Repair Work

For now, however, the wide culture gap between Stuttgart and Auburn Hills remains Unger's bête noire. Even before the merger was officially announced, Unger, aware that bickering would impede fast progress, began creating IT teams to size up the combined companies' IT strengths, weaknesses and priorities (see "CIO Roadmap"). But most significant, Unger says, was her decision to immediately confront most cultural issues head-on.

Under Unger's leadership, DC used a "Balanced Scorecard" to measure progress by the IT group toward a specific goal— in this case, cross-cultural cooperation. Unger's group was ranked with color- coded "grades." In DC's case, green meant progress, yellow meant problems and red meant failure. "At first," Unger recalls, "we were always being rated red, never green. I was always in trouble. But I knew that if everyone was comfortable right away culturally, we couldn't be doing the right thing." Creating a new culture out of two old ones was not going to be comfortable for anyone, she says, "so we hit the hard issues first and I did what I could to bring out the pain right at the beginning."

Unger moved quickly, for example, to establish who would be in charge, who would report to whom, how decisions would be made and what sorts of behaviors would be discouraged—and punished—come performance review time. Unger also sought to manage expectations, as in her belief that "red" was not something to worry too much about in the merged company's first weeks.

Six months into the merger? Unger's group started scoring green. "I think what helped is that we focused not on territory, but on ROI as a unifying theme," she says. Unger also sought input from the business side at every turn, and set time limits on deliberations. "Most frustrating has been the difference in the way people work," Unger says. "The Germans, at first, wanted to take weeks to make decisions that the Americans wanted to make in hours."

The new rules of the road according to Unger: First, American managers need to brief German counterparts on proposals in advance of a vote; German managers must be prepared to make faster decisions. Second, no IT project gets a green light unless it leads to a payoff for the bottom line—and meets the needs of the people who want the technology. Third, senior management must support all IT projects and put their key people on those projects, or the project gets left in the dust. Says John Parkinson, chief technologist for Cap Gemini Ernst & Young LLC: "CIOs in merger situations are almost always the diplomats on the front line, because through IT you really are brokering a deal between the most significant parts of the enterprise—not spreadsheets and assets but communications systems. Success lies more with managing the roles and expectations than the technology."

Even so, deciding which technologies get centralized and which stay local remains tough, and Unger acknowledges the difficulty. "I try to stress that I am neutral with technology and suppliers. I couldn't care less. But a lot of these decisions tend to be emotional nonetheless," she says. "You mitigate emotions by trying to keep everyone focused on ROI, of course, but the technology biases you have to deal with sometimes are immense. They're holy wars."