Xel Communications

An introduction to the case - The context of Organization

XEL Communications, Inc.--located in the outskirts of Denver, Colorado designed and manufactured various telecommunications products for a number of companies--primarily large U.S. telephone operating companies. Originally, it was a division within GTE headed by Bill Sanko, it was about to be closed when Sanko and a few others bought the loss making division from GTE and made it into a profit making organization. Its revenues increased from $16.8 million in 1992 to $23.6 million in 1993 and $52.3 million in 1994--over a threefold increase in three years. By the year 1996, XEL communications, Inc. employed approximately 300 people. The case examines several key aspects of XEL's operation: determining the appropriate product/market mix, financing growth, developing a quality-oriented culture, self-managing worker teams, and maintaining innovation. XEL is now faced with three options owing to its rapid growth. They could continue to remain privately held, they could go public or they could take a strategic partner. XEL decided to go for the third option after listening to the advice of a consultant. They finally decide on Gilbert Associates as their partner.

Organizational Effectiveness

Organizational effectiveness has been defined as the ability of an organization to fulfill its mission through sound management, strong governance and a persistent rededication to achieving results. Effective nonprofits are mission-driven, adaptable, customer-focused, entrepreneurial, outcomes-oriented and sustainable. It also relates to the capacity of an organization to sustain the people, strategies, learning, infrastructure and resources it needs to continue to achieve its mission. It is a long-term outcome. In the case of XEL communications, Inc., its mission and vision statement has been passed on to the employees in a cascade manner and every single employee was made aware of these statements and they regularly used them to make decisions.

Organizational Structure

Organizational structure is the way in which the interrelated groups of an organization are constructed. From a managerial point of view the main concerns are ensuring effective communication and coordination. The following could be the organizational structure of XEL communications, Inc.:

Structure of XEL communications, Inc.

Organizational growth

Growth is something for which most companies, large or small, strive. Most firms, of course, desire growth in order to prosper, not just to survive. Organizational growth, however, means different things to different organizations. Indeed, there are many parameters a company can select to measure its growth. The most meaningful yardstick is one that shows progress with respect to an organization's stated goals. The ultimate goal of most companies is profit, so net profit, revenue, and other financial data are often utilized as "bottom-line" indications of growth. Other business owners, meanwhile, may use sales figures, number of employees, physical expansion, or other criteria to judge organizational growth. In the case of XEL communications, Inc., this company has achieved tremendous organizational growth. Its revenues increased from $16.8 million in 1992 to $23.6 million in 1993 and $52.3 million in 1994--over a threefold increase in three years. By the year 1996, XEL communications, Inc. employed approximately 300 people. So clearly we can say that XEL communications, Inc. is growing rapidly.

Organizational Culture

Basically, organizational culture is the personality of the organization. Culture is comprised of the assumptions, values, norms and tangible signs (artifacts) of organization members and their behaviors. Members of an organization soon come to sense the particular culture of an organization. The concept of culture is particularly important when attempting to manage organization-wide change. Practitioners are coming to realize that, despite the best-laid plans, organizational change must include not only changing structures and processes, but also changing the corporate culture as well. XEL communications, Inc. had a culture of innovation and team decision making. The employees did not fear risk taking and were a part of every single decision.

Managing Organizational change

Organizational change occurs when a company makes a transition from its current state to some desired future state. Managing organizational change is the process of planning and implementing change in organizations