Profile: James Martin & Co - The technology of change

Since its humble beginnings in a small office in Wimbledon 17 yearsare organisations for the “wired” world. Mary Huntington spoke to worldwide president and CEO Ben Levitan. ago, james martin & co has come a long way: in 1992 it sold off a large part of the company, James Martin Associates, but now has nearly 700 consultants, 28 offices worldwide and revenues approaching $90m. The company was founded to change the way software was created but with growth has come a broader mission: now it aims to change the way corporations view technology by using it to create business value, and prepare them for the “wired” marketplace.

Says Ben Levitan, who became worldwide president and CEO in January, the firm offers “end-to-end thinking”.

Levitan, who previously worked for Andersen Consulting and Cambridge Technology, joined as North American chief operating officer and president in 1997 after the company had “skinned its knees” on a warehousing project with a large car manufacturer, losing a couple of million dollars. He recalls: “I was taken on as a cross between a turnaround artist and a next generation leader.”

Four years with Cambridge Technology had taken him to senior vice president corporate officer but his view of the future tempted him to move on.

“I thought the game was changing from technology to change and saw the chance to make a bigger impact,” he says. “Cambridge focuses on technology while jm&co is much more broadly focused on change.”

A youthful, energetic and charismatic man, Levitan obviously hit it off with the firm’s eponymous founder, IT guru Dr James Martin, and within a year had been offered the global role.

His first priority was to set up a fishnet strategy, organising the firm’s work in a global project activity matrix, both horizontally, across geographic areas – US, London, Amsterdam, Hong Kong, Manila and Sydney – and vertically in sectors, primarily government, utilities, insurance, banking and finance and supply chain.

Projects include IT consulting, Internet/ intranet development and Year 2000 solution services, data warehousing, process reinvention, financial application package development and implementation and customer information services.

Says Levitan. “We’re getting called a lot about next generation business platforms where we work on a stream of business activity which is underperforming, launching new digital businesses with new processes, new social and customer relationships.” He adds: “It is about value creation rather than cost cutting – which is a lot more fun.”

This “value stream” approach is fundamental to the company’s “Cybercorp” concept which combines corporate change with innovative technology and creative software solutions to optimise businesses for “cyberspace”.

The jm&co business model, says Levitan, has two interrelated threads: creating business value through the innovative application of technology; and owning business change by creating an environment to support continuous change and improvement.

Levitan cites a project to set up WIN, a worldwide insurance network.

“We were dealing with an outside market-changing event: broking in the insurance business. Four firms came together to deal with risk management and how to put together a bid and ask system for insurance indemnity.

We built a network which allows industry lines to be redrawn around technology: it was about facilitating strategic thinking, understanding each stakeholder’s priorities and putting that thinking together and implementing the network – applications, processes, procedures and the launch.”

This end-to-end thinking characterises the company’s work, says Levitan, which tends to involve global activities.

With a presence in 12 countries, an Internet development centre in Virginia, USA (alongside its HQ), a rapid development centre in London and an offshore development facility in Manila, the firm is well placed to handle global work.

North America contributes the largest chunk of the company’s revenue at about 59 percent, but Asia Pacific is a rapidly expanding market, with revenues growing by 62 percent in 1997 and making up the bulk of jm&co’s overall revenue growth for the year of 30 percent.

Recent work in the area has included a ground-breaking smartcard project for the Hong Kong Transportation Authority. Says Levitan: “We were retained after two other vendors had failed. The cost of maintaining the read/write machines for boat, underground and bus tickets was greater than the cost of a new smartcard system. We stepped in and looked at the situation, applied our productivity tools, methodology and our muscle in Manila and got the job done 18 months ahead of schedule.’

And the smartcard system has been so successful that it is scaling up much more quickly than anticipated, he says, with an estimated 85 percent of the travelling public in Hong Kong using the card within the first four months of operation.

“It is the only contactless smartcard system in the world of that scale,” says Levitan, “and it is a game changer: now people are looking at alternative applications around the world, such as parking systems. The people that run the system are the fastest growing bank in Hong Kong because it’s a debit card. You have all that float sitting on all those cards, which is incrementally worked off each day by travellers.”

The project, he says, illustrates one of jm&co’s business drivers: “Because of the scale of business in systems integration consulting more mistakes are being made. We are getting called in increasingly as project doctors.”

Industry change is also contributing, he adds. “We picked the right industries to focus on,” he says. “Globally government is changing dramatically and the same is true in the finance sector, especially in Europe with the Euro. Our industry expertise is driving the business.”

The proliferation of technology in everyday lives, from the Internet to smartcards, is also a business driver, he says. “We are in a sweet spot because people are increasingly relying on technology. There are a bewildering array of choices for executives – that works for us.”

The company’s approach, he says, is that it is not just about technology but also about business objectives. “We say to a client: what’s really valuable to you? Stop and think about how you want your business to operate and what your customers want.”

The company’s ability to service clients operating globally also contributes to its success. “People are looking for the global view but they don’t want to deal with eight partners,” says Levitan. “Customer intimacy is important.”

And the strength of jm&co’s relationships with customers, which include Merrill Lynch, General Accident and Chubb, is demonstrated by the fact that they come back for more.

In 1996 over 60 percent of revenues came from clients with whom the company had worked in 1995, and in 1997 the figure rose to 75 percent.

