hrm 630 presentation organizational change
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The Organizational Change
in Chinas Telecom Company
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The Organizational Change in Chinas Telecom Company
China¶ s telecommunication background
Organizational Change in Anhui Telecom Company
Impact of external environment and resistance to change
Impact of internal environment and resistance to change
Organization Development ( OD)
Conclusion
AGENDA
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The Organizational Change in Chinas Telecom Company
Before 1994, China Telecom operated as a state-owned telecom services
In 1994, introducing China Unicom
In 1999, the first restructuring, split China Telecom¶ s business into three
parts ; fixed-line, mobile and satellite which operated by China Telecom,
China Satcom and China Mobile respectively.
In 2002, the second restructuring, China¶ s telecommunication operated
by six telecommunications operators: The China Telecom, The China
Unicom, The China Mobile, The China Netcom, The China Railcom
(Tietong) and The China Satcom
E ntering WTO -- > forced to open market -- > break up the monopoliesand improve efficiency through competition
Thus, in May 2008, The six-telecom companies were merged to three
ones: China Telecom, China Mobile and China Unicom.
China¶s telecommunication background
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The Organizational Change in Chinas Telecom Company
2nd restructuring
2008
3nd restructuring
2002
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The Organizational Change in Chinas Telecom Company
a provincial telecom company, a wholly-owned subsidiary of China
Telecommunication Co., Ltd. has independent corporate status.
The business income and the user scale take the leading position
among its counterparts in the telecommunication operation
market of Anhui Province
Anhui Telecom Company (Anhui Telecom)
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The Organizational Change in Chinas Telecom Company
The difficulties :
o Backward mechanism and obsolete concepts. The enterprise has long been under
the monopoly environment, many operating mechanisms in the enterprise do not fit
the need of market change.
o Network preciseness is low and consciousness of innovation is not high.
o Many employees are unneeded, distribution encouragement mechanism is
unreasonable, labor productivity is low
Thus, In order to adapt to business transition, Anhui Telecom hasmade bold reforms in various aspects, such as business
integration, adjustment of organizational structure and system
innovation..
Organizational Change in Anhui Telecom Company
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Left is before and Right is after the change structure.
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A conceptual model of the organizational change in Anhui Telecom
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The Organizational Change in Chinas Telecom Company
Customers:
o More powerful, more choices
o The total number of subscribers (fixed and mobile) increased by over 15% in 2006,
reaching a figure of 811 million at the end of the year. Growth was especially strong in
the mobile sector, where there were 484 million subscribers in June 2007.
Domestic Market / Competition:
o Badly hit by the fixed-to-mobile substitution trend new services, especially broadband.
China Telecom had limited mobility fixed services, impact on overall revenues
o Upgrading the entire competition level of China's telecom industry.
Government / Regulations:
o F or elaborating regulations, allocating resources, granting licenses, and supervising
the competition, promoting research and development and service quality as well as
for developing tariff rates
Impact of external environment and resistance to change
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The Organizational Change in Chinas Telecom Company
International Market
o Chinese Government applied the policies to encourage, support and help China's
telecommunications equipment businesses path of internationalization
Impact of external environment and resistance to change
Technology:
o China's telecom industry could be more flexibility in providing customization in
products and comprehensive solutions, enhance product quality and Cost control
capabilities to compete with the international market
Suppliers
o More foreign telecom operators in the country will drive telecom equipment
investment in China.
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The Organizational Change in Chinas Telecom Company
Impact of internal environment and resistance to change
Anhui Telecom¶ the transformation effect
o More sensitiveness to the market damage and change for the three centers
(a) Biz Navigator
(b) Integrated Information
(c) Multimedia (Mechanism)
o The customer consciousness of the three centers has been improved
substantially compared with the old mechanism.
o High organization support and distribution fairness will inspire the work
initiative of employees and improve work efficiency.
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The Organizational Change in Chinas Telecom Company
Impact of internal environment and resistance to change
Anhui Telecom¶ the transformation effect
o The organizational transformation has enhanced the confidence of
employees in business prospect.
o The new mechanism is able to inspire the innovative consciousness of
employees
o Telecommunication work is busier, which is attributed to project responsibility.
E mployees need to work over time everyday and even at weekend.
o enhanced absorbability of personnel outside telecommunication system,
enriched the composition of Anhui Telecom¶ s personnel, and injected fresh flood.
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The Organizational Change in Chinas Telecom Company
Impact of internal environment and resistance to change
Anhui Telecom¶ the transformation effect
o The penetration rate of platform business exceeds 40% with customer
satisfaction of 88%. The rural information network won the first-rate prize
of China Telecom.
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The organizational Development in Anhui Telecom is mainly represented in the
following aspects :
The Organizational Change in Chinas Telecom Company
Organization Development (OD)
11 Establishing professional operation supporting organs
22 Promoting new organs¶ position within organization
33 Implementing new rules in the new centers
Implement non-hierarchic management
Expanding the authorities of the general manager
Establishing flexible and diverse personnel selection mechanism
Setting up market-oriented employment mechanism
Setting up salary distribution mechanism in which income matches with
contribution and risk
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The organizational change in Anhui Telecom is the consequence of change in
external competitive environment due to the change of rules and regulations
and development of information technology.
Faced with the dynamic environment, Anhui Telecom industry reintegrated its
organizational structure to inspire dynamic capabilities to develop itsorganizational capabilities, and changed regulation to form a high performance
system.
How to adapt to such changes and maintain sustainable competitive
advantage in the dynamic environment, the experience of Anhui Telecom inorganizational change merits reference.
Telecommunication industries should keep developing sector. To keep
developing, China¶ s government needs to follow international norms and
standards.
The Organizational Change in Chinas Telecom Company
Conclusion