Mba 500 Global Communications

Running head: PROBLEM SOLUTION: GLOBAL COMMUNICATIONS

Problem Solution: Global Communications

Randy Gaspard

University of Phoenix

Problem Solution: Global Communications

Global Communications will increase its profitability by developing methods to increase business and residential customers, build customer retention, and reduce overall expenditures

Situation Analysis

Issue and Opportunity Identification

Three years ago today, Global Communications stocks was worth $28 per share today the same stock is worth $11 per share. The reason for the declining stock is the telecommunications market has become far too competitive. Profits are spread thin amongst the competing companies. Offering local and long distance telephone service is not enough to stay competitive. Expansion into the international market was thought to be a viable plan but that venture was not profitable. The Senior Team must seek out opportunities for Global that demonstrate the ability to rebound financially. There are numerous phone companies, including Global, that have created alliances with satellite companies. These alliances have allowed the expansion of services but have become commonplace. Cable companies have now joined alliances with domestic and international phone companies. Now cable companies can offer business owners and residential consumer’s local, long distance, cable and internet service in a one price bundled package. Cable company alliances hit the telecommunications industry hard, and Global was no exception. Global was left with no alternative but to develop a strategic plan.

The CEO of Global developed a 3-year plan that seemed to offer potential opportunities. The plan included sending both technical calls centers and domestic call centers to companies in India and Ireland. An analysis presented to the Board provided these major benefits: 1.) Alleviate 40% of the overhead cost in the call centers. 2.) Necessitate only a 10% reduction in the staff. 3.) These two benefits are foreseen as an immediate way to increase the company profits. Global would benefit in three ways: 1.) Profits will increase from the overhead reduction. 2.) The customer base could receive a reduction in price 3.) This could lure customers from the competition.

Stakeholder Perspectives/Ethical Dilemmas

The stakeholders at Global Communication are the Technologies Workers Union, the investors, the GC Expatriate Employees, the downsized Employees, the remaining American Employees, the consumers, the CEO and the management team. These stakeholders have certain interests and values which will create an insurmountable amount of conflict if not handled correctly. Below are the identified stakeholders and the potential conflict of each group.

Technologies Workers Union

The union’s interests are to ensure that the work environment and/or work practices do not infringe on the employees’ rights. The conflict is that the union does not readily accept any changes from the senior management. Unions are fighting extremely hard to remain an active voice for the working man or woman. The reason is that firms today are shifting away from the manufacturing industry, which has had a negative effect on the unions' ability to win big wage increases. Manufacturing jobs tend to have a higher output value per hour than the less-skilled service jobs replacing them; manufacturing firms thus have more leeway to raise wages. Manufacturing plants are much bigger and require more investment than service operations. This gives unions more bargaining power in two ways: the big investment makes it hard for firms to exit the labor market; and the unionization and negotiation process is easier with a few big establishments than a multitude of small ones (Global Agenda, 2007).

Another conflict is that globalization has undermined the very existence of the union. Countries like China are adding millions of new workers to the global labor force each year and all these workers are willing to work for less money than their American counterparts.

Investor

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