How Oldsmar got global influence

OLDSMAR

In 2006, Nielsen, the company that does the TV ratings and has its global operations center here, was bought by a group of six private equity firms for just under $10-billion.

The new owners had taken on $8-billion in debt and wanted costs cut. Four thousand layoffs were announced worldwide.

Not long after, Nielsen Web developer Duff Campbell, 34, of northwest Hillsborough County, came to work and was laid off by his boss, who was crying.

Within days, Nielsen signed an agreement with Tata Consultancy Services, a huge Indian information technology firm. The deal was blinking-neon big: 10 years, $1.2-billion.

And a few months after that? Nikhil Asopa, 37, born and raised in Jodhpur, India, began work in Oldsmar as a manager for TCS at Nielsen.

By spring, this sequence — Nielsen workers out, TCS workers in — had reached a point of critical mass. People started to notice Indians standing at a bus stop on Tampa Road, in a town that in the 2000 census was more than 90 percent white. They had packs on their backs and iPods in their ears.

This prompted an e-mail to the city from a woman complaining about "an influx of foreigners."

"Come to find out," the woman wrote, "that they are here to train so that American jobs can be sent over to India.

"This is an outrage."

The economy is listing. A presidential election looms. Globalization, outsourcing, off­shoring: These terms come up a good bit. They conjure hazy images of expensive sneakers being made on the cheap in some faraway land most Americans couldn't find on a map.

But this is not the outsourcing story you've read before.

The woman who wrote the e-mail had it half-right.

The jobs aren't going over there. At least not right away.

The Indians are coming over here.

What we have in Oldsmar is a case study in what happens when the global economy meets a local reality.

It's not a simple thing.

• • •

R.E. Olds, who started Olds­mobile, established this town in 1916 because he sensed this piece of land was going to be at the center of something big.

He thought Oldsmar could be a heck of a shipping port — if not for the low tide. He drilled for oil — found saltwater. A hurricane blew through, the Gandy Bridge was built, the land boom went bust, and Olds pulled out, $3-million poorer, the town's population in the mid '20s somewhere between 80 and 200.

Oldsmar just kind of sat there for most of the rest of the 20th century. It had plenty of dirt streets as recently as the 1990s.

Then Oldsmar began to grow, in a familiar, paved-over way. Tampa Road went from two lanes to six. Cue the Wal-Mart Supercenter. Cue the Chili's, the Sonic, the Chick-fil-A.

But Nielsen's arrival was growth of a different order. In 2003 the company brought 1,200 jobs, many of them well-paying, to its new, 600,000-square-foot, hurricane-resistant, $120-million facility and in time added some 600 more jobs.

Nielsen's arrival was such a big deal that Jerry Beverland, the town's jeans-wearing mayor, put on a suit for the ribbon-cutting. He called it "a match made in heaven" and a "gold mine."

Nielsen had moved from Chicago to Dunedin in 1972. You know Nielsen. Most of us think of the TV ratings, but the company measures a lot of what we consume, whether on TV, a computer monitor, a cell phone screen, or in the aisles of a store. The information Nielsen gathers, crunches and sends to clients is used to determine how billions of advertising dollars are spent every year. The company itself brought in $2.5-billion in revenue in the first half of 2008. Nielsen, a recent feature in Fortune magazine said, is on "a quixotic-sounding mission to measure the world."

People in the Tampa Bay area might think of Nielsen as a local company, but it has its head­quarters in New York. It has about 34,000 employees working in more than 100 countries.

Nielsen can be everywhere because it deals in information, a commodity that jumps political and national boundaries as if they're not even there.

This business of measuring the world has gotten more complex than you could know, what with 11 broadcast networks, countless cable channels, DVR, TiVo, the Web and cell phones. Nielsen executives say the past five years have brought more change than the 25 that came before them.

The company has had a hard time keeping up. By February 2007 Nielsen's delivery of its TV ratings was late often enough that the company sent a letter to clients apologizing. But the new owners still wanted to cut costs.

"We can't do it all by ourselves," Nielsen executive vice president Susan Whiting said last month.

Enter Tata.

