A little less than three years after its spinoff from IBM, the world's largest IT startup Kyndryl is working on a business model that aims to reverse its inherited business baggage - its fiscal year 2024 results flagged out a focus on reducing low- or no-margin business carried over from IBM - and Kyndryl leaders pride themselves on a culture that has been able to drive operational agility despite its size and geographical spread.

People Matters had the opportunity to meet Xerxes Cooper, President of Kyndryl Strategic Markets, during his recent visit to Singapore, and asked him about that culture. Cooper has been closely involved in establishing the company's business strategy from the beginning as one of the first founding country presidents. 

Some highlights of that conversation included the shift towards agility, the importance of mindset in maintaining that agility, and how that mindset and culture manifests in the way products and services are developed and delivered.

Breaking away from the IBM structure

In 2021, IBM was a company valued at US$100 billion, spanning more than 175 countries. To manage its vast operations effectively, the company developed an intricate multi-layered structure that enabled organisation and efficiency across its numerous geographical divisions. 

But a startup spun off from that company, no matter how big - Kyndryl, one of the biggest spinoffs in the tech industry - can't follow that same structure.

"When we created Kyndryl, we talked with our customers," Cooper told People Matters. "They said: 'Can you keep doing what you do, but can you do it faster? Can you do it in a more agile way? Can you empower the teams that are out there every single day?' And that's how we came up with three of our six core values, 'Flat', 'Fast', and 'Focused'. Then we had to make that line up with the structure."

The result of those conversations was a complete overhaul of the previous structure IBM had set up. Cooper and his fellow business leaders did away with the enormous subdivisions of countries and geographies, and introduced a nine plus one model instead: nine primary countries (Canada, the US, France, Italy, Spain, Germany, the UK, Japan and India) making up some 75% of the company’s revenue, and a single strategic markets segment comprising some 40 countries.

What that did was to empower the teams on the ground to autonomously make rapid, customer-relevant decisions without having to go through multiple layers of approvals or constantly consult with the headquarters.

"You don't need to run a model like this with so much bureaucracy," Cooper explained. "Rather, we focus on offerings. We focus on the best practices. The team is focused on today and on the next day. And our folks love it, because when you need to make a decision, it doesn't have to go across the ocean to New York and go through so many people before coming back."

Keeping people committed to building a new culture

Besides shaping a new strategy, Kyndryl’s leadership set out to build a new culture – one that embraced new leadership behaviors and mindset.  Yet, a few enduring values stayed the same: respect for the individual, valuing people as their authentic selves, building a place where people can grow their skills and feel proud and happy to work.

"Not many people know this, but every one of us who moved from IBM to Kyndryl actively chose it," he said. "When we spun off the business, all 90,000 people who were affected got an offer letter that was no different in terms of compensation from the model they currently had. That was in the middle of the pandemic, when the job market was hot, and everybody could have easily gone out and got another offer. And still almost all of them signed the offer letter because of the communication, because of the vision, the clarity about the purpose of what we wanted to build."

Open and transparent communication, he added, played a major role in creating cohesion and enthusiasm in those early days. Even the six core values of Kyndryl and its culture system were developed through consultation with the employees.

Profession plays a role in establishing mindset

Another reason for why Kyndryl's model got off the ground so quickly and effectively was the nature of the work its employees do. They are practitioners one and all, Cooper said: if not engineers, then people involved in delivering critical technology infrastructure services in one way or another, and that strong front-line, customer-oriented mindset is why people took immediately to autonomy and agility.

"Our teams are willing to step up even when an issue isn't their area of expertise, and work to solve the problem even if it didn't originate with us - that's the mentality we bring to each situation."

But not everyone has that kind of background, nor does every job give the opportunity to build such a mindset. So how does it get baked through the entire culture?

"When we built Kyndryl, we said we were the heart of progress, and we set a mandate for ourselves that we wanted to be the partner of choice and the employer of choice," Cooper said - and then immediately added, "Then we asked: How do you make it real? And that comes back to our leadership behaviours. Flat, fast, and focused is how we engage with each other; restless, empathetic and devoted is how we engage with our customers. Getting these six principles right was what shaped the culture we wanted."

Each day, he said, teams challenge themselves: they get together and ask in what ways are they not operating according to their core values. It creates a balance of empowerment and accountability internally, and that translates into outcomes for customers.

Putting mindset into practice

To illustrate some ways that self-challenging process manifests, Cooper highlighted one of Kyndryl's central AI-enabled operating platforms, Kyndryl Bridge. This platform was launched in September 2022 in response to customer requests for service teams to use data to provide better insights into the overall performance of their IT environments. It gives customers full observability of what is happening with their infrastructure - and it also gives Kyndryl engineers, technicians, and strategists the opportunity to put core values and culture into practice, said Cooper.

"Every day, across our customers, we use the dashboard to benchmark whether we are operating to our highest global standards. And that baseline is continuously updated - we get to reset our definition of success. Today, it may be that 94% of these incidents are handled through automation. Next month, it may be 95%. That's where we get to raise the bar. It brings in the people element, because our people have a chance to view that data, run the analytics, and translate it into insights. It lets our teammates see the entire landscape for our customers every single day, not just across the scope of a single geography but worldwide."

Using that data, team members are challenged to come up with three ideas daily for improving the service they provide or some part of the customer's landscape, and on a weekly basis, the best of those suggestions are taken to customers along with the supporting data.

"Going back to what we discussed earlier - it enables every single Kyndryl team member who sees that data, to raise their hand and say, 'Hey, I think we can make things better.' It's a very, very powerful way of empowering people."