola, a manager who works in Atos’s nerve center in Barcelona. “You move from place to place. You have a short time to prepare, and you have to make the show look like the best in the world. Then you move on.” Next stops for this global circus: Turin and Beijing.
Fast Take: The Globe-Trotter’s Guide to the Galaxy
A rule book for global execs is a bit of a contradiction in terms, because listening and flexibility are key. But here’s what some time-zone itinerants have picked up in their travels.
- “State visits” — those fly-in-fly-out formal calls on overseas facilities — tend to be a waste of time. So says Harold Sirkin of Boston Consulting Group. What you’ll get is a show and a handshake, not a real feel for real problems.
- Frequent teleconferences beat infrequent videoconferences. “And when you schedule conference calls, you should share the pain,” says Claude Philipps of Atos Origin. “Don’t always make the team in Barcelona wake up at two in the morning.”
- Use technology that supports “presence detection” — instant messaging, for example — to tell you when a colleague is or isn’t available. Terry Walters of Plantronics swears by Skype, software that supports voice conversations over the Internet: “You can see who’s online and who’s busy,” he says.
- Make sure regular teleconferences or videoconferences happen at a regular time and day. “That way,” says Walters, “if you need religion, you can be there. It’s like going to church.”
- Don’t expect tight bonds among team members who collaborate only via teleconference, email, and instant messaging. “You need to get your people together in one place if you want them to really appreciate how good everyone is, and how good you are as a team,” says Bob Armstrong at GE Healthcare Technologies.
- Pick a system for Web collaboration, and stick with it. IBM Lotus’s QuickPlace, Groove Networks’ Workspace, and other systems all have their relative merits. But the level of participation drops sharply when companies switch from one system to another.
- English may be the de facto language of global business, but efforts to speak like the locals can help build stronger bonds. “At our Christmas party in Mexico, I give a speech in Spanish every year,” says Walters. “I rehearse it pretty carefully. I haven’t yet given speeches in Chinese, but I will.”
Sidebar: Staying Aloft
John Leahy, 54, may be the world’s most frequent flier.
As the chief commercial officer of Airbus, Leahy oversees more than 500 sales and marketing personnel in Toulouse, France — where Airbus is headquartered — plus Sydney, Tokyo, Beijing, Hong Kong, Dubai, and the United States.
He travels 200 days a year and still manages to return to Toulouse for the weekly management board meeting. “All my relatives use my frequent-flier points — and I’m not running out,” he says.
One week this spring, he left Toulouse on a Saturday to fly to Sydney, where he met with Qantas executives about a low-cost airline they’re starting and had dinner with the CEO of Air New Zealand to talk about a potential order. On Tuesday, Leahy flew to Singapore for meetings with the heads of Value Air and Singapore Airlines. Wednesday night, he flew back to Paris for a Thursday shareholder meeting of EADS, the French company that owns 80% of Airbus. Friday morning, he left for Miami to have dinner with the president of Lan Chile Airlines. Saturday morning, he flew to El Salvador for the funeral of the president of that country’s airline. He was back home in Toulouse by 5 p.m. on Sunday.
Leahy, no surprise, is a firm believer in the power of personal presence. “Videoconferencing is overrated,” he says. “Trying to sell airplanes requires a lot of face-to-face contact.” Especially if it’s the Airbus A380, with a price tag of $280 million. “It’s hard to say over a videoconference, ‘No, what you’ve heard from our competitors about the price of Airbus spares isn’t true,’ ” he says. “You’ve got to be in front of the guy for hours, sometimes days on end.”
Leahy’s Rules of the Road
- Stay focused on what you’re flying in to accomplish. The travel itself can distract you from the reason you’re traveling, he says.
- “Try to exercise whenever possible. Even if you can just run in the hotel gym for 30 minutes, you get oxygen into your blood and your body starts to acclimate.”
- “The worst thing you can ever do when you arrive somewhere is take a nap in the daylight hours. Just don’t do it.”
- Leahy says he couldn’t live without his GSM phone, which “rings in my pocket no matter where I am in the world, be it Beijing or New York.” He leaves the phone on night and day. “I might yell at the person for waking me up, but that’s better than losing a deal because I didn’t answer.”
Scott Kirsner is glad to be back home in Boston.