Bt_Has_Experienced_Many_Changes_in_Strategies,_Technology,_Markets_and_Products_over_the_Last_25_Years_Following_Privatization.

BT has experienced many changes in strategies, technology, markets and products over the last 25 years following privatization. [pic] EXECUTIVE SUMMARY BT is one of the world’s oldest Communication Technology Companies operating in 170 different Countries around the world. The 2008/2009 recession has acted as a trigger of change not just for British Telecom but its competitors both National but International. This report would look into through its key elements of the company’s innovative paradigm such as key business process , mission statement, Environmental factors, strength , weakness, opportunities and threats  to the British Telecommunication and the critical success factors involved. Significance of the innovative dimensions within a range of organizational and continental contexts, different innovative and creative management approaches utilized by BT on its quest of change and improvement. The research would also look into Staff retention being a crucial factor in improving BT’s business customer service strategy. Intelligent customer strategy can provide significant competitive gain. However customer strategy is superior to product driven strategy. TABLE OF CONTENTS Executive summary Introduction p4 Finding and analysis p6 Conclusions p13 Recommendations p14 Bibliography p15 2.0 INTRODUCTION BT is world’s oldest communication technology. It operates in 170 countries around the world. Within the company it has five main area of business such as BT Retail BT wholesale BT global BT openworld BT exact “BT recorded a dismal performance last year ending 31 March, 2009 with a turnover of £21,390,000, a loss before tax of £134,000, and a net loss of £81,000. The first of its losses since 2001.” As seen in the case study. Taking into account that “The global telecommunications market went through a fundamental transition from national state owned monopolies to privatized, deregulated competitive markets.  Simultaneously, the new technologies made possible new, innovative services, created new markets and reduced the barriers to entry.” http://www.adbrands.net/uk/bt_uk.htm However,” Excessive investments in non-essential minority stakes left BT with a huge debt mountain by early 2001, and the group was forced to sell off almost all of its international assets in order to repair finances and improve performance. A new management team had repaired most of the damage by the end of 2003 and launched a new expansion drive in the UK, including the aggressive roll-out of broadband, culminating in the launch of a TV broadcast service in 2006.” 1. FINDING ANALYSIS BT management Management style was still the same while the organization was expanding. Mangers are implementing old technique in a large global technical environment this is due to little or no forward planning. Management did not have knowledge of what was happening elsewhere in the organization. This fault is largely due to the organizational structure in place. Sparks (2001), also states the role of the human resource director is to make sure director’s understand the importance of employee motivation and morale when developing the company strategy, making sure the human resource strategy is in line with the business strategy and ensuring the rewards employees receive. [pic] 1 Extracted from Mayle, D. 2006. Managing Innovation and change. BT organization In its expansion the business objectives have been poorly or inappropriate set, or badly measured, and then the organization will not be very effective. Communication between management and employee was lost as the organization became larger and their activities became more diverse, management becomes more difficult. However the ever, increasing power of computing technology seen over the last two decades, together with its decreasing cost, has resulted in business organisations using the capacity to perform more routine data processing. Over the last two decades, there has also been a change in management thinking to accept the importance of the fast effective provision of targeted information for management planning and control. The chief executive officer is the most important role in the management of an organization. According to the BT chief executive States  “Broadband has boosted the UK economy and is now an essential part of our customers’ lives. We now want to make a step-change in broadband provision which will offer faster speeds than ever before.” http://www.btplc.com/report/report04/Corporategovernance The “BT’s policy is to achieve best practice in our standards of business integrity in all our operations. This includes a commitment to maintaining the highest standards of corporate governance and ethics throughout the group.” [pic] 2 Extracted from Mayle D. 2006. Managing Innovation and change. CULTURE BT as an organization, lays emphasis on shareholder values over shareholder value. Its history over the years tells us it values responsibility over profitability to shareholders and the organization is seen more like a joint venture where all work for the collective good of the company rather than an instrument of profit. A partnership where all interests are balanced and shareholder representation is encouraged. These norms and values are deeply embedded into BT’s culture and to successfully change them is a difficult task and must be handled delicately. BT has reached a stage of discontinuous renewal with emphasis on revolutionalizing its financial decisions, requiring a turnaround to a profit making position again. The magnitude of change is expressed in its recent decisions to lower employee pay. This has led to its Union CWU Balloting its members to go on strike. "We're obviously very disappointed that BT has not improved its