Imagine a company that is Volvo, Marriott, Rolex and IBM rolled into one. That's the Tata Group. The conglomerate, based in Bombay, India, has been around since 1868 but got gargantuan only last year, with the purchase of Anglo-Dutch steel maker Corus for $12-billion.

Tata Consultancy Services, the Tata Group's sprawling IT outfit, has more than 116,000 employees, who are everywhere. Mexico. Uruguay. Budapest. The biggest North American "software delivery center" is in a new building off an interstate loop road in suburban Cincinnati. Outside: the Clermont County flag, the Ohio flag, the American flag, the Indian flag. Inside: banners in an atrium that say hello in eight different languages.

Namaste is right.

The man who brought Nielsen and TCS together is Mitchell Habib.

• • •

Habib grew up in the non-glitzy end of North Miami Beach. A University of Florida grad, he has been a chief information officer for divisions of Ryder, General Electric and Citigroup. His office with Nielsen is in Covington, Ky., across the Ohio River from Cincinnati, and his windows look over onto the stadium where the Reds play. The Great American Ballpark.

One afternoon last month he sat on a leather couch. He had on a dark pinstripe suit and wore shiny blue cuff links.

He said he has spent only 19 full week days in Cincinnati this year. He has been married for 25 years and has two daughters with whom he iChats.

"In the old days, geography was king," he explained. But now: "We sell all over the world. We generate income all over the world. So we're going to leverage talent all over the world."

Habib speaks quickly and excitedly in a language that could be called boardroom.

Leverage means use.

Talent means people.

He said negotiations for the $1.2-billion deal with TCS happened in Covington, in New York, in Chicago, in Oldsmar. He had partnered with TCS before. Five years ago, when he was at GE Medical Services, he was able to "save 50 percent through outsourcing to TCS alone," he said then. This is the kind of thing that makes people get on Internet message boards and call him "the Prince of Darkness." To the Nielsen deal, TCS brings technical experience but also "key-punching functions" — data entry, software testing, desktop support.

"I'm much more empathetic than people give me credit for," he said, "but at the end of the day it's fairly generic work."

Last year, Nielsen laid off 117 employees in Oldsmar; an additional 120 have been let go in 2008, with 30 to come by the end of the year. More will be laid off in early 2009. How many more? Hasn't been determined.

Nielsen says last year's layoffs were not directly related to the deal with TCS. The employees, according to Gary Holmes, a Nielsen spokesman in New York, were "severed" as part of the overall cost-cutting mandate.

At this point, though, there are approximately 220 TCS employees working for Nielsen in Oldsmar. They are here on various kinds of short- and longer-term work visas. About 50 of the 220 are former Nielsen employees who were rehired by TCS.

"There were other people who were very knowledgeable and had made great contributions to the company," Habib said in his office, "but that's not to say they weren't replaceable."

Think of it this way: When TCS workers are in Oldsmar, they earn wages and benefits similar to what Nielsen's American workers get. But some of the TCS people don't stay for long. Right now, TCS workers are doing work for Nielsen in Calcutta, Bombay, Chennai and Budapest. One day that could be Guadalajara, Mexico, or Montevideo, Uruguay. It's cheaper to employ somebody in those places than in Oldsmar.

This arrangement helps Nielsen save money.

"Which I'm not embarrassed by," Habib said.

How much money?

"It's significant," he said.

You could call this outsourcing, offshoring, or any number of other names, but people like Mitchell Habib don't use these terms. They're "antiquated," he said, because they presuppose one center of business activity, one central factory, one central country, from which business could be sent. It's not like that anymore. The world is everywhere. There are no boundaries because there is no center.

The authors of the recent book Globality posit that at this point everyone is competing with everyone for everything everywhere.

"Any individual employee in the macro sense is no better than any other employee," Habib said in his office. "That's not the issue. The issue is the breadth and depth TCS gives us. … Is it an individual at TCS that makes a difference? No. It's that they have 110,000 engineers who can help me do better."

"It's not about Jane Doe or John Doe," he said.

Or Duff Campbell.

• • •

Duff Campbell grew up in Palm Harbor. Parents of his classmates came in on career days and talked about their jobs at Nielsen.

