DaimlerChrysler restructures its IT management

Von Thomas Hoffman

DaimlerChrysler AG this week announced an IT management reorganization intended to better align the operation with various business units, help drive revenue growth and save money.

As part of the restructuring, which began Jan. 1, Karenann Terrell, former director of international and process systems, has been named to the newly created position of vice president and CIO of the Chrysler Group and Mercedes-Benz North America divisions in Auburn Hills, Mich. She is now responsible for all aspects of IT management in North America, including engineering; manufacturing; sales, marketing and aftersales; human resources; finance and communications.

Susan Unger remains CIO and senior vice president of the parent company.

Michael Gorriz will assume the newly created position of vice president and CIO of Mercedes Car Group and IT management business systems. Joseph P. Bulat, director of global procurement and supply technology systems, will -- like Gorriz and Terrell -- now report directly to Unger.

Terrell said the reorganization won"t affect the size of DaimlerChrysler"s 1,800-person IT staff in North America, but it will produce "an organizational structure that will look very much like our business structure."

The goal of the restructuring, said Terrell, "is really to focus on and deliver value at the business-unit level while maintaining the global infrastructure pieces that have been put in place since the merger" between Chrysler Corp. and Daimler-Benz AG in 1998.

Although the changes are aimed partly at making IT divisions more accountable for business changes -- like the business units themselves -- IT workers and managers won"t necessarily have their individual performance measured against revenue growth and cost savings, said Terrell. "I"ve always believed measurement systems should be applied to things you have direct control over," she said.

Craig Symons, an IT management analyst at Cambridge, Mass.-based Forrester Research Inc., said DaimlerChrysler"s IT management reorganization appears to mirror a similar shift in other IT organizations in recent years toward a federated model. Under that approach, various IT divisions within the same company share IT infrastructure such as data center and networking services, as well as enterprise applications. But each division is separately responsible for application development to support the requirements of the businesses they serve.

One difference between DaimlerChrysler"s approach and that of most federated models is that CIOs from each of the automaker"s divisions now report directly to Unger instead of reporting to business-unit leaders, said Symons. "By doing this, it seems they"re trying to say, "We want to be more responsive to the business," while doing as much standardization as possible while looking at the cost side," he said.

In addition to Terrell, Gorriz and Bulat, Vincent Morrotti, vice president for ITM infrastructure, and three other executives now report directly to Unger. They include Helmut Mahler, vice president -- ITM commercial vehicles and sales; Robert Smith, director -- ITM controlling and supply management; and Eberhard Cluss, CIO of Mercedes Car Group.

Cluss will retire this spring after overseeing the completion of a short-term integration project, said a DaimlerChrysler spokesman.