MANAGEMENT : Doing it the Logica Way

Roger Trapp reports on a successful British computer company that knows how to make the most of its greatest asset - its staff

By any lights, the computer company Logica is a success story. Just by still being around as an independent 25 years after it was founded makes it so. After all, many of the British rivals set up at about the same time have been sucked into much larger, often foreign, organisations. But that is not to say that recent years have not seen some of the lustre worn off.

Jim McKenna, the group personnel director, who arrived 18 months ago from GEC-Marconi with the new managing director and chief executive, Martin Read, points out that the company quoted since 1983 had seen growth slow and profitability slip.

It will come as little surprise to GEC watchers that Dr Read has used the disciplines acquired at his old company to tackle the latter. Results for the six months to 31 December 1994 show earnings per share up 42 per cent and profits ahead nearly as much, at £7.2m on a turnover rising 15 per cent to £122m. But few would expect that he and his senior colleagues see an important lever for the former in the sort of "touchy-feely" initiative that would be unlikely to see the light of day in Lord Weinstock's organisation.

There is nothing particularly original about the name of this programme, the Logica Way. ICL, the British computer company now owned by Fujitsu of Japan, has a "way" of its own, meaning a code of principles designed to demonstrate the "way we do things around here". In addition, Hewlett- Packard of the US is notorious for inculcating the thinking of its founders among its worldwide staff. But Mr McKenna is convinced the project can help the company achieve a significantadvantage over its rivals in the intensely competitive markets in which it operates.

"You look at the cost structures, but you also look at how to expand the company and at the behaviours that affect it. You've got to look at all three at the same time to push it forward," he explains, adding that it is no good thinking each can be dealt with in separate phases.

Bearing in mind that in a service industry the only real assets "go home at night", the new management team decided that the company's ability to move these human resources around the world to where they were needed was of critical importance.

Clients such as Ford or Reuters were not unduly concerned about where the expertise was coming from; they just wanted it to be of the same standard, whether the work was being done in Britain or the Far East. Similarly, a bank that wanted to install a trading floor (one of Logica's specialities) in London would probably like to use the same team when it repeated the exercise in New York or Frankfurt.

But to enable the company to meet such demands required changing a culture that had led to the setting up of what one insider calls "lots of mini- Logica UKs" around the world. Instead, it is seeking to create an atmosphere in which all 3,600 personnel spread among 17 countries feel that they work for a single organisation.

"We're trying to integrate the company far more effectively than we've done in the past," says Mr McKenna. "The customer should just see Logica rather than, say, Logica UK or Logica Switzerland."

But he admits that it is quite difficult telling managers in overseas offices that they do not just have the people in that territory at their disposal but can also call upon all 3,600 around the world. He also acknowledges that there will inevitably be conflicts when certain specialist teams will be required to be in two places at once.

But he suggests that the company's reward system for managers - under which a part of the bonus is governed by their ability to be good "corporate citizens" helps to demonstrate the importance the senior executives are attaching to the concept.

Help is also on the way on the practical side with the building of a "resource management system" - basically, a database listing all the skills and abilities acquired by the organisation's staff. It is designed to tell managers who is doing what where and when they will become available for another task.

Mr McKenna and his team are also seeking to emphasise the increasingly global nature of the business through changes to the remuneration system. Since the Logica Way was rolled out three to four months ago, all staff transferred to foreign operations are made subject to the same terms and conditions as those they are working alongside. This not only makes commercial sense for the company, it also reduces the chances of resentments building up among staff in the host countries, he says.

Though it can lead to effective cuts in pay - particularly when Americans come to Britain - Mr McKenna prefers not to see it that way. The important thing is earning power, he adds.

Though he is anxious to do away with the idea that foreign postings are a way of acquiring nest eggs - as has been the case with many companies in the past - Mr McKenna still sees a strong demand for overseas postings. With a workforce where - thanks to a recruitment policy that has brought upwards of 150 new graduates into the company every year, even through the recession - the average age is about 28, Logica sees providing foreign travel as an important factor in persuading ambitious and talented staff to stay. If they know where this fits into their career development, so much the better.

Not that conventional training in management skills and the technical ability which is the company's lifeblood has been neglected. Both areas have seen budgets raised, and there is close monitoring, Mr McKenna says, to ensure that the money is being spent. But though the courses are typically international in make-up, to reinforce the global aspirations, not all the training is formal. Extensive use is also being made of coaching and giving guidance to managers faced with dealing with the increasingly harsh business environment.

Mr McKenna insists that, while the Logica Way includes a vision and something that looks like a mission statement, it is no passing fad. "It will be an ongoing process. We hope it will be ingrained as a way of life," he says.

He also stresses that there is a strong commercial element to it. Pointing out that success depended on the ability to satisfy simultaneously the demands of shareholders, staff, customers and industry partners, he says the ultimate judgement on the worth of the programme will come in sustained growth.

"We've got to achieve predictability that shareholders know they'll get a return this year, next year and the year after."

Many companies' senior executives are spending a lot of time debating how best to achieve that, he adds. But Logica is unusual in spreading the discussion to the mass of the workforce because it acknowledges that everybody has an important contact with the customer.

"The real benefit will come from a snowball rolling down the hill with everybody on board."

Arts and Entertainment
Joel Edgerton, John Turturro and Christian Bale in Exodus: Gods and Kings
Arts and Entertainment
Brendan O'Carroll as Agnes Brown in the 2014 Mrs Brown's Boys Christmas special
tvCould Mrs Brown's Boys have taken lead for second year?
Members and supporters of the lesbian, gay, bisexual, transgender (LGBT) community walk with a rainbow flag during a rally in July
footballLive! Chelsea vs West Ham kicked off 10 Boxing Day matches, with Arsenal vs QPR closing the action
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
Amy Adams and Christoph Waltz in Tim Burton's Big Eyes
film reviewThis is Tim Burton’s most intimate and subtle film for a decade
Arts and Entertainment
Jack O'Connell stars as Louis Zamperini in Angelina Jolie's Unbroken
film review... even if Jack O'Connell is excellent
Arts and Entertainment
Madonna is not in Twitter's good books after describing her album leak as 'artistic rape and terrorism'
music14 more 'Rebel Heart' tracks leaked including Pharrell Williams collaboration
Latest stories from i100
iJobs Job Widget
iJobs Student

Ashdown Group: 1st Line IT Support - Surrey - £24,000

£20000 - £24000 per annum + training: Ashdown Group: Graduate IT Support Helpd...

Recruitment Genius: Graduate Audit Assistant

£19000 - £21000 per annum: Recruitment Genius: Audit Graduate Opportunities ar...

Guru Careers: Graduate Marketing Analyst / Online Marketing Exec (SEO / PPC)

£18 - 24k (DOE): Guru Careers: A Graduate Marketing Analyst / Online Marketing...

FDM Group: Business and Technical IT Consultants – London, Manchester, Glasgow

21,000-24,000: FDM Group: Kick-start your career and join FDM’s award-winning ...

Day In a Page

A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all