Put the Right People on Your TeamOr ElseBy Anna Maria Virzi Print
When acquiring a new company, size up talent fast. Keeping dead weight will only pull you down.
AGCO, which makes tractors, combines and other agricultural equipment, is relatively new. Since AGCO was founded 14 years ago it's acquired 20 companies, including Valtra, a Finnish tractor and engine maker, as well as the farming equipment business of Caterpillar.
With each acquisition, a company inherits processes, systems and people. From an information-technology perspective, you must make these resources work together without upsetting the business. AGCO has accomplished this.
The critical first step: Deciding whom to put on your team to manage the integration of the acquired business and its processes, systems and people. You must balance the interests of different companies before you get going, as well as assess the strengths and compatibility of individuals from both the existing organization and the new company.
Where did I begin? I would meet with the manager of information technology at the acquired company. Together, we reviewed what he was doing. Then, I drilled down and started talking with some of the people who worked for that manager, as well as the people inside the company who used technology for their day-to-day business. Some of my direct reportsI had 10 of themdid the same thing.
I would ask the business executives of the acquired company about its information-technology leadership: "What are you getting and how much are you paying for information technology? If these were your dollars, would you pay your I.T. manager to do this for you?"
If the business executives answer yes to the second question, the top information-technology manager is a winner. If they tell you that the manager is not doing his job, or if they would rather go outside the company to get the work done, that manager probably does not belong on your team.
Hopefully you can figure this out early. You don't want to keep someone on your team who is not pulling his weight. If you do, you invariably end up hurting your business.
When I joined AGCO, the company didn't have a centralized information-technology department. I was the first CIO.
We realized early on that we needed to integrate financial reporting so executives and investors could get consolidated financial reports in a timely manner. Yet no one was using the same enterprise resource planning system, much less the same version. For example, AGCO was using SAP in Germany, J.D. Edwards in the U.K. and France, and Cincom, American Software, Mapics, GEAC and other software elsewhere. It also had disparity with its hardware platforma lot of IBM AS/400s and mainframes. We were using HP-UX in Brazil, Sun at the headquarters in Duluth, Ga., and a lot of Intel.
It's interesting: Everyone was always doing the right things, just doing them in a slightly different way. For instance, since the companies were very autonomous, each got direction from the local site for the local site, with no commonalities. Our Hesston, Kan., operations were focused on radio-frequency identification. Our systems in Brazil were running out of capacity. Our headquarters team wanted to implement a North American financial system and looked at Sun instead of taking a global view and inventory of our hardware platform for the future.
These are all proper things to do to support a local organization, but certainly not a worldwide plan and vision to support a growing enterprise.
To determine what our standard systems should be, I found experts in particular systems or technologies, such as manufacturing and engineering, and hired them as my direct reports. Those experts, along with the rest of my team, then established best practices and helped standardize our approach across our global businesses. That made our organization more effectiveand trimmer. In 2001, we had over 350 employees in information technology plus about 60 consultants. Two years later, we had 233 employees and about 10 consultants.
Jose M. Marrero was CIO of AGCO Corp. of Duluth, Ga., from 2001 until August 2004. He has also held executive management positions at Delphi Automotive Systems, GE Capital Fleet Services and 3M. He can be reached at firstname.lastname@example.org.
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