OD Session 6: John A. Clendenin/ Xerox Case
Introduction (from John A. Clendenin Case):
Clendenin’s father was black army officer then draftsman in aviation industry, mother was from Germany In 1960, father lost job and Clendenin was moved from Long Island to Queens to get welfare; was in culture shock and had to fight for themselves Went to Brooklyn Tech, a special city high school then to State Univ. of NY in Fredonia Tried to change habits, made varsity cross-country team and was placed in scholarship Majored in childhood education and socially active, became kindergarten teacher in Bronx Enlisted in Marines a year later, progressed through the ranks and realized that he was smart and athletic as anyone else Left marines in 1982 to attend FECBUS when he was 33
Elected section education rep, clear about learning more about power, politics and corp. culture Job search was “different” because of age but worked for Xerox for the summer as productivity consultant then returned after graduation in 1984
Clendenin’s boss proposed a lateral move from head of Xerox’s Multinational Development Center (MDC) to a staff support function Since taking over MDC in 1986 Clendenin had been behind the growth and success of the department; budget grew from $400K to $4M, staff from 4 to 42 However, this had also created resentment among those who hadn’t gotten additional resources, and he was concerned that the proposed move would be seen to those as “moving off the fast track” He also had the option of staying another 2 yrs as head of MDC, but wasn’t sure of the implications
Clendenin’s Early Career at Xerox
He did his summer at Xerox in 1983 as a productivity consultant in the U.S. Marketing Group (USMG) working on two projects (resolving overpackaging in distribution and saving by having vendors ship directly to end users in Xerox), both of which were highly successful He decided to return to Xerox because he was comfortable with their culture of having an “order” to things
He returned as same position as in the summer, then got promoted to administrative mgr. for the parts and supply area in Dec. 1984 Although he was successful, there were difficulties because at first the old guys wouldn’t listen to him and then because he was too successful for other guys to challenge him However he managed his relationships with older, more experienced guys by creating “win-win” relationship (marketing bingo, anyone?)
Clendenin Discovers Multinational Logistics
The Multinational Systems Development Center (MSDC) was a small subunit within the U.S. parts and supply systems group, responsible for developing and maintaining systems that would allow the logistics and distribution operations within each of Xerox’s worldwide operating units to communicate with each other Clendenin felt MSDC was out of place; it had become part of U.S. organization in 1981 when its original home, corporate logistics had been disbanded In line with CEO Kearns’ view that increasing ROA was major objective, Clendenin believed MSDC could make substantial contribution.
However, this would require redefinition of MSDC’s tasks to coordinate the development and implementation of any changes worldwide Clendenin initially did not have support within the USMG to take this new multinational approach, because the interests of individual mgrs were not aligned with Xerox’s objectives. Thus, to get a mandate for MSDC’s new mission, he contacted senior mgrs in the Corporate Information Systems Board (CISB) Elstein, a senior corporate information mgr served as a liaison to CISB, and Zivan, the head of USMG logistics and distribution organization, wanted Clendenin to work with him to create the new business process The proposal by Clendenin and Elstein had 3 organizational components;
(1) a multinational distribution steering committee chaired by Zivan, composed of VPs for logistics and distribution for Xerox’s worldwide operating units, would set an overall strategy for multinational distribution) (2) a multinational working group composed of mgrs from the operating units at level of Ketchem (Clendenin’s boss), would flesh out strategies of (1) with detailed implementation plans (3) a Multinational Development Center (MDC) identify promising opportunities for improvements in multinational logistics mgmt. for the steering committee, continue to be responsible for developing and maintaining multinational logistics computer systems
After getting CISB’s approval for the plan, Zivan wanted Clendenin to be the director of MDC and to report directly to him – more promotion for Clendenin!
