Centralized System at ABB

ABB (ASEA Brown Boveri) is a power and automation company operating globally in a dynamic environment with 124,000 employees in over 100 nations. The company has experienced an extended period of success due to its ability to run in the diverse currency environment. The company’s initiative to expand and operate in more counties presents an opportunity for increasing profits. However, operations in global scale face complex, unprecedented challenges of more accounting and compliance regulations in the different countries. ABB has to navigate the hurdles through managerial changes to cope with the dynamics. One way of dealing with the various jurisdictions is having a centralized system conducting business activities an aspect the company lacks. Traditionally, most ABB branches work autonomously in the different countries with defined system favorable to their regions such as bank proprietary systems, numerous local credit agreements. The independent mode of operation of the constituent branches is inefficient thus necessitating the need for an organizational change to optimize the terms and conditions of transactions, re-align credit lines and put the unutilized into productive use. The circumstances at ABB demands a single application to harmonize all the trade finance operations to address bank guarantees.

Organizational change refers to the process of altering the structure, techniques, methodologies and the entire or partial corporate culture. The changes aim to make the company more productive. Sometimes an imminent or existing failure triggers the need for changes to keep the organization running. The problem at ABB is the lack of central visibility in conducting business trade finance processes. Nevertheless, changes in various organizations occur continuously or over a specific period. Therefore, ABB has to focus on three areas to realize the centralized system agenda. The sections are changes in the management support, an effective communication plan and a training strategy for the various global operations. The Lewin’s theory of organizational change empathizes on the need for changing an organization’s status quo to realize any intended goals of the process (Batras, et al. 2016). Therefore, the primary objective for ABB is to destabilize the tradition of independence of the of the branches by establishing a centralized system.

The initiative re-stabilizes the environment eliminating the local credit contracts and allows for favorable terms. The variant contracts make it difficult to handle the guarantees since it is challenging to optimize the conditions and realign credit lines. The company, a project firm constituted an existing internal team comprising of team leader and the organizational improvement. Project management requires proper communication to create awareness and draw support from all stakeholders. ABB is a multinational company there was formal communication to minimize likely rumors and gossip, particularly among the regional managers. Lack of proper communication resulting in uncertainties and anxiety among employees would crumble to understand the intended initiatives(Christensen, 2015). The communication flow occurs from the top leadership down to the representatives from the regional companies. Official communication reduces psychological insecurity concerning the impact of the centralization of the activities. As a result, the overall management gains the support of the various regional managers by increasing the acceptance, transparency, and commitment to the plan. The project manager has a significant influence giving directions to the other supervisor involving them in planning and execution of the activities to realize success.

Branding of the financial services is an essential exercise that raises and keeps the ABB company service profile as well regularly communicate the ideas to maintain the interest high among the constituent companies. The optimization the bank guarantees for the customers as one of the primary objective require the messaging via Bolero while configuring the internal interfaces to the central database. Therefore, branding the project, Surecomp’s COR-TF system gave the initiative the requisite uniqueness. The term Surecomp’s COR-TF creates the familiarity and recognition of the project among the employees as well as justifying the investment cost of a centralized system for the global company to avoid complaints from the shareholders. Furthermore, the branding of the change initiative creates an emotional connection with the different stakeholders of the company thus bolstering their loyalty; consequently, driving the success the project to a victory(Arruda, 2018). According to Everett’s theory of organizational change, messages about new ideas expressed within the organization brings about confusion. Also, messaging in any project management process must conform to the company’s structural factors. Therefore, ABB being a global firm must convey the different ideas from the head office to the various regional branches explaining why the company needed to centralize the activities based on the challenges of the present lack of visibility in trade finance process. The situation limits the optimization and allocation of credit lines. It is undoubtedly true that branding with a competent team creates the required uniqueness of the project by establishing the connectivity between the banks and the central administration.

The ABB, a project company with a large workforce, requires then couching of its internal project team. The change management support team included project team development, coaching, mentoring as well as stakeholder management to see the process through. The Chris Argyris and Donald Schon theory of organizational change asserts that the success of any firm’s project depends significantly on the learning and how well the employees and other stakeholders are ready to participate in the change process. The coaching exercise among the employees positively alters their beliefs, values and behaviors and motives. The Schon’s theory states that mentoring the workforce about a change project influence how they perceive, think and feel about the process(Batras, et al., 2016). The managers at ABB, using their mentored the selected group to demonstrate the need to centralize the operations earning their allegiance towards the project. The scope of the centralization issue is critical thus necessitating a good team selection comprising right individuals based on skills. The expected IT infrastructure require efficiency requiring the IT experts to get their best design especially through the harmonization of the different software and the installation of the firewall mechanism to keep the data secure.

There is an existing culture of separate operations and reporting; therefore, an initial meeting gives a chance to the project team familiarize themselves with the project visualizing their roles. Finance experts went in the different nations holding meetings with the various managers on how to harmonize the fragmented local credit deals. The team members went through the storming process to find common ground for the best steps to actualize the implementation agenda. Ordinarily, team leaders guide the process to minimize the conflict that often arises among members as they share their thoughts on the best course of action(Project Management , 2016). The integrated system requires high-level security of high-level firewalls to prevent data breach; the task requires extensive consultations and collaboration. As a result, the team leader has to facilitate the cooperation process by ensuring the members understand the opinion differences and become accommodative. Moreover, the dynamics call for levels of self-independence forcing the leader to leverage decision making to build the independence for more efficiency. The finalization on the best resolutions gives way for the commencement of implementation phase.

