Management Case20141031

4832 words 20 pages
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REV: APRIL 23, 2012


Pierre Frankel in Moscow (A): Unfreezing Change
In April 2007, Pierre Frankel – the Deputy Managing Director of Russia for H-IT, a global information technology company – reviewed résumés in search of a native Russian to help him lead the subsidiary’s turnaround. A French national, Frankel considered the fact that he was engaging in such an activity in his current office as a small but notable victory since arriving three months earlier.
Corporate executives had sent Frankel from the company’s headquarters in Zurich, Switzerland to
Moscow, Russia in January 2007 with the difficult task of turning around a top-priority subsidiary – while not holding the top position.
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“One of the people who really brought me into the project and sold me the story left me alone,” Frankel said. “At that point I could have said, ‘Here is my badge, I will go home, do it yourself’.” But Frankel had worked so hard that year as VP of Operations in Zurich and the years before, he felt compelled to build on that base and accept the challenge.
The business plan project had given Frankel some familiarity with the organizational dynamics in the Russia subsidiary. The company had fired the last two MDs due to opaque business practices.
Sergei Lebedev, the current MD, had come from a direct competitor and, prior to that, had worked for over 10 years with the Russian secret service. He had studied at a respected university, possessed good communication skills, and was fluent in English, which eased interactions with corporate management in Zurich. Yet Lebedev had never held a top management position before. Although the subsidiary continued to underperform with his leadership, corporate executives were reluctant to replace him given the difficulty of finding another candidate with the requisite skills – an experienced leader in the industry with a good network of relationships with top Russian managers and officials.
Furthermore, H-IT had a general preference when making changes to do so via evolution, not revolution. Corporate leaders encouraged Lebedev to hire a number two