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Generic Benchmarking Sheet

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Autor:  anton  15 March 2011
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Global Communications Benchmarking

Heather LaHaye

Kathy Leary

Carolina Manzano

Rhodora Palad

University of Phoenix

Dr. Kamal L. Ranasinghe Ph.D., D.B.A.

MBA 500

August 28, 2006

Generic Benchmarking Worksheet

Task A: Problem/Opportunity Statement

Instructions for Task A: In the Response row, write out the problem/opportunity statements for the scenario for each of the team members.

Response to Task A:

1. Citing contract manipulation, the Union is against Global Communications strategy to become a global corporation by using an outsourcing approach and intends to take action through the government or any other available resource.

2. With the relocation of Global Communications domestic call centers, there are plans of employee layoffs, relocation, and/or salary cuts. The senior management team will need to minimize the impact of low employee morale.

3. Communication with staff in India and Ireland will be a challenge for Global Communications due to the difference in workplace cultures and legalities. The connection between corporate culture, employee engagement, worker satisfaction, and employer brand will be an area of opportunity.

4. While the Global Communications senior leadership team has decided to move to India and Ireland to create a greater global presence, the leaders need to consider the less desirable effects of going global. According to Pamela Babcock (2004), “Those include the loss of knowledge that goes with the displaced workers, impediments to sharing information and knowledge among employees offshore and, in the United States, the possible demoralizing effect on your remaining workforce as well as the risk of creating a negative corporate brand image.”

Generic Benchmarking—The purpose of generic benchmarking is to identify potential solutions to the problem statements defined in Task A. You will do this by looking at how companies in other industries have dealt with similar issues.

Task B1: Generic Benchmarking: Topics

Instructions for Task B1: In the Response row, identify the topics for which you need information in order to identify potential solutions to the problems identified in Task A.

• In the Response row, list three to five topics that you will research in peer-reviewed journals, on Web sites, and in popular publications such as magazines and newspapers.

• In the Response row, provide a justification for each topic.

Response to Task B1:

1. Outsourcing - According to Poria (2003), before outsourcing is put into effect the leaders must first understand the company’s overall strategies and the potential impact this decision can have on the company as a whole in terms of morale, effectiveness, financial options, and long term and short term goals across departments. Global Communications did not have any planned strategies on how to handle the move of hundred of jobs overseas. Open communication is lacking between the stakeholders of Global Communications and not all stakeholders were involved in the decision-making process. With the lack of communication and stakeholder involvement there is a great resistance for the planned outsourcing and the opposition of union workers to do any further negotiation. To deal with the resistance faced all stakeholders of Global Communications will need to be informed of the need to change as the organization moves towards globalization due to the competitive telecommunications industry.

2. Globalization – According to Babcock (2004), “globalization is threatening the future of white-collar jobs, which are increasingly being exported to India and other parts of the globe where highly trained, highly educated workers can perform the same jobs as U.S. workers at nearly half the cost.”

3. Layoffs – According to Ruth Morss (2006), “senior executives must establish a documented, justifiable business reason for the layoff and analyze its effect on various protected classes, defined most commonly by age, gender, race, and national origin.” If Global Communications fails to prove that the downsizing of its domestic call centers are truly valid and not an excuse to discriminate or eliminate a division only to revamp it again with a new name and/or new people, the company could face lawsuits. According to Morss (2006), “The laws apply to companies with 15 or more employees, and local laws cover companies with smaller numbers.”

Task B2: Generic Benchmarking: Companies

Instructions for Task B2: In the Response row, identify companies that have faced and addressed similar situations (successfully and unsuccessfully).

• In the Response row, list two to three companies for each topic identified in Task B1.

• In the Response row, identify those that have been successful and those that have been unsuccessful.

• In the Response row, summarize your key findings for each company as they relate to the scenario.

Response to Task B2:

Outsourcing

• Northwest Airlines is outsourcing flight attendant positions on international flights and flights with less than 100 seats to non-union flight attendants. (Northwest Layoffs)

• Boeing Company has outsourced all of its IT needs. Boeing has saved more than expected by outsourcing. (McDougall)

• ABN Amro, a Dutch bank, decided in 2004 to improve efficiency and product quality by merging the investment, retail, private banking, and asset management business under one technology platform, to be developed offshore, the senior executives’ feared resistance. "When you first approach outsourcing, it's a religious issue," says Lars Gustavsson, ABN Amro's London-based group chief information officer. "People either believe in it or they don't."

To solve the issue of opposition, a new department was created with a dedicated responsibility of just communicating the reason for the move to middle managers and staff. Town Hall meetings were held between the Senior executives and employees and involved the unions in managing shift. All the chief technology officers were involve in making decisions of redeploying the workforce and which outsourcing collaborates to select. ABN Amro offered severance package and retraining and still expects to save more than $300 million annually starting in 2007.

Global Communications Senior Leaders should renegotiate with the union workers and offer severance package and retraining to ease the burden of resistance from the workforce who will be losing their job.

• IBM is another organization that chooses outsourcing as a strategy to reduce costs. In India workers are paid $ 20 per hour for what would cost $ 100 in the United States. (Hoffstein, A. 2004) IBM CEO Sam Palmisano put a positive spin on outsourcing when he stated, "IBM is a company with strong ties across the glove, and IBM must look at global skills around the world. Most people recognize that you can not lock down jobs in the USA, business and skills, and there can be no emotional attachment to things that do not represent your future."

Randal MacDonald, Senior Vice President of Human Relations says that "IBM acts on the behalf of its employees to not only retain talent but to retain those employees who may face layoff due to the poor economy." (Hoffstein, A. 2004)

Global Communications portrays a similar mixed message to staff and stakeholders. The senior leadership will need to be sure to communicate the importance of the strategic initiative to compete within the telecommunications industry by encouraging innovation and global growth opportunities. If Global Communications can gain employee and union support a win-win opportunity exists. Providing a career path and training opportunity for employees affected by the cut backs may assist in employee morale.

