Case Study Bell Labs:
PN&Ainc It Was More Than Just a Job (…the Unintended Consequences of Change)
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“ It Wase h t … More nded e t n i n U Than uences q e s n o C Just aange h C f o Job ”
2014
Case Study Bell Labs:
PN&Ainc It Was More Than Just a Job (‌the Unintended Consequences of Change)
BELL LABS:
Case Study Bell Labs:
“ It Wase h t … More nded e t n i n U Than uences q e s n o C Just aange h C f o Job ”
PN&Ainc It Was More Than Just a Job (…the Unintended Consequences of Change)
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hulam Muhammad, Herbert Good and John “Chip”Fitzgerald just looked at one another. Together they had almost 90 years of service at AT&T Bell Labs and they couldn’t believe what they’d just been told-or who was doing the telling. Another management model, another paradigm shift, another obstacle to unfettered research, another step closer
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ourtney left the meeting frustrated, and a little angry
to just punching a clock at a job. Somewhere, probably at 550 Madison Avenue, someone, probably an executive with no background in science or research, decided that yet another layer of business rationale and market justification must be completed before approving research funding just a job. And the person informing them of this latest slap in the
face is Courtney, a woman in her mid-30s, a woman younger than several of their children-in their minds a mere slip of a girl. And of course, she had no satisfactory answers to the key questions they’d have to field from their teams. “What about our current research?” “What about the work we’ve already begun and published? Who decides if it passes muster?”
“What about future research projects? Does funding require a switch from pure scientific research to market research?” They shared the view that this was more than just a job and without some answers, Ghulam, Herbert and Chip don’t know how Courtney expected them to sell this information to their teams.
Her three top managers are great guys and she respects their accomplishments, but this open resistance to the new management model is
making her job harder. She gets their position, she really does - but the decision and even the discussion about the decision
happened far above her pay grade. Her primary responsibility is to make sure her division is in compliance. Period.
Case Study Bell Labs:
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nd it’s not as though Ghulam, Herbert and Chip don’t know that they’ve been at the Labs since before she was in graduate school. But maybe that’s the problem. While Courtney and everyone else in the physics program at CalTech knew the illustrious history of Bell Labs and had opinions aboutthe potential impacts if AT&T was actually forced to divest, those opinions were purely academic. And while Courtney was already part of the AT&T family and far from pleased when the Justice Department’s ruling came down, her feelings were mostly professional. But for guys like Ghulam, Herbert and Chip, divestiture was a devastating loss personally and professionally. Working at Bell Labs was a way of being and defining oneself in the world; it was more than just a job. The break-up of AT&T was the single biggest event in the history of business. There was much discussion and strategic planning around the structure of the new Regional Holding Companies, the so-called “Baby Bells”, and how the assets of the former parent would be distributed. There was speculation about how AT&T’s widely touted “cradle-to-the-grave” employment policy would be affected by divestiture.
But in retrospect it seemed precious little thought had been expended in examining how divestiture might completely reshape the worlds of Bell Labs and Western Electric and the people who worked there, the folks for whom it was more than just a job.
The break-up of AT&T was the single biggest event in the history of business. Angie Miller and Courtney were best friends and roommates at CalTech and both signed on with AT&T on the same day. Courtney moved back to New Jersey to work for Bell Labs at Murray Hill while Angie went home to Illinois to work for Western Electric’s 11,000 employee behemoth plant at Naperville-Lisle, in the Chicago area. Angie left the company after divestiture, but she and Courtney stayed in touch and Angie often teased Courtney that Western Electric was really the unacknowledged jewel in the AT&T crown.
Courtney took it in stride because she knew Angie was at least partially right. Even as her Bell Labs team bemoaned the lack of respect from some corners of corporate, they were quite comfortable in their dismissal of Western Electric and the critical work done there. She was certain her team would be insulted if she even implied the organizations were peers. She doubted they knew Bell Labs was the 1925 consolidation of Western Electric Research Laboratories and part of the engineering department of AT&T. Or that initially AT&T and Western Electric were coowners of Bell Labs, whose primary business was to design Western Electric’s equipment for AT&T. But that history didn’t fit their narrative. Courtney knows this is more than just a job and she gets the pull of seeing oneself as a leading physicist, a potential Nobel Prize winner waiting in the wings. But that kind of dream is fueled by the kind of unfettered research dollars Bell Labs is no longer willing to supply.
