Table of Contents
Executive Summary p. 2
Prescription for Change
A. Vision for Renewed Organization p. 3
B. Direction for Scope and Change p. 4
C. Speed of Change p. 5
Proposed Actions p. 7
Executive Summary
From the previous assignment, it can be understood that despite the active participation of PCCW in the industry of Hong Kong, it still encounters several problems and issues that makes its business somehow lead into failure. The problems or issues discussed in the previous assignment include the following:
First problem encountered by the company is the change in ownership or management of the company, as resigned as the company’s Chief Executive Officer, and even agreed to sell his indirectly held 22.66% stake in the company (2006). This problem is the result of another problem of the company, which is the piling up of its debt, which led it to sell its stocks and the whole company to other telecommunications company. Increase in the competition among the industry also became the problem of the company, for with the increase in competition sales and profit will be decreased, thus, becoming a threat to the success of the company in the market. Increase in competition gave way to monopolies, which further reduced the profit of the company. As a response of the company to such problems, they opted to reduce their workforce for cost reduction in the company, due to the slowing down of operations. All of these problems were consequences of Hong Kong’s failure to bid with China, for at the time, China does not want to be associated with a company that is connected to the Singapore government. In addition to this problem, the overall issue encountered by Hong Kong companies, such as PCCW, is the slow development of the infrastructure in East Asia that contributed to the decline of the businesses in different parts of Asia, including Hong Kong.
These problems led to the decline of the performance of PCCW, which became an issue in Hong Kong. With this, several implementation or action plans will be proposed, as solutions to the problems and issues encountered. These would include the vision for the renewed organization, the direction and scope of change, and the speed of change.
Prescription for Change – “A Giant Leap for a Strong Come Back”
A. Vision for Renewed Organization
In line with the changes needed by the company, its vision must also change as an answer to its renewed short-term and long-term goals or objectives. Because of this, a new mission statement must also be proposed.
New Mission Statement: PCCW-HKT is an empowered business organization that provides high quality, practical, and innovative technological and communication solutions with its aim for customer satisfaction and brand loyalty. It serves to be the leader in the technological and communication industry, through being a good example for other companies, through putting first the welfare and well-being of the company’s workforce before anything else. The company will also focus on implementing new business and management strategies that would enhance the skills and potentials of the employees. The company will also be creating its identity, which would represent its services and solutions, to contribute to its overall image, as the leading provider of telecommunications and innovative technology in Hong Kong and in other parts of the world.
B. Direction and Scope of Change
The direction and scope of change of the company must involve several steps that would serve as possible solutions to the problems encountered by the company. These directions and scope are as follows:
- Coming up with new projects and strategies as an answer to the delay in development of infrastructures in East Asia
- Collaborating with and making agreements and treaties with China to agree with the bid
- Finding additional revenues to be able to repay debt, such as fund raising activities, solicitations, and sponsorships
- Adopting a Matrix form of Organizational Design
- Reducing costs through finding new suppliers and cheaper alternative materials
- Reduce laying off of workforce through compensations and increase in motivation through job redesign, job enlargement, and job rotation
- Joining monopolies to increase profits and lessen competition
- Enhancing the company’s operations management through implementation of Total Quality Management
- Adopting and implementing new leadership styles
- Improvement and development of cultural web in the company and among employees
- Adopting new information system and other communication programs
- Maximization of e-commerce and the use of the Internet for transactions and negotiations
- Retaining customers through value added customer service
C. Speed of Change
The direction and scope in relation to the changes of the company must be implemented effectively and efficiently to guarantee the successful come back of PCCW in the market and industry of Hong Kong. However, to maximize and effectively utilize the effects of the scope and direction of these changes, a time frame or period must be set.
- Speed of Change: This must be done in two to three months time after auditing the total revenues and sales of the company.
- Speed of Change: This must be done and implemented in two to three months time after coming up with new strategies, so as not to further reduce the company’s resources in Hong Kong.
- Speed of Change: This must be done simultaneously with attaining agreements with China, to compensate with the loss of resources of the company.
- Speed of Change: This must be accomplished in one or two months time after the selling of the company and after the assigning of its new Chief Executive Officer.
- Speed of Change: This must be done simultaneously with finding additional revenues to reduce costs and not spend the company’s existing resources.
- Speed of Change: This must be implemented soon after the assigning of the new Chief Executive Officer, except for reasons that would present threats to the company.
- Speed of Change: If agreements with China are not successful
- Speed of Change: This must be done one to three months after assigning of the company’s new CEO
- Speed of Change: This must be done three to four months after assigning of the company’s new CEO, to evaluate and assess the performance of the employees under new management
- Speed of Change: This must be accomplished all throughout the employees’ stay in the company
- Speed of Change: This must be adopted and implemented six to eight months of assigning the new CEO
- Speed of Change: This must be accomplished after adopting new IT systems
Speed of Change: This must be accomplished all throughout the course of the company’s business.
Proposed Actions
One of the problems identified was the lack of overall development of infrastructures in East Asia, and this contributes the company’s becoming stagnant in terms of its development. With this problem, the company should not wait for the development of whole East Asia for it to be able to develop as a company, for the development of East Asia depends on a myriad of factors that interrelate in the economy, politics, and society of different countries under it. With this, PCCW must therefore try to find new materials that would suit the infrastructures in Hong Kong and other parts of East Asia. The company must therefore invest and allocate time and effort on its Research and Development in its quest to find new supplies and materials.
