Case 16.1 Team Crisis Within the Gates Axis Global is a giant oil and gas company that owns nine refineries worldwide and is headquartered in Paris, France. Axis Global's refineries convert crude oil into gasoline, jet fuel, and other products, and each refinery has an information technology (IT) team located "within the refinery gates" that reports to the refinery's management team. Each IT team is responsible for the operation and maintenance of computers and applications that are critical to the safe and efficient operation of its refinery.

In addition to refineries, Axis Global owns and operates oil wells, pipelines, chemical plants, and gas stations across the globe. As a result, some IT operations are standardized across the company, and a centralized team located in Paris makes those decisions for all the IT teams in the company. Recently, the centralized IT organization concluded that IT services company-wide should be outsourced to a third party. Outsourcing means most of the company's IT personnel are no longer employed by Axis Global, and the third party will decide which, if any, of Axis Global's IT employees it will retain, replace, or terminate.

Axis Global has recently notified the Tappan Refinery in Pennsylvania of the global decision to outsource all IT teams. Top executives at the Tappan Refinery are unhappy with the decision because they were not consulted before the decision was made and few details were provided to Tappan's executives on how the outsourcing would be implemented. In addition, these executives are worried that the decision will negatively affect essential tasks performed by Tappan's IT team and result in increased costs. The management at Tappan Refinery is opposed to changing its current IT operations.

Russ Saffold manages IT at the Tappan Refinery and has three members on his team: Alejandro Salis, Samantha Umbia, and Todd Greengold. The IT team is well respected by everyone in the refinery, and their interpersonal relationships are solid. All four team members are officially employees of Axis Global and physically work within the refinery gates at Tappan. Because refineries are frequently bought and sold among oil companies, the refineries prefer to operate as self-contained organizations (i.e., "within the gates"). They have a bunker mentality vis--vis the larger organization and often see that relationship between a refinery and the parent organization as "us versus them." Employee loyalty is to the refinery, not to Axis Global.

The outsourcing news creates a crisis within Russ Saffold's IT team. Although Russ will remain an employee of Axis, the other three team members will not. The three team members are now unsure of their futures and find it difficult to focus on their work tasks. Alejandro Salis (age 43) is fairly confident that he will be hired by the outsourcing company as he is the "star" on the team. Samantha Umbia (age 31) fears she will be terminated as she is unable to relocate to the outsourcing company's location. Todd Greengold (age 62) is worried that he will lose his stock options and pension if he is terminated or transferred to the outsourcing company. And the entire team worries about how they will be treated by their new employer. Morale of the team members sinks, and with the likelihood of fewer positions, competition among them begins to emerge. Russ finds himself in the middle of implementing a decision that is unclear, is opposed by his bosses at Tappan Refinery, and is creating personal issues with his staff. He wonders how he will establish a working relationship with the outsourcing company.

Questions

1. What action should Russ Stafford take as a leader in dealing with the decision of the parent company, Axis Global, to outsourcing all IT work to a third party? 2. What insights from the team leadership paradigm could help the IT team at Tappan Refinery during this unwelcomed transition? 3. What insights can you offer related to a leadership paradigm different than Team Theory?