A year after McDonnell Douglas and IBM entered into the largest IT outsourcing agreement at the time, both companies realized that cultural differences were inhibiting their ability to make effective decisions together and were preventing each company from realizing the benefits originally anticipated from the alliance. As a government contractor, MDC was accustomed to total cost-transparency and detailed oversight by contracting agencies. IBM, with a private sector approach, was reluctant to disclose proprietary cost information and found the oversight team inappropriately intrusive and untrusting. Friction and mistrust led to lengthy and acrimonious approval processes and escalations, even over what both companies deemed minor matters.
Ms. Gray was asked to bridge the cultural gap and to assist MDC and IBM in understanding each other’s actions in the context of their prior “standard” business operations. She enabled them to develop a governance framework that was effective and operational, that satisfied both sides, and that minimized opportunities for friction and distrust. By implementing the framework, McDonnell Douglas and IBM were able to develop and agree on standard operating modes that dramatically reduced coordination and oversight costs over the life of the contract.