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THE SCIENCE OF THE DEAL: ROBBINS-GIOIA KEPT THE AT&T/NCR MERGER ON TRACK

 THE SCIENCE OF THE DEAL:
 ROBBINS-GIOIA KEPT THE AT&T/NCR MERGER ON TRACK
 ALEXANDRIA, Va., Aug. 3 /PRNewswire/ -- In the spring of 1991, officials at Robbins-Gioia, Inc., received a surprise telephone call from NCR Corporation in Dayton, Ohio. The two companies weren't strangers to one another -- in fact, as experts in project- management, Robbins-Gioia had for some time been looking for an opportunity to assist the computer maker in its product-development efforts.
 Now the Alexandria-based company was about to get its chance. Except NCR didn't want assistance on a product effort. It needed help on a deal that was the buzz of Wall Street.
 NCR at the time was in the process of joining forces with telecommunications giant AT&T in what would become the biggest corporate merger of the year -- a $7.4 billion stock swap hammered out after long and arduous, sometimes hostile, negotiations.
 Even with calm restored at the two companies' respective board rooms and a deal in place, however, the saga was far from over. Although AT&T was the acquiring company, it was NCR that would absorb AT&T's computer division into its own worldwide operations. That task was daunting, especially considering the job was supposed to be done within three months, before the merger was scheduled to officially close in September.
 That phone call proved to be fortuitous for Robbins-Gioia. With a project team of just five employees, Robbins-Gioia bunkered down in NCR's Dayton offices and didn't come up for air until the project was done -- 90 days later. Working behind the scenes, and beyond the glare of the media spotlight, with a team of a few dozen NCR employees, R-G helped bring operations-level success to a merger many on Wall Street and in the financial press believed was doomed to fail.
 More significantly, Robbins-Gioia, which got its start helping the U.S. Department of Defense manage massive automation projects, gave the corporate world its first taste of a radically different method for managing mergers -- one which superseded the usual volatile stew of bureaucracy, competing personalities and guesswork with a dispassionate measurement of tasks, time and resources, all aimed at completing the job without any surprises.
 Robbins-Gioia, in other words, effectively replaced what Wall Street romantically refers to as the "art of the deal" with something entirely new, and far more reliable: the science of the deal.
 "They brought in very quickly what I would call a SWAT team," said Jim Walworth, who then was NCR's project manager on the deal and now serves as the computer maker's assistant vice president of logistics. "This was a deal that impacted operations worldwide -- a massive undertaking ... in a very short period of time. It required a very structured expertise, which (R-G) brought to bear immediately. They were quickly regarded as knowing exactly what they were talking about."
 R-G brought three things to the AT&T/NCR deal: A proven process for managing large-scale projects, a team of professionals to help the client execute those procedures and the company's own proprietary software, capable of tracking and analyzing all the data relevant to the transaction.
 "Neither company had that kind of skill," said John Gioia, R-G's chief and co-founder, of the methodology used in the AT&T/NCR deal. "They did traditional management, traditional manufacturing. That's what they're good at. But they didn't have experience with that extraordinary, one-time thing."
 R-G treated the merger as a stand-alone project, rather than just another event (albeit an extraordinary one) in NCR's day-to-day operations.
 Tex Carey, a Robbins-Gioia project manager who helped spearhead the AT&T/NCR contract, remembered the intense pressure NCR was under to quickly get a handle on the merger and all that would be required to make it succeed.
 "In the beginning, the first job was to simply identify all the work that had to be done," Carey said. "It was such a big transaction, and I remember (NCR) saying, 'Look, have we even identified everything we have to do yet?'"
 R-G did identify all the required tasks, as well as all the available resources that NCR could use to carry them out. Those two elements then were used to establish a timetable for getting everything done, with no guesswork involved.
 All that information was logged into R-G's Control and Analysis Tool, or CAT, a Unix-based, fourth-generation-language software program.
 CAT, a sophisticated project-management tool, helped R-G and the NCR employees working on the project analyze the progress of the project. If one task among many, for example, was completed later than expected, or would require extra resources to keep it on track, R-G used CAT to help determine precisely how that change would affect the project as a whole and identify the proper response, thus allowing NCR management to eliminate problems before they became problems.