The interdependence among the selected team is crucial for the project’s success. The group made decisions and solved the challenges quickly and effectively as they arise, and where a disagreement arose, they worked through by reaching consensus without interrupting the project’s progress; the project manager carries the oversight role to monitor the progress. The company needs to optimize the structured message for the bank guarantees with sophisticated bank limit administration supported with external connectivity under a central database. Therefore, the implementation face required coaching and mentoring to make it a success; coaching and mentoring are vital project management tools that significantly determine the achievement of the intended results. The project at ABB is an internal one presents problems of multitasking among the member staff. Therefore, the project manager conducts coaching exercise to help the members on focusing on the performance and productivity of the workforce on their current roles and positions since more often than note, there is a big challenge where the employees have to multitask without compromising their delivery on their other responsibilities.

The change is continuous thus requiring direction and supervision continuously in the various on the aspects of the tasks. The leader developed trust between the staff and the coaching team. Coaching involves the description of the purpose, excellent communication, well-formulated action plan and the overall support for the members(Windsor, 2017). The overall goal of central coordination of processes is a long-term activity. As a result, the project team must balance their activities by drafting a flexible work schedule despite the high workload. In essence, the managers and assistants helped the project team members to grow and reach their full potential through well-structured, short-term, purposeful and measurable parameters as well as mentorship to see the project through focusing on long-term outcomes of initiatives. The rooted varying organizational culture has a significant effect on the perception among the workers and stakeholders calling for the assistance in changing the members’ character, self-awareness, and values. The mentorship is more spontaneous compared to coaching since the process arises from personal relationships and proceed as needed for the varying situations. The mentors listened and showcased patience to the mentees to enable them to understand and make individual efforts in executing the assigned tasks of the project. The centralization is a vast and vital project for the firm; the company had to invest tremendous financial and time investment assist the internal team to deliver their respective mandates. For instance, the rollout and the implementation of the projects in 80 of the target countries took about five years to allow for the testing of the project aspects of testing the texting system.

The use of the proposed system of managing the business processes in more than 100 countries requires an excellent team to configure and operate the new I.T system. The requirement of a sound system calls for adequate training strategy to see the centralized system work. Training during a process of change in any organization impacts the workers’ perspectives on values, focus on the primary goal and learn new behaviors. The teaching exercise allows one to gain high mental capacity. Similarly, the concerned individuals update their knowledge and skills through the creation of awareness of their learning potentials(Ikinci, 2014). The ABB selected project team through the mentors performed the training exercise on the staff regarding cost-effective and sustainable global service delivery to the customers in the various nations. The organization used its existing resources and processes to facilitate the change process. The Andrew theory of organizational change asserts that the success of an initiative depends on numerous factors including the quality and coherence of policy. A change process depends on the presence of supportive leaders who create the required conducive environment. Therefore, in ABB, the project team needs to establish the best environment for meeting the various items on the implementation checklist. The project managers at the ABB company have to use clinical, managerial relation with good inter-organizational networks with the inherent simplicity and clarity levels in conformity to the goals and priorities. By training the employees in the various nations, there is an accelerated process of adapting to the new modification of reporting and decision making for the broader benefit of the organization. The project managers at ABB firm adopted a transformational leadership style where they allowed the transfer of thoughts, knowledge and learned ideas between the change-involved personnel thus instilling the culture of learning.

The overall project in-charge has to emphasize to the unit managers and the representatives on the importance of effective utilization of the available resources to by setting out clear aims to trigger and see through a successful implementation. ABB’s project presents a massive task due to the sensitivity of trade finance processes. The circumstances require regular communication, review of the progress. The functional improvement consultants give the implementation process the adequate resources needed for the global training forum. The project requires three essential resources for success, people, capital, and material goods. The people carry the day to day activities of the project. The selection of an internal team met the necessary skills and expertise in I.T to help them assemble the system that would allow centralized coordination (John, et al. 2017). Therefore, the resources for personnel mobilization and training exercises in the host countries become vital for success. The other success factor was the adoption of Goal Oriented Project Management (GOPM) to clarify the successful outcomes; goal orientation allows the internal project team to visualize the future state of an organization after given proposed changes. As a result, the managers set the rules and the scorecard to keep the participants focused and minimize deviations and time wastage. The idea is to ensure there are tangible project goals (Pucher 2011).

Based on the principle of project goal orientation, the managers focus on the elements of implementation like optimization of the bank guarantee message types, external bank connectivity via Bolero, configuration of the interfaces to the central information system. The goal-oriented project allowed for flexibility and adjustment to attain the best outcomes for the ABB company to facilitate profitability out of the project. The change is continuous activity in a large firm hence project review becomes imperative. Project evaluation refers to practices of reflecting on the undertaken activities at every stage of implementation. The team analysis and identifies the positive and negative lessons to minimize future mistakes and capitalize on the positive aspects of the project (Litsikakis 2017). ABB project team conducted active customer and profitability assessment to ensure the primary goal of the centralized system worked for the company to be successful and delivery the annual savings. For example, by identifying and clearing the many costly legacy guarantees, reducing costs and negotiate more favorable business terms to generate high profits for the company.

References

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