Problem Solutions Scenerio

Running head: PROBLEM SOLUTION: _________ CORPORATION

Problem Solution: _______ Corporation

John D. Schaefer

University of Phoenix

Problem Solution: _____ Corporation

Today's managers are faced with a growing list of difficult challenges that occur on a daily basis. With these challenges comes the need to be able to make critical decisions in order to succeed in adding value to all their stakeholders. The successful leaders needs to "have the ability to identify opportunities and issues, define challenges in terms of the right problem, select among a set of alternative solutions, and implement the solution to ensure it contributes value to all of the stakeholders." (Scenario Two--Global Communications, p.1) The scenario of Global Communications was presented for the application of the knowledge and skills learned in order to select a course of action necessary to achieve a desirable outcome.

Situation Background (Step 1)

Global Communications is in the telecommunications industry where there is a remarkable amount of economic pressure. Stock is currently trading for 50% less than just 3 years ago and understandably, stockholders are concerned and have been applying a tremendous amount of pressure on these telecommunications companies. In the white paper Scenario: Global communications the author notes:

Global Communications senior leadership team has developed a two-pronged aggressive approach. First, they plan to realize growth through the introduction of new services, primarily to its small business and consumer customers, who will now be served in both local and long-distance markets across the country. Second, the senior team has identified cost-cutting measures that will improve profitability. To maximize both of these initiatives, the company plans to market itself more aggressively on an international level with the goal of becoming a truly global resource. (p.1)

Competition is fierce with local and long-distance companies because they are competing for the same business. Cable companies, especially, have entered the market offering complete telephone, computer, and cable packages. To this end, a thorough understanding of the challenges and opportunities faced by Global Communications are considered.

Issue Identification

There are a number of issues that need to be taken into consideration based on the current situation at Global Communications. First, competitive pressures has caused market share to decline because local, long-distance and international companies are all competing for the same business. Second, stockholder returns have been diminished by over 50% compared to 3 years ago. Third, downsizing domestic call centers will negatively impact call center representatives forcing the employees to take a 10% pay cut with the possibility of having to relocate. Fourth, pending layoffs will cause morale issues and impact productivity causing the employees to be less loyal to the company and decrease job satisfaction.

"Annette Verschuren, president of The Home Depot Canada, pays a lot of attention to job satisfaction. 'I can tell you within two seconds of entering a store whether morale is good,' says Verschuren. The main reason for her interest is that job satisfaction is a key driver to corporate success. 'With an unhappy workforce you have nothing and you will never be great,' Verschuren warns." (McShane & Glinow, 2004)

Fifth, competitors will attempt to recruit the "best" employees causing the company to lose some of their high performers. Lastly, the union considers outsourcing as unethical causing potential legal issues for Global Communications.

Opportunity Identification

There are a number of opportunities that Global Communications need to focus on in order to become a more viable company. First, the prospect of growth in markets across the country will positively affect the bottom line of the company and enhance customer satisfaction. Second, alliances with wireless providers to compete with cable and local companies will allow Global Communications to offer better services to their customers. Third, reducing costs by 40% by outsourcing their call centers to India and Ireland will reduce unit costs for handling calls. Fourth, employees will be given a 15% retention bonus to ensure that the competition does not take away key employees from the company. Lastly, the growth opportunities, over time, will lead to higher salaries and more career opportunities over the next 3 years.

Stakeholder Perspectives/Ethical Dilemmas

Shareholders in Global Communications have the right to reasonable returns on their investments with the confidence that the industry that they have invested in is healthy and viable. This brings up the first ethical dilemma that GC faces: Should the key stakeholders be involved in the decision on how to increase profits? One way to build organizational commitment is to foster employee involvement.

"Employees feel that they are part of the organization when they make decisions that guide the organizations future. Through participation, employees begin to see how the organization is a reflection of their decisions. In this way, involvement strengthens the company as part of the employee's social identity. Employee involvement also builds loyalty because giving this power is a demonstration of the company's trust in its employees." (McShane & Glinow, 2004)

Global Communications intention is to outsource its technical call centers to India and Ireland which brings to light yet another ethical dilemma. By outsourcing employees will be laid off while others will lose 10% of their pay and have to relocate. Can outsourcing ever be the right decision to make?

"It's critical for management and the board of directors to take an objective, comprehensive view of all the risks associated with any outsourcing decision. Merely focusing on potential cost savings without looking at the new risks associated with the outsourcing decision may result in a naive denial of significant risks threatening the company's survivability. Some of those risks can be significant alone, while others may not be significant individually but can be catastrophic when they interact with other risks." (Beasley, 2004)

One stakeholder that is a key part of Global Communication is the union, who has