Several years ago, Chase Manhattan Bank embarked on an ambitious plan to develop a common back-office processing system for its overseas branches.1 The bank established at headquarters a cross-functional team of information systems, finance, and operations professionals to develop the design and lay out the implementation approach. Later, the bank added branch operations managers to meet “local” requirements. These managers retained their reporting relationships within their country organization structure, yet headquarters staff managed and evaluated their work on the project team. Conflicts were inevitable. After months of frequently fractious meetings, the headquarters staff prevailed, and a small group of branch managers reluctantly agreed to support implementing the new system on a pilot basis. Because the team concentrated on reconciling differences rather than on understanding similarities, the project was extended over several years. Ultimately, the bank achieved its objective of operating on a common infrastructure, but at high political, human, and competitive costs.
When facing a similar need, a large Korean chaebol took a different approach.2 To achieve its objective of global expansion, during the past decade the company focused on building production and marketing capabilities in many diverse geographies. Developing management control and reporting systems was lower priority and was principally the responsibility of local staff in each country. Under pressure... To read the complete article, login or sign-up using the form below.
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