FRAMINGHAM (07/21/2000) - Veteran technology executive Dick Hudson was abruptly removed from his CIO post at Global Marine Inc. earlier this month as part of an ongoing restructuring at the Houston-based company, which has eliminated 30% of its information technology department and several key executive positions since Jan. 1.
Hudson, 59, Global's CIO for the past 18 years, received a surprise request from executives that he take early retirement from the $1.1 billion oil drilling company. His last day was July 7.
"Every company continually rejuggles responsibilities and moves different people into different jobs," said Tom Johnson, senior vice president of administration and acting CIO at Global. Hudson's departure, he added, "doesn't in any way diminish the importance we put on IT."
But Johnson also acknowledged that Global is considering outsourcing IT. "Just like a lot of other companies, we're looking at [application service providers]," he said.
"It was not a cost-cutting move, and it was not at all related to Dick's administration of the department or his performance," he added.
Hudson is an occasional Computerworld columnist and a Premier 100 award winner.
IT has been under pressure at Global since well before Hudson's departure. This year, Global has cut nine jobs in the IT group, which now stands at 25 people.
Other cost-cutting moves at the company include closing a drilling operations office in the Netherlands and eliminating senior positions in the tax and personnel departments, which together should reduce overhead expenses by 10% to 15%, company insiders said.
Contacted at his home in Houston, Hudson said the restructuring "makes sense."
"If you look at it dispassionately, it makes a lot of sense. Lower costs mean higher profits. But I'd still rather not have been caught up in it," he said.
In January, Global executives told analysts about plans to reduce costs by $5 million by the end of the first quarter, said Poe Fratt, an oil service industry analyst at A. G. Edwards & Sons Inc. in St. Louis.
But Global Marine, which operates 32 offshore oil drilling rigs around the world, is "not in [financial] trouble at all," Fratt emphasized. Instead, the cost-cutting and layoffs are "more a reflection of internal restructuring and trying to do things better," he said.
Other analysts noted that Global Marine may be a good candidate for outsourcing because it uses relatively plain technologies to exchange information among its various sites.
Another theory is that Global assumed that, as oil prices rose, the big oil companies would release more funds for drilling and business would increase.
But that didn't pan out, said Greg Farris, a former IT manager at Global Marine and now vice president of IT at Oceaneering International Inc., a Houston-based manufacturer of deep-sea and outer-space exploration equipment.
"Because those expected revenues aren't coming in, most of the [drilling] companies are trimming back so they don't bleed cash," Farris said.
Hudson said he plans to launch a part-time IT consulting business specializing in mentoring technology executives - an area in which he has substantial expertise.
In his 18 years at Global, five of Hudson's No. 2 IT managers became CIOs at other firms. "In a way, I feel like Tom Landry and Mike Ditka, whose players and assistant coaches went on to become head coaches themselves," Hudson said.