• The Dutch-American publishing and software giant Wolters Kluwer started outsourcing to India years ago, there was a lot of fear caused by uncertainty. To ease the anxiety the company began a worker-education program. Christopher Catwright, CEO of Wolters Kluwer, stated, “We got ahead of them and explained that is all about enhancing capacity. We need to go from 100 IT staff to 200 to take new products but can’t afford them in U.S.”. Wolter Kluwers convinced all the valued US employees that outsourcing is ultimately good for the employees and their company. As a result, the engineers in US spend more time on innovation.

Global Communications needs to look at utilizing the remaining workforce by providing them with a training program to increase innovative thinking for new products and services. Senior leadership will need to provide strategic initiatives to increase engage employees and improve morale.

Globalization

• Globalization is not always favorable for an organization. For example, Paper Converting Machine Co. (PCMC) a factory making “complex equipment to weave, fold, and print packaging for everything from potato chips to baby wipes.” (Arndt, et. al. 2006)

Two years ago, one of PCMC’s largest accounts demanded that machinery prices be reduced by 40% and urged production be moved to China. To make matters worse, Barry-Wehmiller Cos., a St. Louis holding company, last year purchased PCMC and immediately cut both union workers and nonunion pay. “In five years sales have plunged by 40%, to $170 million, and the workforce has shrunk from 2,000 to 1,100.” (Arndt, et.al 2006)

Global Communications does not necessarily need to become a truly global resource. Senior leadership needs to review all globalization alternatives. An opportunity for shared knowledge between countries exists if Global Communications maintains an operational domestic call center in the United States and relocates top talent to assist in the recruitment strategies of the top talent in both India and Ireland.

Layoffs

• Northwest Airlines is having a major cutback with its employees due to the airplane crisis after 911. 400 pilots and 1400 flight attendants have been cut and that may not be all. (Northwest Layoffs)

• Boeing Company is having a major layoff due to lack of production. Boeing will distribute 60 days notices on August 8, 2006 for October layoffs. (Boeing Co. to Layoff)

• Northwest Airlines is not concerned with the moral of the current employees. They are making decisions based on what is best for the company. The employees that have received termination notices also received a pamphlet on how to save money when you are not working. Many of the employees were quite offended with the information that was provided. (Grow)

• Northwest Airlines and Boeing Company have succeeded with the layoffs and outsourcing portion of their business. Neither company succeeded in keeping the employees with a good taste in their mouths for the company that they gave there all. Both organizations are viewed poorly in this area.

Many organizations like Boeing and Northwest Airlines are making the global transition to compete within their industry. Global Communications goal is not so different. To make this global transition, their needs to be layoffs and reduction in salaries for the employees in the United States. The leaders of Global Communications will need to look to change management initiatives to balance the organizational values with the effects on the workforce in the United States, India, and Ireland.

Task B3: Generic Benchmarking: References

Instructions for Task B3: In the Response column, list each reference using APA format.

Response to Task B3:

Arndt, M., Engardio, P. and Foust, D. (2006). The Future of Outsourcing. Business Week Online. Retrieved August 28, 2006 from: http://www.businessweek.com/magazine/content/06_05/b3969401.htm

Babcock, P. (2004). America’s Newest Export: White-Collar Jobs. HR Magazine, April 2004. Retrieved August 27, 2006 from: http://www.shrm.org/hrmagazine/articles/0404/0404covstory.asp

Boeing to Layoff 77 St. Louis Union Workers. (August 10, 2006). St. Louis Business

Journal. Retrieved August 26, 2006, from

http://stlouis.bizjournals.com/stlouis/stories/2006/08/07/daily48.html?surround=lfn

Engardio, Pete. Online Extra. Worldly Lessons for Wolters Kluwer. (January 30, 2006). Businessweek.com Retrieved August 23, 2006.

http://www.businessweek.com/magazine/content/06_05/b3969415.htm.

Grow, Doug. Layoff targets get thrifty hints from Northwest. (August 18, 2006).

Startribune.com. Retrieved August 26, 2006.

http://www.startribune.com/465/story/621368.html

Hoffstein, A. (2004). IBM Outsourcing Jobs to India. Retrieved August 28, 2006 from: http://www.thinkandask.com/news/ibmoutsourcing.html

Kripalani, Mangeet. Five Offshore Practices that Pay Off.

Business Week Online. Retrieved Aug. 23, 2006.

http://images.businessweek.com/ss/06/01/outsourcing/index_01.htm

Morss, R. (2006). Surviving Layoffs and Downsizing. Retrieved from Salary.com on August 27, 2006. http://www.salary.com/careers/layouthtmls/crel_display_nocat_Ser17_Par47.html

Newman, Paul. Majority of Boeing Layoffs to hit by June. (November 2, 2001).

Retrieved August 26, 2006.

http://seattlepi.nwsource.com/business/45132_boeing02.shtml.

Northwest Layoffs and Outsourcing Continue. (September 23, 2005). Workers

Independent News. Retrieved August 26, 2006.

http://www.laborradio.org/node/1529.

Poria, Bharat. Strategic Outsourcing. (June 16, 2003). CIO White Papers. Retrieved August 23, 2006. http://searchcio.techtarget.com/whitepaperPage/0,293857,sid19_gci924451,00.html

The Boeing Company – Executive Layoff Benefit Plan. (April 1, 2001). Finc Law

for Corporate Council, 3. Retrieved August 26, 2006, from

http://contracts.corporate.findlaw.com/agreements/boeing/execlayoff.html.



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