1974 -82: ANTITRUST & MANDATE
This divestiture was initiated by the filing in 1974 by the United States Department of Justice of an antitrust lawsuit against AT&T.[2] The breakup of the Bell System was mandated on January 8, 1982
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AT&T DIVESTITURE: BABY BELLS
REDUCTION
The breakup of the Bell System resulted in creation of seven independent companies, “Baby Bells”, that were formed from the original twenty-two AT&Tcontrolled members of the System.[5]
This divestiture reduced the book value of AT&T by approximately 70%
-70%
(SOURCE) Breakup of the Bell System. (2015, January 15). In Wikipedia, The Free Encyclopedia. Retrieved 20:21, February 5, 2015, fromhttp://en. wikipedia. org/w/index.php? title=Breakup_of_th e_Bell_System&oldi d=642608996
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PN&Ainc It Was More Than Just a Job (…the Unintended Consequences of Change)
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ourtney poured a cup of now lukewarm tea from her thermos and decided against going into the break room to reheat it. She just couldn’t talk to anybody else before facing the file folder on her desk. How is she going to explain the dismal results of yet another climate survey? Courtney knew morale was low and that it was adversely affecting productivity. But every bad climate survey report meant another unpleasant meeting where she’d be expected to explain the results and her plans to fix them to her manager’s manager and the rest of the senior staff. The problem is Courtney knows the declines are adversely affecting productivity. What she doesn’t know is how to fix the situation.
...for guys like Ghulam, Herbert and Chip, divestiture was a devastating loss personally and professionally. Working at Bell Labs was a way of being and defining oneself in the world; it was more than just a job.
History & Back Story Ghulam, Herbert and Chip are friends connected by a shared love of scientific research, family histories of socially-forced migration and the corresponding expectation of excellence by their parents. After the Punjab province of British India was partitioned in 1947 Ghulam’s parents, as part of the Hindu minority, began their journey to the United States to escape religious persecution. 97.21% Islam 2.31% Christian .48% Other*
* Includes Ahmedi, Hindus, Sikhs, Parsis and Bahá'í.[33]
They prospered in California but it wasn’t easy and Ghulam completed his undergraduate, graduate and post-doctoral studies at UC Berkeley keenly aware of being different and trying to assimilate through academic excellence. By age 30 he was a successful researcher in mathematics at Bell Labs, Murray Hill with a list of articles and publications to his credit.
South-Asian Diaspora
The language spread of Panjabi in the United States according to U. S. Census 2000 and other resources interpreted by research of U. S. ENGLISH Foundation, percentage of home speakers
Herbert’s parents also had a story of migration having left the violent citrus groves in their hometown of Sanford, Florida-literally under cover of darkness. After completing medical school at Meharry Medical College in Nashville, TN and then serving in France during WWII, Herbert’s Dad couldn’t reconcile himself to the harsh constraints of the segregated South where the safety of his wife and children would always be at risk. He packed up and moved his young family to Chicago as part of “The Great Migration.” Herbert was one of the earliest black students at the University of Chicago before completing his graduate and postdoctoral studies at MIT. Like Ghulam, Herbert was well acquainted with the challenge of being the conspicuous other while working toward academic excellence. His continued publications in leading physics journals contributed to his success and prestige at Bell Labs, Murray Hill.
