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Global Communications

Autor:   •  November 27, 2011  •  Case Study  •  1,874 Words (8 Pages)  •  706 Views

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Global Communications

Global Communications is a company in the telecommunication industry. Over the years this industry has become extremely competitive. With local and long-distance markets competing for the same business, it has become extremely tough for Global Communications to stay ahead. The Stockholders are starting to grumble about the decrease in profits and are concerned about the industry possessing the staying power to turn around. The management of Global Communications must come up with a solution to this problem quick fast. Many lives hang in the balance, but Global Communications believes that their strategy will make this company the leader in the telecommunications industry. With every new approach comes along problems that even Global Communications have to overcome, to succeed. Some of these problems include salary cuts, loss of employment, and reduction in education, health benefits, and loss of respect, integrity, and loyalty. Global Communications is in a tight position between making the stockholders happy and upholding the history of the company, which is treating the employees well that they believed, gave them a competitive edge.

Situation Analysis

Issue and Opportunity Identification

To tackle this problem with competition, Global Communications decided to take an aggressive approach. They decided to take cost cutting measures that would improve profitability. The plan was to market the company on an international level with the ultimate goal of becoming a global resource. This approach meant jobs would be outsourced to India and Ireland. In addition, those relocating will be expected to take a 10 percent salary cut, because the consumer centers would be able to operate on a leaner budget than the current small business centers. This showed in the Global Communications business case that, setting up new centers would reduce costs for handling calls by 40 percent. Global Communications goals were to increase growth and profits; because of this, the Board approved this strategy. This strategy would help further that goal but the issue is Global Communications did not consider the concerns of the Union, nor did they hold to their long history of treating employees well. The Union was relying on this piece of history to obtain the best contract for the employees. The Union already gave up 20 percent of its education and health benefits as a way to cut costs for Global Communications, they are also faced with the possibility of job outsourcing on top of the sacrifice they made. The approach taken by Global Communications creates a win-lose situation that could lead to conflict as compared to the win-win situation created by integrative negotiations, (Kinicki & Kreitner, 2003, p. 504). The concept Global Communications created is called distributive negotiations. "A distributive

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