Says Levitan: “We don’t just give clients what they want to hear. Our people are thoughtful but candid and very committed to results.”

Around 35 percent of jm&co’s recruits are college graduates but the company is increasingly looking for industry experts as its growth continues.

“We would be interested in somebody who can help conceptualise what the equity business is going to be like in Hong Kong in 12 months’ time, for example,” says Levitan.

According to director of growth Stephen Izatt: “We look for a strong willingness and ability to learn, people with a real passion for developing themselves. And we use competency-based recruitment techniques. Skills and experience are just the tip of the iceberg; below the surface are the core competencies and behaviours: the way people do things.”

Once in, the recruits are taught the jm&co way: “We are very results-oriented, and innovative,” says Izatt. The company invests heavily in training, he adds, and has doubled the amount it spends in the last year.

New recruits get five weeks’ training and development at induction centres in Fairfax, Virginia or Manila while experienced people get three. Recruits choose a career mentor and work out a personal development plan with their performance manager.

Every quarter the company undertakes a global employee attitude survey to find out what’s on people’s minds.

Knowledge sharing is important and all employees have access to the company’s intranet, the Wave, which is also, incidentally, its logo. “Consultants can plug into a set of processes and productivity tools that reflect ‘best practical’,” says Levitan. “We are the leading methodology company in the world, according to the Gartner Group.”

Built around these processes and tools, he adds, is a shared community with values based on collaboration, best practical and results. “Lastly we have a focus on key industries: finance, utilities, supply chain and government. Unlike our competitors we don’t have a world domination strategy, we focus on finding and generating value in industries we want to understand – industries that are subject to radical change. The Internet, for example, changes everything about supply chain.”

The company is not looking to move outside its traditional markets at the moment but it may do so in the future, says Levitan.

Growth is very much on the agenda, however, and the company is looking at business opportunities in Northern Europe on a regular basis. “But,” he says, “our expansion plans are more driven by industry skill and focus than by geography now – we are seeing borderless projects increasingly dominate the business discussion. So a sign of our strength is the distribution we have in terms of the increasing accessibility to global talent on an economical basis.”

Joint ventures are an important part of the strategy for growth and have been undertaken in Japan, South Africa, India, Latin America and Japan.

Says Levitan: “We’re finding that the policy of a joint venture which later moves into a subsidiary-type relationship works. The Asia-Pacific currency crisis is giving us new opportunities – in Korea and Indonesia, for example.”

The company takes a fairly sanguine view of the problems in the Far East, where it has seen consistent and substantial growth in revenues. Says Izatt: “We will continue to see peaks and troughs in the region with increasing market rationalisation and a much more Asian-wide approach to doing business, spreading the risk.”

He admits that Jakarta and Bangkok have been pretty tough markets this year and that jm&co has wound down its activities there to tickover, moving staff into other areas.

Many of the firms jm&co is dealing with in the region are global players keen to take advantage of the crisis through acquisitions and mergers.

In Japan, for example, where a number of banks are in imminent danger of collapse, jm&co has seen its highest growth in the last three months, says Izatt. “We have also been working with Japanese clients who wish to improve their business processes and take advantage of Western experience.”

Elsewhere in the region, the firm is actively seeking entry to the Chinese market. “We are looking at Beijing and Shanghai where we are doing some work on distribution networks,” says Levitan. However, he adds, the number of cities is small and the focus is going to be on education and restructuring state industries. “Next generation BPR thinking is highly thought of by the Chinese hierarchy but it’s going to be a long process. It takes a long time to build relationships there: they view everyone as exploiters. But I think China is going to be an important new geography for us.”

He anticipates aggressive growth continuing in all geographic areas with staff growth to match. “We are at the strategic inflexion point,” he says, “where we start to accelerate.”

Vital to jm&co’s plans is its development facility in Manila, where process design and systems work is undertaken for the whole firm, as well as international training. The centre, which was set up in 1985, is expanding and, says Izatt, is the highest quality software production environment that auditor ERG has ever tested.

And the strong work ethic of the staff is matched by an attitude of collegiality and respect, says Levitan. “We are one of the few companies in Manila to give staff stock options.

“If you’re in the technology area and you can’t show how you create high-quality software on a global basis in a lower cost but higher productivity environment like Manila, India, or Ireland – I don’t think you’re in the game.”

Mary Huntington is a freelance journalist

BEN LEVITAN: A LIFE IN 10 QUESTIONS

1. What company would you most like to run, apart from your own?

Patagonia – I love their products (technical gear for outdoor sports) – or Hasbro Toy.

2. What would you do with an extra hour in the day?

Play with my three children, aged seven, five and three.

3. What is your greatest professional regret?

Not predicting that the Internet would change everything.

4. What has given you most satisfaction in your career?

Being asked to become CEO of james martin & co.

5. What was your last cultural experience?

1998 Hong Kong Sevens Tournament.

6. What book are you reading at the moment?

Personal History by Katherine Graham, president of Washington Post Company.

7. Who has had most influence on your professional life?

Too many excellent mentors to name one.

8. What was the last extravagant purchase you made?

Three cases of French wine – to be drunk in 2005!

9. Which public figure irritates you most?

Pat Buchanan, recent candidate in the US presidential elections.

10. If you weren’t a consultant what would you most like to be?

An advertising executive.