(SOURCE) "Panjabi USC2000 PHS". Licensed under CC BY-SA 3.0 via Wikimedia Commons http://commons. wikimedia. org/wiki/File: Panjabi_USC2000_PH S. svg#mediaviewer/File: Panjabi_USC2000_PH S.svg
Punjabi American. (2014, August 16). In Wikipedia, The Free Encyclopedia. Retrieved 23:08, February 5, 2015, from http://en. wikipedia. org/w/index.php? title=Punjabi_Ameri can&oldid=6215463 60
Case Study Bell Labs:
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Courtney was raised as a princess with art, violin, tennis, golf, swimming and even equestrian lessons. She went to an exclusive and expensive independent day school for girls where she was the single black girl in her class.
t first blush it didn’t seem Chip would have much
in common with Ghulam or Herbert but he did. His parents left Ireland in the early 1940s during a wave of mass emigration that formed part of the Irish diaspora, one almost as massive as what occurred after the Great Irish Famine in the 1850s. Anti-Irish, anti-Catholic sentiment in America had lessened by the time Chip’s parents arrived, but it was still present as they set up housekeeping in Pittsburgh. Chip went to Catholic schools with his brothers and sisters and most of the kids in his heavily segregated neighborhood, so the transition to Carnegie-Mellon was hard. Living on campus with really smart kids from around the world, most of whom were neither Irish nor Catholic, Chip felt isolated and different for the first time in his lifeeven though he was still in Pittsburgh.
Courtney’s story really wasn’t that different from theirs but she was certain Ghulam, Herbert and Chip didn’t see the connections. Courtney understood thatshe had a father and two grandfathers. The Great Migration: Second Wave The African-American population rose from 278,000 to 813,000 over two decades in Chicago, IL.
Chip wondered if academic and professional success and acceptance could happen without assimilation. Armed with his PhD in Chemical Engineering, Chip accepted an exciting research position at Bell Labs, Murray Hill anxious to find out.
+77 1940’s +65 %
%
2200 2200
1950’s
African Americans
Courtney’s story really wasn’t that different from theirs but she was certain Ghulam, Herbert and Chip didn’t see the connections. Courtney understood that-she had a father and two grandfathers.
per week
(SOURCE)
pg 129: The Sixteen-Trillion-Dollar Mistake: How the U.S. Bungled Its National Priorities from the New Deal to the Present (Google eBook) Bruce S. Jansson Columbia University Press, Aug 13, 2013
Her father, one of the first black managers at Western Electric, adored her and brought her beautiful dresses with matching coats and hats and “Mary Janes” on his business trips to New York but he definitely had gender issues. Her mother was a contract specialist at a federal defense logistics agency and her parents’ combined incomes made their middle class lifestyle possible, but Courtney’s father still had gender issues and it showed in the difference in his expectations of her older brother. He adored Courtney and her sisters but he respected his one and only son. So Courtney intimately understood the incentive to use academic success to garner acceptance. Her undergraduate years at Wellesley with the MIT exchange program was the best of all possible worlds, but her post-doc work at CalTech was a long, hard slog and while working at Bell Labs had been a lifelong dream, it was turning out to be a bit of a slog too. She wondered, among other things if she’ d have more success with her team if she were “one of the guys.” She wondered how she could help them move past obsessing about a process they couldn’t change to focusing on how to successfully navigating that process.
PN&Ainc It Was More Than Just a Job (…the Unintended Consequences of Change)
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But in retrospect s u o i c e r p d e m e e s it n e e b d a h t h g u little tho g n i n i m a x e n i d expende t h g i m e r u t i t s e how div e h t e p a h s e r y l complete d n a s b a L l l e B f worlds o he t d n a c i r t c e l E Western e, r e h t d e k r o w o people wh om h w r o f s k l o f e th n a h t e r o m s a w t i just a job.
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occupations and 13% of science and engineering degree holders in 2011, than their proportion in the general population, with 26% of U.S. population age 21 and older.
%
Women of Color in Science & Engineering IN STEM OCCUPATIONS
10
%
STEM DEGREE HOLDERS
13 (SOURCE)
STEM Workforce: Race & Gender
Hispanics, Blacks, and American Indians/Alaska Natives make up a smaller share of the science and engineering workforce, with 10% of workers in science and engineering
TOTAL US WORKFORCE (WOMEN)
NSF, Science & Engineering Indicators, 2014; NSF, Science & Engineering Indicators, 2012).