"At some point, in high school," he said, "I thought, 'I'll go out in the world and get my experience and come back to work at Nielsen.' "

He majored in visual arts at Florida State. He interned at Universal Studios in Hollywood. He worked on film production for documentaries and movies with stars like Charlie Sheen and Kiefer Sutherland. Then he studied Web development and design.

Nielsen hired him in May 2001. He developed Web applications to give clients local TV ratings and information.

He and his wife bought a house in Hillsborough. They had two children. They put an addition onto their house.

"I really saw a future with the company," he said.

Mitchell Habib was hired in March 2007.

He came to Oldsmar and was charismatic at his first meeting with employees. Campbell said Habib told them he had been hired to find "redundant processes" in the company. Employees were uneasy about Habib and what he was going to do.

"He's definitely a numbers guy," Campbell said.

But Campbell figured he was safe. He got good reviews, he said, and made $85,000 a year.

Last September, though, he noticed upper management had less to say to him. One night he woke up with a bad feeling and went to work that morning, braced for what he thought was coming.

When he got to the office, his supervisor, a man with whom he had been to baby showers and birthday parties, was waiting for him, in tears.

"I think it hit him that this is really happening," Campbell said. "It's going to affect a real family out there."

Mark Wasserman, 45, of Safety Harbor, a computer programmer who had been with Nielsen for 15 years, left on his own. He couldn't take it anymore. He said he began to feel like he was working in a foreign country.

"It got to the point that getting on the elevator or walking down the hall," he said, "I didn't know anybody."

He was always wondering: Am I next? He found new work as a consultant and said he was glad to get out.

"Mitchell was trying to deny that anyone has any knowledge or value at all," Wasserman said. "Basically, he was saying, 'You are all faceless.' "

Two months after Campbell was laid off, Nikhil Asopa, the 37-year-old from Jodhpur, India, started work for TCS in Oldsmar.

He has been with TCS since 1998.

He had gone to university in India, earning an undergraduate degree in engineering and a graduate degree in business. At an interview with a firm that was going to place him in one of India's many growing IT firms he was asked if he had a location preference. He answered quickly:

None.

In his 10 years with TCS, Asopa has worked in Bombay, India; Salzbergen, Germany; Schaumburg, Ill.; Schenectady, N.Y.; Richmond, Va.; Marietta, Ga.; and now Oldsmar. He speaks English and Hindi and some German. Before working for TCS for Nielsen, he was working for TCS for General Electric. Now he is in charge of more than 100 people who work in the applications development department for TCS at Nielsen.

He was in Georgia for two and a half years, Illinois for two and a half years, New York for a year, Virginia for three months.

Asopa has seen a lot of this country. He likes it here. He didn't like the cold in Chicago, he said the other day at a Starbucks, and he didn't like the snow in Albany, but he has found the United States to be convenient and cordial. Americans hold doors, he said. Americans say hello.

He lives in a second-floor apartment at Egret's Landing in Palm Harbor with his wife, who's a homemaker, and his 7-year-old son, who is in the third grade and wants to be a "space scientist" when he grows up. The family goes to Clearwater Beach and Disney World and bowls at Countryside Lanes on U.S. 19. His wife likes the education system here.

"But as part of my job," he said, "I don't see any particular place as my home. If my company asks me tomorrow to go to the Netherlands to work, I'll go; if they ask me to go to India, I'll go.

"Mine," he said, "is a transferable job."

• • •

Campbell out, Asopa in — that happened for months inside the walls of Nielsen before any of it became apparent in Oldsmar. The bus stop at Tampa Road started getting busier, people started talking because Oldsmar's still that kind of place, the City Council members started getting phone calls, and all this led to a tense April 15 City Council meeting.

"I'm furious," council member Sue Vale said. "I think it's disgusting."

"This is preposterous," council member Janice Miller said.

"I've seen a half-dozen examples of what Nielsen has done walking around the street today," council member Greg Rublee said.

This led to letters to the editor about "alien workers" and how Nielsen had "double-crossed" Oldsmar.

"I take great umbrage," one man wrote, "that our citizens should be welcoming these Tata workers. I will not welcome anyone who affects my family's security."

