Global Communications is facing many problems. Due to high competition in the telecommunications sector, Global Communications stock prices have fallen drastically. Many of its competitors, mainly the cable companies, are offering complete solution packages. Global Communications decided to create a strategic plan to cut costs by outsourcing. This strategic plan has caused issues between Global Communications and the Technologies Workers Union. The main issues are the lack of communication and the distributive negotiations method.
Situation AnalysisIssue and Opportunity IdentificationAn unpleasant relationship currently exists between Global Communications and Technologies Workers (Union) because of the last negotiations between the two parties. The result of the last negotiation was that the Union gave up over 20% of their education and health benefits due to Global Communications' financial problems. Global Communications created a strategic plan to outsource and downsize its technical call centers. However, Global Communications did not communicate this plan to the Union.
As a result of this plan, some employees will be relocated to expanding call centers and will be expected to take, on average, a 10% pay cut while many others will lose their jobs. Global Communications failure to communicate to the Union that this plan was necessary in order for the business to become profitable and competitive, led to further destruction of the already fragile relationship. "Effective communication is vital to all organizations because it coordinates employees, fulfills employee needs, supports knowledge management, and improves decision making" (McShane & Von Glinow, 2005, 324). Because the decision has already been made to outsource, Global Communications can take this opportunity to begin working on a plan with the Union that will create and keep as many jobs while reducing costs and maintaining profitability once the company has become competitive and profitable again.
Global Communications is facing increasing competition from local, long-distance, and...