In relation to the performance of the workforce, performance management can be implemented, which is an important process for influencing both the extrinsic and intrinsic motivations of employees, that is, increasing employees’ perceptions and understanding of job tasks and subsequently their job satisfaction. PCCW can focus on much more effective performance appraisal activities that would enable job analysis of employees, thus, placing them on the right positions in the company. This would serve to assist employees in reducing job errors and minimizing the risks of learning through trial and error. This, in turn, is based on the belief that an effectively designed, implemented, and administered organization can provide its members with a myriad of benefits ( 1987). In addition, the literature on performance management generally suggests that the management process can increase employee motivation and productivity, provide a solid basis for wage and salary administration, facilitate discussions concerning employee growth and development, provide data for human resource decisions, and provide managers with a useful communication tool for employee goal setting and performance planning (1989). In this regard, such can be achieved through implementation of job rotation, job redesign, and job enrichment that would enable the employees to empower themselves not only with regards to their performance in the company, but with how they perceive themselves as well.
Reduction of costs of the company can be achieved through outsourcing units or departments, such as its customer relationship management system and its call center. In addition to outsourcing, the company can also reduce costs by switching stations, such that changing their usage would enhance the use of the stations and reduce their maintenance costs (2007). Another solution for the problems of the company is to increase its revenues, which can be done in two ways. First, the company can increase its prices, which would be difficult, as it has to seek first the approval of the current OFTA policy; so the second strategy is more applicable, which is to add new services, such as adapting the VoIP over broadband internet. This is becoming the trend in Hong Kong, thus, its implementation, along with adding some value added services that Hong Kong Broadband Network lacks, is the best source of additional revenue (2007). In addition to this, the company can also promote new services, packages and promos to attract more users.
Moreover, improvement of the operations strategy of the company can be implemented to ensure its success and efficiency in the market. Improving the company’s operations strategy involves supply chain management, which is the coordination of the different relationships existing across the supply chain, and involves both intra-business and inter-business relationships (1997). In managing the different aspects of the supply chain, the nature of the process links between the different components differ because of the different characteristics and requirements in developing a relationship between these processes. This is because the movers of integration are contextual differing across the different process links. The integration of the process of procurement and warehouse inventory differs from the integration of transportation and warehouse retrieval. The difference is explained by the fact that there is process links considered as more critical than other links. Because of this, the allocation of resources in the different process links also differs. (1995).
Another proposed solution is the implementation of Total Quality Management of TQM, which is an approach to improving the effectiveness and flexibility of businesses as a whole. It is essentially a way of organizing and involving the whole organization; every department, every activity, every single person at every level (2002). It is a combination of quality and management tools aimed at increasing business and reducing losses due to wasteful practices, and a method by which management and employees can become involved in the continuous improvement of the production of goods and services ( 2006). (1995) reports, that through the application of total quality management in a company, the senior management will empower all levels of management, including self-management of the employees to manage quality system. These benefits are grouped into five key areas, namely, continuous improvement, multifunctional teams, reduction in variation, supplier integration, and education and training (1995).
In relation to meeting the increasing demands of consumers, customer value and relationship marketing must be implemented. Customers set up a hierarchy of values, wants and needs based on empirical data, opinions, word-of-mouth references, and previous experiences with products and services, and use this information to make purchasing decisions (1991). Today, the importance of market positioning depends on not only the products, services, and needs of the customers, but on the company’s competitive strategy, pricing, packaging, distribution, service, support and communications, such as the use of advanced technologies. Customer value then must be given additional importance of the company, most especially their stockholders. A good venue for developing perceived value is through the Internet, representing a state of pure competition, where there exist many buyers and sellers and a lot of market information on which to base decisions in purchasing or patronizing a product or service (2004). This, in turn, enhances the relationship marketing of the company, which emphasizes on building longer term relationships with customers, understanding their needs, and in providing a range of products and services to existing customers as they need them (2007). In addition, the company can lower their prices, implement and promote loyalty programs, provide value-added services, and employ analytic customer relationship management (2007). This can be done through implementation of Information and Communication Systems in the company that would not only enhance its innovative capacities, but would also provide convenience and support on the part of the employees and its management.
Furthermore, the changes can be further enhanced through the development of the culture of the employees in the company, such that improving also their intercultural communication and competence. Intercultural competence can be defined as the ability to develop and maintain relationships, the ability to communicate effectively and appropriately with minimal loss or distortion, and the ability to attain compliance and obtain cooperation with individuals from other cultures (2000). Cultural and intercultural communication and competence can be developed with the implementation of effective and efficient leadership and management styles. (2000) emphasizes six leadership styles that can be adopted by a team leader or manager to effectively manage his or her team, namely, Authoritative or Charismatic leadership, Affiliative leadership, Democratic leadership, Coaching leadership, Pacesetting leadership, and Coercive leadership. One or several of these styles can be adopted to ensure the control of the employees, and the unity in the workplace. Moreover, with effective leadership, the company will be able to manage diversity and conflict in the workplace, which are means to successful operations and effective public service ( 2003).
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