Gap Analysis: Global Communications
The confidence in the entire telecommunications industry is diminishing. Stockholders are realizing diminishing returns on their investment and are having doubts about the industry?s ability to regain past levels of profitability. Telecommunications companies are experiencing losses due to high levels of competition for the consumer dollars available. Cable companies have been allowed into the market to provide a single provider solution for television, broadband internet, and two-way voice communication. The leadership of Global Communication has the challenge before them of turning the declining profits of the previous three years into gains.
Issue and Opportunity Identification
The increase in competition and the reduction in shareholder confidence has had a large negative impact on Global Communications stock value. Over the past three years, its stock price declined from $28 per share to $11 per share. This 59% loss in shareholder value minimized confidence in the company and added to the telecommunications industry?s overall financial problems.
The senior leadership team has two policy changes in the works to help turn the decline of the company around and start back on the road to prosperity. The first is the introduction of new and more advanced communication services marketed to small business and individual consumers. These include wireless internet access via phone or personal computers, video, and remote network access through a virtual private network (VPN) to their company?s mainframe. Second, the senior leadership team has identified measures that will improve profits. In support of these initiatives, the company plans to implement an aggressive marketing strategy internationally with the goal of becoming a global source of communication.
Stakeholder Perspectives/Ethical Dilemmas
Global Communication?s President and Board of Directors have several responsibilities. The primary responsibility is to the shareholders that have invested in the company and by doing so have shown confidence in the leadership of the organization to manage in a way that brings in profits. They have a responsibility to the governing laws of the country to operate the company in a way that abides by the laws that govern labor, stocks, operations, and product. They have a personal stake in the success of the company in the form of compensation. Finally, they have a responsibility to act in good faith with the employees working for them.
The senior leadership team also has several areas of responsibility. They must first of all answer to the board of directors as to how they are following the policies and goals as given by the board. They also have a personal stake in the success of the company in the form of compensation. They also have a responsibility to treat the employees fairly, ethically, and manage within the boundaries of labor law.
The union employees who make up the majority of...