 In short, R-G gave NCR a luxury unheard of in the history of corporate mergers: The ability to know precisely where everything stood at any given hour of each day. As a result, NCR was able to anticipate every step it needed to take, and the deal was done on time, with no service interruptions for its or AT&T's customers -- a remarkable resolution for what began as a hostile takeover attempt by AT&T.
 Ironically, Robbins-Gioia was itself an unlikely candidate to manage the merger. Best known for its work on military and other government contracts (John Gioia previously had overseen computer- automated projects for the Air Force in the 1960s and '70s), the privately held, $25 million company was a stranger to mergers and acquisitions. Consulting work on large corporate mergers traditionally has been the exclusive domain of special divisions of Big Six accounting firms, and Robbins-Gioia wasn't an accounting firm at all.
 In fact, it wasn't the brass at AT&T or NCR that first thought of seeking out the company's services: R-G was recommended by NCR's technical staff, which was familiar with the Virginia company's project-management philosophies.
 At that point, too, NCR was ready to try something different. It had been in discussions with the consulting division of one of the country's Big Six accounting firms, but found its proposal too grandiose and time-consuming.
 "I evaluated several other outside candidates," said NCR's Walworth. "But they basically were unable to really come in quickly and apply the right techniques. They wanted to study the situation and establish a relationship with us. They were offering consulting services."
 That's exactly what NCR didn't want. The company knew what it wanted to do -- what it had to do -- and needed help executing. All of which was fine with Robbins-Gioia, which offers project management, not consulting services.
 "R-G came in and we talked," Walworth said. "They just understood what needed to be done and were able to come in and implement immediately. They didn't want to influence our decisions. They just provided management techniques."
 Even so, NCR was concerned by Robbins-Gioia's small size and lack of experience in the mergers and acquisitions field. Still more problematic was R-G's outsider status: How could NCR and AT&T know that their trade secrets and other confidential information would be safe with Robbins-Gioia?
 Gioia pointed out that his company lived and died by its reputation, which was based solely on the success of its clients. He argued that confidential data probably was safer in his hands than in the hands of an employee who might be disgruntled over the merger.
 That logic proved persuasive, as did R-G's assurances that the project-management methods it used to help government and industry cope with massive, long-range tasks could be effectively translated to a merger on a staggeringly tight schedule.
 "We didn't come with any preconceived ideas," said Gioia. "I think we got the job because we told them we had no motive other than to get this job done."
 Less than a week after its first meeting with NCR, R-G had its project team in place at NCR's Dayton offices and began structuring a path for a merger involving 55,000 employees, 450 projects around the globe and some 3,000 related activities companywide.
 Said R-G's Carey: "The greatest risk was the extraordinary time pressure placed on the project. We were working 14- to 16-hour days, six to seven days a week. I told someone I didn't even know what day it was, except that I when I'd drive by a church and see the people coming out, I knew it had to be Sunday."
 The staggering project might have been exacting a heavy toll on the personal lives of those involved, but the work stayed on target as the summer passed, and the operations-level aspects of the merger were completed on schedule.
 I'm not sure how it would have turned out without Robbins-Gioia's involvement," said Walworth. "But I can say that they enabled us to eliminate surprises that could have derailed the effort."
 Perhaps the biggest endorsement for R-G's work on the deal is AT&T's strong revenue and operating income record since last fall, and, more significantly, the conspicuous absence of any reports of disruptions or other problems between AT&T and NCR, or their customers, since the merger was completed. Fitting, perhaps, for a project-management company whose role in the biggest merger of 1991 never made headlines.
 -0- 8/3/92
 /CONTACT: T.W. Fitzgerald for Robbins-Gioia, 703-548-7006/ CO: Robbins-Gioia, Inc.; NCR Corporation; AT&T ST: Virginia IN: SU:


TW -- DC001 -- 5945 08/03/92 07:32 EDT
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Date:Aug 3, 1992
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