Outsourcing the move
Issue 30 - May 07

When CIT Finance (Asia) decided to centralise its pan-Asian back office operations, a clear project strategy was essential. With the help of specialised project management professionals the Shanghai Operations Centre Project was born.

background
CIT Group Inc is a global commercial and consumer finance company with 7,200 employees in over 50 countries. Amongst other services, the group provides financial advice and solutions to businesses in areas
such as vendor financing, equipment and transportation financing, small business administration (SBA) loans, and commercial real estate financing. In 2006, CIT Finance embarked upon an expansion strategy for Asia-Pacific
operations Tom Hallman, Vice Chairman, Specialty Finance, explains how the aim of this was to “Accelerate our growth in China and Asia generally. CIT has been very successful in Asia and is a leading finance provider
in the region. We have been in China for 7 years and are expanding our presence there to provide support to our vendor relationships throughout Asia. We see exciting growth opportunities ahead.”

In line with this strategy of expansion, a decision was made to centralise seven back office functions previously distributed around Asia in Beijing, Seoul, Singapore, Hong Kong, Kuala Lumpur, Taipei and Shanghai. Hallman continues, “This strategy has been proven in other regions of the world and will uniquely position CIT to provide exceptional service to our customers.” While many locations were considered, Shanghai was
selected “To support our Asia strategy due to the pro-business environment and access to talented financial services staff.”

There were four key motivators for the project: to create a platform to support the aggressive growth plans for Asia, to achieve sufficient scale to enable process efficiencies and create development paths for employees, and most importantly, “To deliver world class service to our customers and vendors”, says Hallman.

project team
While outsourcing project management for relocation projects may not be standard practice in Asia, it is common in the European and American markets, especially for financial services companies. CIT decided that, taking into consideration the unique environment and challenges of the project, they would employ an external PM team.

Paul Bolwell, an independent project management specialist previously based in the UK, was taken on as the principal PM. The Project Management Office (PMO) was rounded out by the addition of Richard Lewis, a
business integration consultant and previous employee of CIT. Lewis describes how his experience complemented Bolwell’s, “Paul’s role had a more strategic slant, he acted as the key reporter to the corporate sponsors
while my job was more tactical, drawing on my legacy experience and knowledge of CIT core systems”.

Lewis & Bolwell’s first task was to “draw on previous experience to draw up the project structure”, says Bolwell. It was important to assign clear leadership roles right from the start, and there was “a clear decision to have a small steering committee of just four people, with the PMO feeding into it” he continues. In debates early on, it was suggested to include more corporate sponsors on the committee but “I was very keen to keep it to just
four people to help make decision making more efficient”. Once the steering committee had been formed, the team made sure to clarify who would be considered the end customer. This is very important when dealing with
multi-location, multi-department projects which involve changing an organisation’s structure, Bolwell explains, “for everybody concerned, from a project point of view, the MD of Asia was very much the main customer”.

project roll out
To facilitate the project, it was sub-divided into eight work streams to differentiate the different tasks and areas to be considered. A senior manager from CIT led each of the work streams, while the PMO was responsible for driving the project controlling resources and troubleshooting any problems. From the start, says Bolwell, “we focused on establishing the terms
of reference, the standards, procedures etc. were all agreed with the key stakeholders”. To do this, the project initiation phase took over one month, but was an essential component, “so that two, three months down the line when someone wanted to change something, a process was in place for that.”

Lewis highlights that communication was crucial to the project success, especially as the project involved working within many different cultural viewpoints, both within the Asian offices and the US HQ. We “worked
hard at it, from the corporate perspective we held weekly meetings with the country managers and we also had a monthly newsletter and intranet site set-up” he says. This meant that all stakeholders could access and update
project information on a live basis.

The Facilities stream, involving the office set up, was the first key milestone for the project and as such, it was vital that the site selection and fit-out were delay free and did not affect the other work streams. With the help of their real estate advisor, DTZ, a suitable building was located, UC Tower in the Pudong business district. In November 2006, CIT decided to lease the 18th floor of the
building. The location, says Bolwell, “was a perfect fit for CIT being a balance between the higher costs of a prime on-the-bund location and a great location delivering value for money”. Pudong and UC Tower offered a location in a highly developed business centre in Shanghai with good transport links, including proximity to the Maglev, the ultra-fast train which can complete the 30 km journey to Pudong International Airport in less than seven minutes.

