Sunday, 22 January 2012

CSC – the beginning of a management exodus, but are the right people leaving?

In our January 16 posting (“Senior managers exiting CSC”) we wrote about executive departures. So far, we have learned that:

Gary Mellor (President, COO Managed Services Sector (MSS) was told to leave CSC about 10 days ago. He was followed shortly after by Andy Williams, President, Managed Services Sector (MSS) EMEA, who was in charge of CSC’s UK and Nordic businesses.  Williams joined CSC just a couple of years ago, replacing Nick Wilson who only stayed for about two years before leaving for Hewlett Packard.

Williams left days after CSC got a first view of its results for the quarter to December 2011.  Could his sudden departure mean CSC is about to announce yet another disappointing quarter? Or has he failed to clean up the problems he inherited in Nordic? Or maybe he just hasn’t cleaned them up fast enough for the liking of CSC Corporate management.   Andy Williams’ short stay at CSC begs the question of whether he was the right person for the job. But it also raises the question of what support he got from EMEA and Corporate management. We heard that he was frustrated by the assignment of unrealistic financial targets, and constant micro-management from above.   Sounds familiar doesn’t it?  CSC may now be regretting the actions which caused Keith Wilman, the successful former President of CSC UK, to quit CSC to pursue his career elsewhere in 2007!

Another senior executive on her way out of CSC is Kathleen Ramey, the Worldwide VP Finance for Managed Services Sector (MSS).  Her departure has shocked many CSC employees because of her track record of success and the respect she enjoyed throughout the company.    She was a 20+ year veteran who spent a number of years in Europe, including serving as VP Finance for CSC UK.  We understand that Ms Ramey is another victim of problems in the Managed Services Sector.  

CSC seems to have started dealing with senior executives whose performance is considered below expectations, we wonder if they are correctly identifying the executives responsible for the company’s failures? 

Guy Hains - President EMEA, seems to escape all accountability for the Nordic irregularities and for the NHS project failure.  Not only did they both happen on his watch as CSC’s President of Europe, but he also had more direct management involvement in them. We understand he was on CSC’s Board of Directors in Nordic at the time of the irregularities; he was the also the lead CSC executive on NHS NPfIT project team which included selecting the failed software supplier iSoft.    The project that led to the single biggest write off that CSC has ever taken. How much bigger has a problem got to become and how much more involved has an executive got to be before he takes responsibility for the results?

 Similarly no senior executive has been held accountable for the steady decline of the European Finance function (remember this is the function that has lost the leaders in every single country, even prior to these recent issues). European Finance deteriorated to the point where irregularities such as those in Nordic could occur in the first place, and then could go undetected for so long.  This decline did not occur overnight. It has to be the result of years of executive mismanagement and an inability to retain many of the best Finance managers and leaders. Yet no action has been taken at either EMEA or Corporate Finance levels.  Why not?

And are there more departures still to come?


Ex-CSCer in the UK said...

Kathleen Ramey out while Bryan Brady is still there. What does that say about the value system within CSC today?

Anonymous said...

You say Guy Hains should take responsibility for the failure of the NHS project. I suppose that means he should resign or be fired.

But maybe he has not failed from the perspective of what is most important to CSC.

The project itself has failed. The NHS got little benefit from it, the UK Government considers it a waste of UK £10billion of taxpayers' money and CSC's reputation has been shredded.

But perhaps it has been a financial success, which in CSC will override all other considerations such as project failure, dissatisfied customers and damage to CSC's image.

CSC has not said how much revenue it got from NHS, but the UK Government's said its cost was UK £10billion, equivalent to maybe $17billion over the life of the project.

How much of this $17billion went to CSC? Maybe $10billion as CSC was the major supplier. A direct project margin of 35% would yield $3.5billion contribution to CSC profit. Even after the recently announced $1.5billion write-off, this still leaves $2billion margin for CSC.

This is a good financial return for a project which many rightly believed would never work and which has never worked. What would CSC's results have been over the past 5 or 6 years without the revenue and profit from NHS? Why should Guy Hains be viewed as having failed if the project made so much profit? The rest of of secondary importance.

Anonymous said...

I agree with the last comment re: accountability and responsibility! It seems like its everywhere in CSC (not saying its any different in other org....)

Anonymous said...

I personally worked for Ramey for several years. Believe me, she needed to go. A good move on the part of CSC if you ask me.