Oil Change: Perspectives on Corporate Transformation

By Art Kleiner; George Roth et al. | Go to book overview

CHAPTER 6

NOBLE PURPOSE:
THE OILCO CONSULTING
GOVERNANCE STORY

Changes in governance put groups in new relationships with one another. Traditional ways of doing business and servicing customers rapidly disappeared, as internal units had more freedom to build relationships with outside entities.

This story, based at OilCo Consulting, shows how internal service provider units faced an immediate challenge: dealing with the breakdown of old relationships and the challenge of being "merely" a supplier.


LEARNING THE NEW ROLE

The story begins in January 1995. A change in governance structure was announced. OilCo Consulting would become a separate entity, responsible for its own bottom line, with only a two-year "grace period" in which current contracts inside OilCo would be guaranteed. After that, OilCo Consulting would be completely dependent on its ability to keep customers -- customers inside OilCo and elsewhere.

MANAGER, OilCo CONSULTING: It wasn't just a matter of business performance. It was our life line. Either we turned ourselves from a cost mentality into a profitable business, or we'd probably go away.

I still hear people from the rest of OilCo saying, "Oh, poor you, that must be awful to work there. You all will never make it, will you?"

-83-

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