Case Study: Telstra

Published: 2018-02-01 10:39:00
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Introduction

Telstra Company is an Australian media service and telecommunication corporation worth $ 25 billion. The company is ranked eleventh largest Telco globally when its market capitalization in analyzed. The company provides services such broadband, mobile internet services, mobile telephony, digital televisions, data services, and also offers fixed lines. The basis for the organizations' media services includes yellow page books, online directory, and cable TV. In Australia, the company's head office is located in Level 41, 242 Exhibition Street Melbourne Victoria 3000. Other offices and stores in the country include the Adelaide office, level 1, 30 Pirie St, the Brisbane level 20, 275 George Street, Sydney 360 Oxford St Paddington, Lansdale, Gnangara Rd, and the Oxford Falls Rd office. Globally, Telstra has branches in many countries in Europe and the United States (Lui, 2009). The paper investigates a case study of Telstra Company's cultural transformation and it impacts on the management, leadership, and policy change.

Company's Description before Change

 Culture audit on the company showed that the hierarchical culture initially had a diminutive understanding of the stakeholder group's real needs. The above reflected on the urgency for the company to make changes. After the changes that included training of the workers, Telstra experienced improvements in all levels of the F&A structure recording gains from the stopping of non-value activities (Whitewood, 2014). For example, the provision of 250 reports was found to have little value for the projected user and thus had to be stopped. The company also recorded increased accuracy and delivery speed of private letters due to a better understanding of needs and collection processes (Lui, 2009).

Management Structure

The company is led by a Chief Executive Officer, Andrew Penn followed by the Chairman of the Board, John Mullen. Under the two, eight directors are members of the Board. Each department is led by a senior manager while each team or group has a leader responsible for directing and evaluating the performance of team members (Lui, 2009). The company's 2015 analysis showed that it has a total of 36, 165 employees in total. The organizational behavior models illustrates that well structured management leadership are fundamental to employee motivation and success of the business (Jones, 2010).

Employee Motivation and Performance

According to the Head of Performance and Global talent in the company, Troy Hoggan, Telstra has adopted several measures that are aimed at rewarding employees for better performance. The corporation has focused on the Four Drive Theory to motivate its employees, for instance, through the use of incentives. In 2014, the company introduced a novel strategy for performance appraisal of workers that focused more on to acquire and achieve. The approach is centered on the core objectives and values of the corporation so as to give the workers more control and choice on the way to set and achieve individual goals (Walters, 2012). The firm introduced on a key strategy called "Our Deal" which describes a personal contract between a worker and their team leader meant for deciding the system, frequency, and center of future performance conversations (Walters, 2012). The approach is also recognized for introducing learning and performance platforms such as success plan that provides a link between progress, development, and priorities. Also, the strategy presents a clear assessment for individual rating by the overall performance. The performance approach further increases the focus towards creating a culture of personal accountability and leadership. Since the introduction of the motivation strategy, employee's feedbacks have indicated they understand more on what s expected of them, and the directions are now clearer (Walters, 2012).

 Telstra Company has introduced several strategies for motivating workers and boosting the overall performance of the company.  The Herzberg’s Two-Factor Theory of Motivation has been used by the firm through pay increment and job promotions for those workers performing well. For instance, some of the rewards for those employees performing include staff discounts on the firm's services and products, health benefits, a guaranteed above ten business super support, and financial perks (DeShields et al, 2005). The company also improves the lifestyles of employees recording high performances through giving them gifts such as new cars, fully paid for holidays, exotic adventures, dining experiences, magazine subscriptions, and additional annual leaves, etc. Moreover, the firm also presents the employees with career growth opportunities to achieve personal goals (Gans & King, 2003). The workers get a chance to choose from variety career directions which help them in defining individual professional paths with the support of their leaders. Additionally, the firm has employed the Four Drive Model through hugely emphasizing on team building that create the sense of “bond and belong” improving productivity (Nohria et al, 2008).

Change Management Strategies

 Telstra has undergone a variety of changes over the past years to becoming a more customer-focused corporation. Organizational behavior also deals with cultural change and seen at Telstra such behaviors are important in the improvement of the company’s yield (Jones, 2010). For instance, company adopted a cultural change approach in 2008 that was referred to as value service culture (VSC) that was initiated to alter the view that Telstra had poor customer services. The process involved four steps namely planning for achievement, culture transformation, embedded culture, and continuous scrutinizing and recovery (Stanhope, 2010).

Planning For Success Phase

  This phase included assessment and changing roadmap of culture. Any plans for cultural change is determinant on a culture audit so that the firm can first gain detailed insight, fabricate interactions, and reduce resistance risk of talent growth and culture change. Identification of leaders who can champion for change is also imperative since such leadership skills that enhance implementation and assessment plans. The planning phase also presents a time for the management to refine goals and visions of the company. For Telstra, the initial step was the chief financial officer (CFO) to communicate the vision of the corporation and instill a sense of urgency for the changes in the company. The following step involved undertaking a culture audit through conducting interviews on all F & A Group and in all main business lines (Stanhope, 2010). A cultural shift plan was initiated commencing with the launching of the goals and visions.  

