I cannot say that I tore up a lot of paper while writing this because I'm using a computer, but I have had to use the delete function many times. The words just wouldn’t come out. Apart from being colleagues at IESE, I launched many diverse projects with Eduardo, some of which were great challenges. And even though I was almost a generation older, I learned from Eduardo the real measure of what teamwork means. I think we complemented each other well even though we were very different in terms of training, skills and previous experience: he was an economist, I an engineer; he was a professor of competitive strategy, I was a professor of finance, and I was... a little less young.
I asked myself whether, with all of these differences, we would be able to work together. But Eduardo, an optimist by nature, saw in this a great opportunity rather than a hindrance. He would say to me: “look, Josep, what we have to do is put aside idiotic pride and useless prejudice. You take care of what both you and I know you do better. And I take care of what both you and I know that I do better.” And it worked.
The first important project that we undertook was a report on the benefits of the merger between Caja de Pensiones and Caja de Ahorros de Barcelona. Time was short and we needed to maximize efficiency in our distribution of labor. We set up a small office in the basement of my house, we got help from research assistants and we divided up the management of the task. We soon agreed that the basic criterion of the decision should concern whether the merger created or destroyed value. And since it concerned savings banks with no capital of their own, we wouldn't be talking about value for shareholders but rather value for society in general.
Eduardo worked with economic models and econometrics, regression procedures, the Herfindahl index and other measures of the impact of competition between similar institutions in their basic areas, which enabled him to measure the generation or destruction of value if the merger were to go ahead.
I would have been incapable of proceeding with that approach, so my responsibility was what we called the "grunt work.” In other words, rolling up the sleeves and calculating the effects of the potential merger on central services (computer backups, elimination of duplicated job roles etc.), on offices (which would be closed, transferred or changed, etc.), on pay structures (the differences between two entities are usually rounded up and not down), and many other details. All of the potential additional savings and costs were analyzed, all in close cooperation with the corresponding CEOs from the two entities who had already advanced a great deal of the work.
In the end, almost miraculously, the two approaches, completely independent of each other, led to surprisingly similar numbers regarding the creation of value through the merger... and the merger went ahead. And I began to admire Eduardo.
Together we carried out many other projects. Among them was a series of studies regarding the competitive advantages of Catalonia, carried out for the Industry and Energy Ministry of the Catalonian autonomous government using the cluster methodology which Eduardo was an expert on and had been proposed by Harvard Prof. Michael Porter. But our collaboration plan was always the same: disregard personal glory and divide up the work in the most efficient way possible.
I’ve been retired for more than four years but I miss you, Eduardo. You were an excellent peer, a unique colleague, and above all, a great friend. May God keep you in His glory.
Josep Faus
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