pay offer ... we now have no option than to put the wheels in motion to ballot all appropriate members in BT for strike action, said CWU deputy general secretary Andy Kerr.” (Reuters) - Staff at telecoms provider BT are to be balloted on industrial action after the company declined to improve on a 2 percent pay rise offer, the Communication Workers Union (CWU) http://uk.reuters.com/article/idUKTRE6531QD20100604 extracted 08 June, 2010. This unsteady pace of change is unwelcome by its employees who see it as as abrupt and unsteady decision by management of BT to have their way and crush the Union as well in the process. BT at the moment is under intense pressure to give into the demands of the union. However, this unstable situation is the best stage where BT is open to innovative ideas. At this stage, the company is seen to be on the line of chaios. SIGNIFICANCE OF INNOVATIVE DIMENTIONS. “Though China is lagging behind in the implementation of regulatory disciplines, nevertheless, it has gone a long way towards complete transformation of its telecom sector with little or no outside influence or control. The joining of the WHO galvanized the government to ensure telecom plays its full role as a strategic economic sector and help deliver economic benefits to the Chinese people in order to legitimize the Communist Party Leadership”. Roseman, D. (2005) The WTO and Telecommunication Services in China: Three years on. Volume 7 issue 2 pg. 32 More research on the developing countries goes on to say: “ Based on the four-dimensional model of service innovation, regression analysis show that strategic attention, supportive culture, market differentiation and variations in demand have made positive effects on innovative dimensions in Knowledge Intensive Business Services (KIBS) of China. On the other hand, innovative behaviors of individual workers did not affect the innovative dimensions in KIBS of China in a direct manner” Liu, S. (2009). International Journal on Technology Management Volume 8, No.1 pp. 104. These findings are in contrast to ideals in the developed West where a CEO of 3M once said: “3M is people and our opportunity to succeed depends upon the capabilities of our people. The best and hardest work is done in the spirit of adventure and challenge”. MaKnight, W.L. But more importantly, the spirit of innovation or the most important innovative forces can be looked at in three dimensions: • Time • Effort • Space. “The introduction of e-mail, for example, reduced the time needed to send a letter to almost nothing, it eliminated the effort associated with processing and carrying the letter, and it also managed to shrink geographical space by allowing instantaneous transmission.  As a result, the costs associated with sending a letter were reduced substantially.  We might therefore say that the socioeconomic importance of any innovation is related to how strongly it collapses time, effort or space”. http://www.innovativecapacity.com/EconSocDim.htm 3.1 The new century following the global recession of 2009 and to grow and regain a profitable position in the market The crash of 2008 is already recognized as one of the largest financial crises to have hit the international capitalist economy in the last hundred years. When the first global recession came in the world it destroyed the whole economy of the world. The reason of that recession was World War II. However, BT needs to focus on customer satisfaction which is critical component of profitability. Although getting customers is hard enough keeping them is the greatest challenge of all. Zeithaml et al (1990) states that service quality is a winning strategy and a profit strategy, despite the markets targeted, pricing policies pursued or the variety of services offered. They believe the foundation for competing is perceptions service quality. Although, BT has of the largest IP network in the world although the “BT is investing £ 10 billion in its internet protocol (IP)-based 21st Century Network (21CN) which puts the customer at the centre of all new services, offering them control, choice, flexibility and resilience.” See BT Innovation Journal - Current Volume, Information Security Risk Management, By:Carl Colwill - BT Design Security Risk and Compliance. According to BT chief executive Ian Livingstone said: "Assuming an acceptable environment for investment, we see the potential to roll out fibre to around two thirds of the UK by 2015."The extra optical fibre investment could be the result of profits announced by BT today as it released its 2009-10 financial results. The company announced pre-tax profit of £1bn, compared with 2009's £244m loss.” http://uk.news.yahoo.com/16/20100513/ttc-bt-to-invest-extra-1bn-in-fibre-roll-6315470_1.html On the other hand “Effective global sourcing security and governance will become a key business success factor.” Ibid p.12. Several HR tools that can be used by BT which are; recruitment and selection, learning and development, employee reward, employee relations performance management, performance appraisal, induction and service climate. 