%
GP (OVER 21))
26
%
Case Study Bell Labs:
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ourtney thought about some assigned reading
from an organizational development elective. The book, My Years With General Motors, was written by Alfred Sloan, of MIT’s Sloan School of Management. Sloan describes the great industrialist Henry Ford with this simple sentence,
"The old master had failed to master change." Courtney wondered if her team and in fact Bell Labs and AT&T would fall victim to that same failure by trying to hold onto an admittedly illustrious past that could not be duplicated. In 1974 AT&T’s $26 billion in revenue was more than 1% of the entire U.S. gross domestic product. Its $75 billion in assets, 100 million customers
11 10 10 fewer than than fewer in in
employed employed
& &
scientists scientists engineers are minority minority
women women
and 1 million employees dwarfed General Motors. And AT&T spent 2% of its gross revenues, about $500 million on research and development at Bell Labs and even more at Western Electric. In fact, 4 cents of every one of those $26 billion dollars went to research and development at Bell Labs and Western Electric. That level of R&D funding made anything possible,
but that level of R&D funding could never happen again at Bell Labs. Courtney had to figure out how to get her team out of the rear view mirror and start looking forward.
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It Was More Than Just a Job (‌the Unintended Consequences of Change)
in 1974 s s o r g s t i f o % AT&T spent 2 n o n o i l l i m 0 0 5 $ revenues, about bs a L l l e B t a t n e m p o l e v e d d n a h c resear . c i r t c e l E n r e t s e W t a e r o m n e v and e e s o h t f o e n o y r ve e f o s t n e c 4 , t c In fa h c r a e s e r o t t n e w s r a l l o d n o i l l i b $26 d n a s b a L l l e B t a t n e m p o l e v e d and D & R f o l e v e l t a h T . c i r t c e l E n r e West t u b , e l b i s s o p g n i h t y n a e d a m g n i fund er v e n d l u o c g n i d n u f D & R f o l e v e that l y e n t r u o C . s b a L ll e B t a n i a g a n e happ m a e t r e h t e g o t how t u o e r u g i f o t had art t s d n a r o r r i m w e i v r a e r e h t f out o . d r a w r o f g n i k loo
Case Study Bell Labs:
1
You are part of the consulting team assigned to help Courtney. Please assist in the following:
2
Courtney is literally in the middle and has two communication challenges rife with potential conflicts. One area of challenge is with her team (Ghulam, Herbert and Chip) and the other is with her manager and senior staff. How should she prioritize her focus? Which group should she address first? What are the key issues she should address and resolve in each area?
3
“Unfettered research is no longer a logical or necessary investment for a company… it takes far too long for an actual breakthrough to pay off as a commercial innovation.”
4
As it becomes obvious that change is the only constant, what is Courtney’s role in helping Ghulam, Herbert and Chip adapt and be successful in the midst of the massive funding shifts at Bell Labs?
Andrew Odlyzko, Bell Labs Researcher, Mathematics Department, 1995.
If this is true, what are some ideas on how important research might go forward even if not “unfettered”? Does the belief, “this is more than just a job” require unfettered research?
Should Courtney encourage them to consider other employment options, maybe in academia or Silicon Valley?
How might AT&T’s quasigovernmental “cradle to the grave” employment traditions have contributed to the adjustment challenges of divestiture? Is there an unstated sense of entitlement? How might that impact her team’s willingness to accept changes that come unannounced, seemingly from “on high”? How might Courtney address this issue with her team? With her managers?
PN&Ainc It Was More Than Just a Job (…the Unintended Consequences of Change)
5
6 How can Courtney’s
What additional
management team
questions do you
contribute to her
have for Courtney,
efforts to maximize
her team and her
productivity within
managers?
her research team despite funding
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changes?
Case Study Bell Labs:
2014
PN&Ainc It Was More Than Just a Job (‌the Unintended Consequences of Change)
2014 © PN&A inc
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e h …t d e d n e t n i Un s e c n e u q e s n Co e g n a h C of