The city asked Nielsen to give up $3.1-million in future tax incentives. The company agreed, not because it had violated the agreement, but because of the bad press and to keep the peace.

The concession didn't prevent blustery CNN personality Lou Dobbs from opining on his show:

"I got to tell you people — you know what? — if the people there in Florida think this is fine, then they're going to be part of the reason that the quality of life and the standard of living in this country continues to decline because Nielsen doing this, shouldn't even be allowed to rate U.S. television networks and broadcasts, period.

"I mean, how dare them?"

The Lou Dobbs bit spawned more e-vitriol. "Unpatriotic." "A TOTAL DISGRACE TO THIS COUNTRY."

Then Mayor Jim Ronecker said something remarkable at a city workshop: "It's not all about America anymore."

• • •

People could take all the umbrage they wanted, but the mayor had a city to run.

Ronecker sent an e-mail to a man who had written an angry message.

"Here lies my dilemma," the mayor started.

He wrote that Nielsen was "extremely vital to the economic health of our city." That the 1,300 "American" jobs that remained were good ones. That if the city raised too much of a fuss, causing Nielsen to leave, that would bring "a whole lot of misery" to even more families.

"I am really in a no-win situation it would seem," he wrote. "Do I pile on along with everyone else or do I try and save 1,300 jobs and look like a bad guy in the process?"

Nielsen is by far the biggest employer in town. Oldsmar doubled its property tax revenue from 2001 to 2007, and Nielsen was a big part of that.

Down Shore Drive, Beverland, the jeans-wearing, ribbon-cutting former mayor from 2003, sat at his kitchen table in a T-shirt that said THESE COLORS DON'T RUN and said:

"Am I happy with Americans losing their jobs?

"No.

"Am I glad Nielsen is here?

"Damn right I am."

• • •

Is this good for Oldsmar?

Is this bad for Oldsmar?

Could it be both?

Here are a few things to consider:

Property taxes have gone down. Only by a little, but they did. That was because of the tax incentives Nielsen gave up.

At the Abbey, the apartment complex where many of the TCS workers livers live, crime has gone down, according to the Pinellas County Sheriff's Office. It's hard to say whether that's because of the Indians.

Ridership on Pinellas Suncoast Transit Authority bus Route 93, which goes from the stop by the Abbey to the stop in front of Nielsen, has gone up 55 percent.

Over at Oldsmar Elementary, according to the principal, seven new students this school year are from India. One father serves on the school's advisory council.

Last month, a top TCS executive gave a presentation about his company at an Upper Tampa Bay Chamber of Commerce lunch­eon. The chamber people ate filet mignon and fudge cake and came away impressed. They had no idea TCS was so big, or so charity-minded. Here, in the past few months, TCS workers have volunteered with Habitat for Humanity, the American Cancer Society and the SHARE Florida Food Network.

"We don't get upset about new buildings," said Jerry Custin, the chamber boss, "so why do we get upset about new faces?"

Here, perhaps, is why.

In 2003, Oldsmar contributed to the tax incentives package that was supposed to encourage Nielsen to create jobs at its new location. No one ever said jobs for Americans, but they meant it.

"If you're going to have a factory in India, employ Indians," said Janice Miller, the council member. "If you're going to have a factory in America, employ Americans; if you're going to have a factory in France, employ French.

"When in Rome, you know?"

Mitchell Habib said: "It shouldn't matter where you work. You shouldn't care about where they come from or where they are."

Except people do care.

The financial equation works.

The human equation is always more complicated.

• • •

Campbell, the laid-off Nielsen Web developer, found work quickly, mostly short-term contracts. He eventually started his own Web development company. It took him nearly a year to get back to his original income.

He had interviewed for jobs in other cities, but he has family ties here and he didn't want to be a weekend husband and father.

"My family and my kids mean too much to me," he said.

One evening earlier this month, Asopa, the TCS worker who runs the applications develop­ment department in Oldsmar, drove from work home to his apartment in Egret's Landing.

He sat down on the couch. His wife prepared fresh ginger tea with milk. He asked his son how school was.

"Was your teacher happy with you?" he said.

"Yes," his son said.