Building the MDC
While this was a promotion, Clendenin was head of a small group with no formal authority, no headcount, and a small budget. To increase his budget, he had to save at least as much for Xerox U.S., regardless of how much he saved worldwide However Clendenin leveraged his position as a secretary to the multinational steering committee, and eventually when members returned to their organizations with productivity improvement agendas they realized that Clendenin’ group could complete these projects better than they could (and also more economically) More opportunities for Clendenin’s group meant more headcount, but it was not always easy to get members of the multinational committee to agree to fund anything beyond computer systems development work To address the animosity and friction generated when MDC’s budget was increased, Clendenin tried to maintain a delicate balance by maintaining a lower profile, using “we” instead of “I”, and having everyone cooperate with each other without really noticing that Clendenin was pulling the strings
Staffing and Managing the MDC
One of the challenges for Clendenin was identifying and recruiting appropriate people to join his organization; this was not easy because the kind of people he wanted were the kind of people other organizations wouldn’t let go Thus Clendenin developed a screening process of multiple interviews by multiple members of the MDC, so he could seek out individuals who were intelligent, motivated, caring and team players but were hurt by the fact that Xerox was such a close-knit society (i.e. one badmouth can kill you) “The quality of your attitude is as important as the quality of your work”; he had additional appraisal forms for his group which helped him spot potential problem relationships on the top team He felt that the workplace should be conducive to helping employees achieve what they want; encouraged community activities as long as they were getting the stuff done “Leadership involves the ability to create and manage tension, but be approachable” How others saw the group; diverse and good (Xerox mgr.), pleased with how they were treated (customers), hard to see concrete results to justify the x5 growth (user)
Comments about Clendenin as a Mgr
His mgmt. approach elicited strong reactions from those who worked within MDC: Building trust and managing conflict:
Clendenin uses psychological skills but don’t feel it’s manipulative because it’s genuine, trust him to do the right thing for MDC, he has a strong reputation, gets trust from people with whom you are in conflict with Motivating, developing and goal setting:
doesn’t give negative feedback, reinforces positive behavior, hard but makes you think he’s soft, lets managers take outside risk and stand behind, painful but growing experience to work with him, tying manipulation with coaching, stress giver Creating MDC climate:
treats seniors same as juniors and everyone understands this, develop team by overlapping job responsibilities so bonding occurs Managing Clendenin:
Clendenin lives on the edge, broadens your mind, forthright
Organizational Changes Affecting the MDC
Xerox increasingly focused on efficient use of corporate assets, and the scope of issues considered by the multinational logistics steering committee broadened In 1987, Zivan retired and Pipp (president of Diversified Business Group and chair of Return on Assets task force) took over as chair of steering committee Pipp added representatives from corporate mfg. to committee and enlarged its focus to improving the overall mgmt. of inventories throughout Xerox’s operating units From Jan. 1987 to 1988 following Zivan’s retirement, Clendenin reported to 4 different members of the steering committee from different parts of the USMG – was never clear who should take organizational responsibility for MDC, a multinational organization within a U.S. subsidiary In spring 1988, staffing cutbacks were announced for USMG.
Clendenin felt it was not fair for MDC because it was multinational, so with assistance of Pipp he moved MDC into Corporate Information Mgmt. Group In fall 1988, Pipp (approaching retirement) had Hewitt (another steering committee member) replace him as committee chair. Hewitt had been pioneer in developing multinational systems in Europe, and was serving as director of distribution and technical services for Rank Xerox, Xerox’s European arm. Hewitt was also named to newly created VP of logistics and asset mgmt., reporting to 3 of Xerox’s senior line mgrs. According to Hewitt, reasoning behind new organization was to get across that Xerox was a line organization vs. corporate staff. “Tell us how to run logistics and asset mgmt. in such a way that we can get the benefits of globalization.” Xerox pushed to increase ROA from 10% (1988 level) towards 15% (objective set by CEO Kearns for 1990) In Nov. 1988, MDC was transferred into Hewitt’s organization. Hewitt created 3 staff positions for mgrs to work with him in developing strategies for improving the multinational mgmt. of logistics and assets.
After a few months Hewitt decided that rather than fund MDC with up to 50 separate agreements, he would negotiate fundings directly with 3 senior line mgrs. He also made clear that MDC needed to redefine its mission to return to being just an information systems and maintenance group In line with this more modest objective for MDC, its budget was cut back from $4.3M to $3M, and headcount was reduced by 3
Clendenin and Hewitt had considered some possible next steps in Clendenin’s career such as mfg. or marketing, but had not agreed on timetable. Possible replacements for Clendenin were also discussed but undecided Blohm: mentioned by Hewitt, mgr. from Corporate Information Mgmt. function, skilled at getting computer systems completed on time and within budget, but Clendenin not sure because MDC’s relations with CIM had been strained at times Gunnin/Thomas: mentioned by Clendenin, two direct reports to Clendenin In March 1989, Hewitt offered him the option of becoming his 4th mgr. for multinational logistics optimization. Responsible for managing relations with various subsidiaries – see Exhibit. 4. Would also serve as liaison with corporate functions such as information mgmt. and finance; finance particularly important to ensure inventory levels from multinational logistics organizations matched Xerox’s other financial systems. Also to take responsibility to ensure quality and HR issues were appropriately handled throughout Xerox’s worldwide logistics and asset mgmt. organizations How should Clendenin interpret this job offer? What implications would his decision have for his future relationship with Hewitt, career at Xerox as well as for MDC and its people?