3.2 New Innovation Strategies, Products and Vision The CEO should put in place. [pic] 3 Extracted from Mayle, D. 2006. Managing Innovation and Change. Without a clear insight of the The knowledge value stream, growth will continue to elude the organization. Innovation is usually new technology being turned into something unique and tangible that the company can sell. Innovation is key to long-term business sustainability. According to UK DTI innovation unit define innovation “successful exploitation of new ideas” http://www.itpreport.com/default.asp'Mode=Show&A=1019&R=GL Although “It is not telecoms that gives BT a unique advantage other telecommunications companies have similar advantages. It is the fact that BT is, and always has been, an innovator. It is this capacity for and history of innovation that is the source of BT’s unique advantage.” See itp p2 date accessed 20-05-10 According to Matt Bross, chief technology officer for BT states that “Adapting business models around new technology is the key step to fostering innovation effectively.”Business and technological innovation are inseparable.” http://www.the-chiefexecutive.com/features/feature710/ Information systems are indispensable to the business, industry, academia and any other organization to meet the future challenges.BT “did not invent or improve DSL, it has adapted and provided ADSL2+ broadband to 10 million homes. Thus, BT keeps on improving its fixed-line services and has adopted a non in-house incremental innovation as one of its services.” See BT Innovation Management Strategy Analysis 2010, (Apr 6, 2010) by: Melvin Tandoc Marketing information systems. Marketing strategy based on the information flow backed by marketing information system could result in significant benefits for BT. This strategy can attract investors. 3.3 contrast and compare the strategies, culture and innovation management between BT and other telecommunications companies According to Communications watchdog Ofcom states that “BT opening up its fibre networks to rivals is key to spurring the development of super-fast broadband services.” http://www.itpro.co.uk/621763/ofcom-says-bt-must-share-with-rivals BT vs. Vodafone. “BT was the third biggest spender on R&D after drug maker GlaxcoSmithKline and AstraZeneca, and mobile network operator Vodafone was the 14th” ComputerWeekly.com (02 March,2010) extracted on 08 June, 2010. This findings clearly puts BT amongst the leaders in Innovation. Other competitors of BT are France telecom, DT Deutshe, Cable & Wireless plc , telekom AG in the Industry, non of who have the structure or capabilities BT has on groung. 4.0 CONCLUSION To conclude it can be said that Satisfying customer expectations is core to profitability. However, technology is a critical element of business. Technology is more important to BT Therefore, the statement that MIS is a tool to assist the middle level and top level management in decision making, and as to whether it applies to organizations of all sizes is in fact true as the design and use of MIS is unique to every business as the needs of one organization differs from the other. The common element in all these is the tools capabilities to ensure effective and efficient long-medium-short-term decisions of an organization. Although, BT is trying its level best to resurface again as the giant of telecommunications it once was. 5.0 RECOMMENDATIONS • Some recommendations to CIO create a marketing Information systems strategy if you don’t have one. • Marketing information systems would result in significant benefits for the organizational goal orientation of BT. • Must confirm the current state and the future state, and determine clearly what needs to change. • Customer strategy general complaints about customer services provided by BT • IT managers must be deeply knowledgeable about business areas, broadly aware of new technologies, and able to bridge the tech and business worlds. • A successful MIS can only be designed and operated with due regard to organization and behavioural principles as well as the structures. Implying that management must be knowledgeable enough to effectively contribute to the system design and information specialist must understand managerial functions and needs so that both can develop effective MIS • Staff training every two months • BT needs to increase innovation in its Information Technology functions BIBLIOGRAPHY Liu, S.(2009). International Journal on Technology Management Volume 8, No.1 pp. 104. Mayle, D. (2006). Managing Innovation and Change. Third Edition. Pend, L., Zhang, L. (2009). The Study of Service Innovations Model for Chinese Telecomm Operators. Pg. 670. Roseman, D. (2005) The WTO and Telecommunication Services in China: Three years on. Volume 7 issue 2 pg. 32 Sparkes, J. (2001).  Job's a good'un (human resource directors' roles) Journal of People Management UK, Vol. 7 No. 20, p44-46. Zeithaml, A. V., Parasuraman, A., and Berry, L. L. (1990). Delivering quality service: Balancing Customer Perceptions and Expectations. New York: Free press. Pg27 1. www.bt.com 2. See BT Group (UK) http://www.adbrands.net/uk/bt_uk.htm p.1. Date accessed:20-05-10 3. See BT Innovation Journal - Current Volume, Information Security Risk Management, By:Carl Colwill - BT Design Security Risk and Compliance. http://www.btplc.com/Innovation/Journal/BTIJ/current/HTMLArticles/Volume01/02Information/Default.aspx p.1. Date accessed 21-05-10 4. BT to invest extra £1bn in fibre rollout, http://uk.news.yahoo.com/16/20100513/ttc-bt-to-invest-extra-1bn-in-fibre-roll-6315470_1.html p.1. Date accessed: 19-05-10 5. See itp http://www.itpreport.com/default.asp'Mode=Show&A=1019&R=GL p2 date accessed 20-05-10 6. See BT Innovation Management Strategy Analysis 2010, (Apr 6, 2010) by: Melvin Tandoc See Ofcom says BT must share with rivals , Regulator Ofcom details the latest measures to kick-start 'super-fast' broadband uptake – and finally specifies what the label actually means. (24 Mar 2010) By: Martin James http://www.itpro.co.uk/621763/ofcom-says-bt-must-share-with-rivals p.1. Extracted on 23 May,2010 7. (Reuters) - Staff at telecoms provider BT are to be balloted on industrial action after the company declined to improve on a 2 percent pay rise offer, the Communication Workers Union (CWU) http://uk.reuters.com/article/idUKTRE6531QD20100604 Extracted 08 June, 2010. http://www.innovativecapacity.com/EconSocDim.htm Innovative Capacity by Suarez-Villa, L. Extracted 09 June, 2010. PICTURE WEBSITE Picture taken from the following website http://www.08direct.co.uk/blog/wp-content/uploads/2009/01/bt3.jpg Date accessed: 20-05-10