They ate Indian pistachio pastries and Frito-Lay Stax cheddar-flavored chips. The walls were bare save for a framed collage of pictures of his son at preschool outside Atlanta, a poster of dolphins that said HARMONY and a silver and black plaque Nielsen had given Asopa.

"Thank you for your drive, delivery, and outstanding client service," it said.

Sometimes, said Asopa and his wife, it's hard to keep moving to new places.

But still.

"If you don't have that flexibility," he said, "there's a constraint.

"I have seen people leaving their jobs because they cannot move. It's a global competition. Everyone has to do something new to prove his worth. Geographic boundaries should not be a reason you're not able to prove your capabilities."

There has always been an unspoken social contract between an American worker, that worker's company and that worker's place. Work hard, be rewarded, know your neighbor.

Campbell was loyal to Nielsen. He expected Nielsen to be loyal to him. Movement means instability.

Asopa is loyal to TCS. What he expects in return is a chance to keep working. Movement means opportunity.

• • •

John McCain said this in his speech at the Republican National Convention: "We're going to help workers who've lost a job that won't come back find a new one that won't go away."

At the Democratic National Convention, Barack Obama said "business should live up to their responsibilities to create American jobs, to look out for American workers."

Scott Wilson, a partner at Clearwater's Brown-Wilson Group, which puts out The Black Book of Outsourcing, hears these things and has to remind himself that "they're just talking politics. They're not telling you what's really going to have to happen.''

"We as a society are going into this outsourcing kicking and screaming," Wilson said. "But we live in a global society, and that's all there is to it."

That doesn't make losing a job any easier. Last month some laid-off workers from Nielsen and some workers who were expecting to get laid off got together at Eddie's Bar and Grill in Dunedin. Many of the 30 couldn't give their names because of the terms of their severance packages.

One woman said she thought she was going to work at Nielsen until she died, or retired, whichever came first.

"It's profits over patriotism," retired Nielsen employee Walter Patt of Pinellas Park said.

Mitchell Habib doesn't apologize for making money for his company. Nielsen reported revenues in the second quarter of this year that were 12 percent higher than the revenues for the second quarter of last year. The work, he said, is also getting done better: Overnight ratings delivery has improved 72 percent.

So the deal is working, at least for the bottom line.

How that feels inside Nielsen is another question.

Habib came to Oldsmar one day this month for three global teleconferences with Nielsen employees. That evening Nielsen organized an NFL game-watching party meant as a morale boost for employees. "We haven't done enough of this kind of thing," spokeswoman Amy Rettig said.

It had been a hard day for 40 employees in the department called Software Quality Assurance. They had been told they might get laid off in the coming weeks or months, and that they — like others before them — might have to train their TCS replacements.

Now, in the evening, the cafeteria inside the building was decorated with Mylar balloons shaped like footballs. Outside there was a 13-foot-by-10-foot LCD screen with the game about to start.

Habib got up on a stage in front of the TV. He had on jeans and a blue blazer and loafers.

"Good evening!" he said into the microphone.

Some clapping.

About 500 people had RSVP'd. The crowd didn't look that big.

"GOOD EVENING!"

More clapping.

People sat at tables and ate hamburgers and potato salad out of Styrofoam clam shells. They drank Bud Light and Michelob Ultra and chardonnay. Two-drink limit.

At halftime Habib gave out free Bucs tickets. Then the big prize: tickets to this year's Super Bowl in Tampa. He held them up.

He paused.

The crowd was silent.

"This is the easiest way to get you guys quiet," Habib said. "We just figured it out."

Some laughs. Some groans.

Habib gave the tickets to the winner and then walked off the stage and into an elevator. He had talked to European employees in the morning and employees in the Americas midday. Now it was time to talk to Asia.

Over there it was already tomorrow.

Times photojournalist Douglas R. Clifford, multimedia reporter Catriona Stuart and researchers Caryn Baird and Shirl Kennedy contributed to this report. Michael Kruse can be reached at mkruse@sptimes.com. Theresa Blackwell can be reached at tblackwell@sptimes.com.

How Oldsmar got global influence 09/19/08 [Last modified: Thursday, September 25, 2008 12:06pm]

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