Culture Transformation Phase

  The transformation process demands communication and initiation of activities that demonstrates the working of the new culture being adopted. The process also requires a strong guiding alliance of leaders to harmonize and direct on the changed behaviors. Cultural transformation at times requires new skills and methods for sharing experiences and learning. Telstra formed a guiding coalition for most of the senior leadership groups to guide the culture change and present regular reports to the executives including the CFO, marketing communication heads, and executive HR (Peel, 2007). The team managed to concentrate on the VSC programs emphasizing more on communications. Team's heads of the lines of business also held meetings to talk about the initiatives and lay down roles for the identification of the company's internal customers. The leaders further designed a two-day workshop that covered the value service culture mindset and understanding of how employees could identify the needs of clients and also monitoring of satisfaction. With the first set of the workshop covering 200 individuals, the CFO was able to reinforce the department's commitment towards the culture change (Stanhope, 2010). 

Setting in the Novel Culture Phase

 It is during this stage that orientation and performance evaluation processes are designed, and they include the desired cultural conducts and the company's targets for supporting the embedded systems. This step hugely applies the organizational behavior model in job valuation and appraisal which determines the workers to be rewarded and those to be punished (Jones, 2010). In this phase, Telstra's focus shifted from short-term outcomes to performance assessment and rewarding. The human resource team linked with the line business management so as to incorporate the VSC conduct descriptions and evaluate satisfaction targets for the customers. In 2010, several groups were involved in creating an innovative and more open environment such as coaching and training (Stanhope, 2010).

Monitoring of Performance Phase

Organizational behavior theories such as the Herzberg’s Two-Factor Model monitor the performance of workers for appraisal (DeShields et al, 2005). The performance of any company should be measured by cultural behaviors and customer satisfaction. In this phase, the CFO sanctioned the advancement of novel approaches that would improve customer satisfaction (Stanhope, 2010). The group commissioned by the CFO developed the Customer Value Analysis (CVA) approach that would support serving of internal clients (Goggin, & Newell, 2000). The above led to improvements in customer perceptions of the quality of products and services. The four phase discussed above illustrates the use of organizational theory in solving problems and maximizing the efficiency and productivity of employees (Jones, 2010).

Conclusion

 In summary, Telstra Company, Australia underwent many changes regarding its management, leadership, and policy so as to reach such levels of growth. The firm ranks among the top globally in market capitalization which has promoted its expansion in many countries. The Corporation has utilized various aspects of the organizational theory such as performance appraisal, employing training practices to add skills, and promotion of career development in its bid to boost the overall productivity of the company. Additionally, it is imperative to note that the cultural change that Telstra had undertaken have been influential in promoting customer services and increasing productivity. Such cultural changes are paramount when a business is experiencing downsizing growth which may result in the failure of the company.

References

DeShields Jr, O. W., Kara, A., & Kaynak, E. (2005). Determinants of business 

student satisfaction and retention in higher education: applying Herzberg's two-factor theory. International journal of educational management, 19(2), 128-139.

Gans, J. S., & King, S. P. (2003). Investigating the benefits and costs of the structural separation of Telstra. Submission to House of Representatives Inquiry into the Structure of Telstra, 31.

Goggin, G., & Newell, C. J. (2000). Telstra and consumers: The TCCC and the future. Telecommunications Journal of Australia, 50(3), 19-22.

Jones, G. R. (2010). Organizational theory, design, and change. Upper Saddle River: Pearson.

Lui, S. (2009). Telstra reveals new company structure. ARN. Retrieved From: http://www.arnnet.com.au/article/328016/telstra_reveals_new_company_structure/

Nohria, N., Groysberg, B., & Lee, L. E. (2008). Employee motivation. harvard business review, 86(7/8), 78-84.

Peel, J. (2007). When (Scientific) Rationality Rules:(Mis) Application of the Precautionary Principle in Australian Mobile Phone Tower Cases Telstra Corporation Limited v Hornsby Shire Council. Journal of Environmental Law, 19(1), 103-120.

Stanhope, J. (2010). TELSTRA CASE STUDY The CFO leads cultural transformation and acts as a guiding light for the whole organization. Market Structure.

Walters, K. (2012). Telstra’s performance-pay plan: Could it work for you?. Smart Company. Retrieved from http://www.smartcompany.com.au/people-human-resources/leadership/27974-telstra-s-performance-pay-plan-could-it-work-for-you/

Whitewood, M. (2014). Org Chart -Telstra June 18th. Creately. Retrieved from  https://creately.com/diagram/example/i8s6om81/Org%20Chart%20-Telstra%20June%2018th

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