Telework eases turmoil of acquisition

Mapics’ acquisition of Frontstep created an opportunity for employees to work out of virtual offices.

Mapics’ investment in telework paid off big this year when the company acquired another software developer, Frontstep. Both developed ERP applications for the manufacturing industry and had offices scattered worldwide. But in the early 1990s, Mapics – a spinoff from IBM – began experimenting with telework and since has used it extensively to reduce facilities costs in the down economy. In March 2002, Mapics shut down its lab in Woburn, Mass., converting it to a virtual office.

“Rather than lay people off, we sent them home. That unleashed remarkable changes across our business,” says Sandy Hofmann, Mapics CIO and chief people officer.

Buying Frontstep in February brought Mapics a new set of challenges. Overnight, the firm went from 450 to 1,100 employees, with 35 locations. The goal was to take the best practices of each firm, eliminate redundancies and pare down the new company to 720 employees with 17 sites. Again, the company turned to telework, relying on technologies and strategies it had honed in the past.

On Day One, Mapics had to appear as one company, even though Mapics and Frontstep had different network operating systems, e-mail systems and applications. Jim Overdorff, Mapics technical services director, used mail-forwarding techniques to send both companies’ e-mail to Mapics’ Lotus Domino servers and routed the companies’ Web traffic to one site. Mapics’ extensive use of VPN for remote access made it relatively easy for Overdorff to set up a point-to-point VPN between the two networks that let the businesses transfer data behind each company’s firewall. “We still had to gain permissions to each other’s networks, but it opened a gateway,” he says.

Since February, the Mapics integration team has analyzed each company’s systems, processes and applications – as well as facilities and business units – and selecting the best to use in the new Mapics.

Company portal eased transition

One key to making the acquisition a success was Mapics’ portal, which provides corporate information, policies, organizational charts and training information.

“We used the portal to help keep everybody connected and to establish a cultural norm. Two different cultures coming together will have differences – geographic differences, the South vs. the Midwest,” Hofmann says. “And since many of us came from IBM, we still bled blue. We have a lot of formal management policies in place, where Frontstep didn’t. We wanted to make sure the new employees got a sense of what Mapics was like.”

In consolidating offices, Mapics rolled out its existing telework policies and guidelines to each office. The integration team would meet with each department via Web conference and ask, “What is your choice, to continue using this facility, to consolidate people, or to virtualize? What do you need to run the business? Our goal is to get down to 17 offices, and reduce office space by 25%. Tell us why we can’t get there,” Overdorff says.

He says closing the Woburn facility last year was an invaluable experience. “I met with 10 tech people who were all looking at me with daggers. Each had his arms crossed, leaning back in the chair, glaring at me,” he says.

To ease the tension, Overdorff had the group brainstorm every reason they thought the virtual office wouldn’t work. “One would say, ‘I compile objects together and my home system doesn’t have enough processing power.’ I’d say, no problem, we’ll get you a more powerful system. Another would say, ‘Customer support needs three-way calling and call forwarding; you can’t do that from home.’ I’d say, we can order that service from the phone company. We just addressed each one, going down the line,” he says.

Even so, Overdorff and Hofmann met resistance from Frontstep. “At first there was some trepidation, to use a mild word,” Hofmann says. “It’s frightening for people. A lot of these jobs have a very social nature. So we got some Mapics people who’d been successful moving to a virtual office to talk to them, to say, ‘Hey, this is a piece of cake, life is good.'”

Bill Lilegdon, Frontstep’s director of strategic extensions, had been driving to work in Indianapolis for 24 years. He traveled often and didn’t use remote collaboration tools. When he started working from home in a basement office, he realized he still needed to go somewhere in the morning, create that separation from home and work, so he drives his daughters to school. Because his wife is home during the day with their baby, he finds the hardest thing is to get his family to understand when he’s home working and when he’s home not working.

He says he suffered from a little denial at first. “I didn’t get a home phone line for a while; I just used my cell phone. But it’s really great now. We have a lot of family in the area, and it would be a big deal if we had to relocate. It’s much better to work where you want to live,” he says.

“It’s hard to scoff at the results you get from people,” Hofmann says. “We spend more time trying to make sure people stop working. If they work too long hours, they make mistakes and don’t realize it. Quality suffers. We have to teach them that.”

Overdorff agrees. “I tell people, at the end of the day, unplug the phone, wrap a cord around it and push it aside. You have to shut yourself off, realize the day is over. We don’t want to burn people out,” he says.