The project consisted of eight work streams:
• Facilities – responsible for all the activities associated with the selection and fit out of the new office space.
• Process Mapping – understand the changes in business processes that need to be made as each country office transitioned to Shanghai.
• IT – activities associated with providing computer functionality to the desktops in the new office including all business applications, printers, scanners and faxes etc.
• Logistics – a “catch all” for the administrative activities associated with the
relocation of people, documents and equipment.
• HR – this work stream focused on putting in place all the HR requirements for the new Shanghai facility including running the recruitment, induction and training programmes.
• Operations, Finance & Credit – the last three work streams are concerned with those activities in each of the business functions required to complete relocation.
E.g. deployment and testing of assets and training of new staff in Shanghai.

collaborative creation
Selecting the designers and architects was, perhaps, an easier task than site selection. Mancini Duffy has a long-standing relationship with CIT in the United States, and CIT decided the relationship would continue to be implemented in Asia with a view to maintaining a global standard. While Mancini Duffy do not have offices in China, they do have a co-operative partnership with Asia based interior design firm Steven Leach Associates that allows them to offer their global clients service in China. David Pipkin,
Partner in Charge, SLA outlines the reasoning behind this, “Corporate cultures differ from location to location, combine these differences with the cultural differences of people across international borders, projects can run into serious problems on both the client and consultant side, usually a result of misunderstanding. Developing an international relationship between SLA and MD means we address these issues and build synergy”.



Working design teams on both sides of the world can sometimes cause difficulties, but Pipkin is happy to say that “the collaboration worked beautifully throughout the project.” He outlines how it worked: “The partnership meant that most days SLA was meeting with the local clients to sort out planning issues, material, issues, technical issues etc. These meeting typically lasted until seven or eight pm. The SLA Design team was able communicate the issues to MD and a revised plan, or answer to the problem was sitting in everyone’s box by eight am the next morning. Service was literally 24/7.”

Pavia Tso, Project Director/Manager, SLA, worked closely with the Mancini Duffy and CIT, she describes how SLA’s, “prime business focus is on corporate interiors for multi-nationals. The project was standard, the conditions were complex.” She says besides the complexity of the
managing the collaborative efforts, another important aspect was the issue of face: “many players are in positions without significant experience. It does require local knowledge and cultural understanding and careful management to allow everyone to keep their face and still solve the problems at hand”.

bridging cultures
When consolidating the design brief, finding the right common ground between cultural and organisational norms was essential, says Bolwell, for example “If you take cubicle size as an example, in the States the standard is something like 60 feet, in China it’s something like half that. This meant that corporate standards had to be balanced with common sense.” At the same time, it was important that “you could walk into the CIT office in Shanghai and still know it was a CIT office and that new employees felt they were joining multi-national organisation”.

project management
A strong groundwork was laid to facilitate open communication between all stakeholders involved in the project.

steering committee
• Weekly meeting 5pm Wednesday, with previous actions list and project dashboard report every week
• Special discussion topics and decision points

project management team
• Weekly meeting 11am Monday, with previous actions list and issues arising from and for the steering committee
• Individual work stream updates and special discussion topics
• Dependency monitoring and plan impact analysis

project management office
• Weekly one to one meetings with work stream leaders and key stakeholders
• Project management disciplines, plan check points, resource monitoring etc.
• Document management and communication, formal and informal

Understanding and balancing the various project factors in a culturally sensitive manner has been instrumental in achieving the major goals for CIT. “The first major milestone was getting the facility up and running before Chinese New Year, and we hit that one dead on”, explains Bolwell. Following that, the next key targets were recruitment of new staff and the first cut-over of operations to the Shanghai office from the former HQ in Hong Kong. With those stages completed satisfactorily, the systems will be in place to
continue the move with a final completion date scheduled for mid-2007. RFP

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