Telecommunications

& Strategic Planning I.

Richard A. Gershon, Ph.D.

School of Communication
Western Michigan University

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 Strategic Planning
 Strategic planning is the set of
managerial decisions and actions
that determine the long term
performance of a company or
organization.

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 Strategic Planning: 4 Steps
 Researchers Wheelen and Hunger
(1998) suggest that there are
four steps involved in the strategic
management process. They include:
 1. Environmental Scanning
 2. Strategy Formulation
 3. Strategy Implementation
 4. Evaluation and Control

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 I. Environmental Scanning
 Environmental scanning is the ability to identify
strategic factors (both external and internal to
the organization) that can significantly impact
the firm's business operations.

 Environmental scanning requires the ability

to assess the internal strengths and weakness
of the organization as well as the external
opportunities and threats to the organization.

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 SWOT Model
Table 1.
Strengths, Weakness, Opportunities
and Threats (SWOT) Model

Internal
1. strengths of the organization
2. weaknesses of the organization

External
3. opportunities for the organization
4. threats to the organization
___________________________________________________

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 Triggering Event

 The need for strategic planning is

sometimes caused by a triggering
event. A triggering event can be
caused by:
 Changes in the competitive marketplace
 Changes in the management structure of
an organization
 Changes associated with internal
performance and operations

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 The External Environment
 The external environment can include a
number of different forces that can impact
the performance and operations of an
organization, including:
 1. Competitive Factors
 2. Political/Legal Factors
 3. Economic Factors
 4. Technological Factors
 5. Sociocultural Factors

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 Competitive Factors
 Competitive factors are
the business strategies
and actions of one’s
competitors.
 The competition may have
designed a better product
or service. Examples:
 Sony vs. Microsoft Videogame
 Nokia vs. Motorola Cellular
 Verizon vs. AT&T Telephony

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 Political/Legal Factors
 Political/legal factors represent
changes in the political and regulatory
environment that can significantly
influence the business operations of
a company or organization. Examples:
 Cable Communications Policy Act of 1984
 The AT&T Divestiture (breakup), 1984
 The Cable Television Act, 1992
 The Telecommunications Act of 1996

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 Economic Factors
 Economic factors are
marketplace changes that
can help or adversely affect
your business operations.
 1. Spiraling inflation
 2. Economic recession
 3. Natural calamity
 4. The availability of a
product substitute

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 Technological Factors
 Technological factors
represent advancements in
new technologies that can
help or adversely affect
one’s business.
 1. Direct Broadcast Satellite
 2. Apple iPhone
 3. MP3 File Sharing
 4. Cable Modems
 5. High Definition Television

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 Sociocultural Factors
 Sociocultural factors are
social/ cultural changes in
the environment that may
affect a consumer's buying
habits, product usage etc.
Examples:
 1. Consumer reaction to animal
furs, etc
 2. Student attitudes about software
piracy
 3. Privacy and security while
purchasing merchandise on the
Internet.

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 Internal Factors that Can
Influence Business Operations
 The internal environment can
include a number of different forces
that may affect organizational
performance:
 1. Core Competency
 2. Organizational Decisionmaking
 3. Organizational Culture
 4. Management / Labor Relations
 5. Operational Issues

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 Core Competency
 The term core competency describes something
that an organization does well. The principle of
core competency suggests that a highly successful
company is one that possesses a specialized
production process, brand recognition or ownership
of talent that enables it to achieve higher revenues
and market dominance when compared to its
competitors.
 Core competency can be measured in many ways:
 brand identity (Disney, ESPN, CNN)
 technological leadership (Cisco, Intel, Microsoft)
 superior research and development (Sony, Philips)
 customer service (Dell, Amazon.com).

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 Organizational Decisionmaking
 To what extent does an organization
and its management structure make
well informed and timely decisions?
 Does the organization promote
initiative,creative thinking and foster an
entrepreneurial spirit or does it adhere
to a rigid bureaucracy?

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 Organizational Culture
 Organizational culture (or corporate culture) refers
to the collection of beliefs, expectations and values
shared by an organization's members and
transmitted from one generation of employees to
another. Examples:
 1. Sony – co-founder Akio Morita; strong commitment to
high quality engineering and design products
 2. Bertelsmann – founder Reinhard Mohn; strong adherence
to decentralized management
 3. Google – less structured environment; strong adherence to
innovation and experiment

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 Organizational Culture (cont.)
 Organizations (even large ones) are always human
constructions; that is, they are made and transformed
by individuals.
 Culture is embedded and transmitted through both
implicit and explicit messages such as formal
statements, organizational philosophy, design of
physical space, deliberate role modeling and teaching
by leaders.
 The more highly successful companies are those
that exhibit a strong organizational culture. There are
several component parts to a strong organizational
culture, including: 1) values, 2) heroes, and 3) rites
and rituals
Deal & Kennedy, 1982.

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 Management / Labor Relations
 Management / labor relations
involves the working
relationship between
management and the people
who work for the organization.
There are several important
considerations:
 Is the organization unionized?
 Are staff salaried or paid by the
hour?
 What kind of benefits does the
organization offer its employees?
 Do employees have the proper
equipment in which to their jobs?

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 Operational Issues
 Operational issues involves
developing the optimum
conditions for creating and
producing quality products and
services in a cost effective
manner.
 1. Staffing levels
 2. Employing talented people
 3. Providing the proper equipment
and support services.
 4. Good internal and external
communication
 5. Quality Control
 The goal is to achieve Total
Quality Management (TQM).

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 Total Quality Management
 Total Quality Management (TQM) represents an
approach to management, whereby, the entire
organization is fully engaged in delivering quality
products and services to its customers.
 The principles of Total Quality Management date back
to the 1940's to the work of American business
consultants W. Edwards Deming and Joseph Juran,
who were involved in helping to resurrect Japanese
industry in the aftermath of WW II. There are four
important elements that characterize TQM in action.
They include:
 1. Employee Involvement
 2. Focus on the Customer
 3. Benchmarking
 4. Continuous Improvement

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 TQM in Action
 Employee Involvement
 TQM infuses the value of quality throughout every activity
within an organization. TQM requires company wide
participation in quality control. Workers must be trained,
involved and empowered. Employee involvement in key
decisionmaking helps promote a sense of ownership in the
outcome.
 Focus on the Customer
 One of the underlying principles of TQM requires that
everyone be considered a customer. Customers fall into two
basic categories; external and internal. External customers
are those people including suppliers and buyers who engage
the organization from the outside. Internal customers are the
various people and departments within an organization who
depend on each for materials and logistical support.
Example: Marketing

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 TQM in Action
 Benchmarking
 Benchmarking takes into consideration the idea that one
can and should learn from the competition. The competition,
for example, may have a superior product, service or work
process. Benchmarking presupposes the ability to find out
how others do things and then tries to imitate or improve
upon it.
 Continuous Improvement
 TQM emphasizes the importance of continuous
improvement as the basis for producing long term results.
It is the counter opposite to the quick fix solution. Everyone
within the organization from senior management to the
worker on the floor has a responsibility to improve product
and service quality.

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 Six Sigma
 In 1986, Bill Smith at Motorola Corporation developed a set of
process improvement strategies known as Six Sigma. The term
Six Sigma refers to a highly capable process designed to produce
outputs within highly demanding specifications.
 The goal of Six Sigma is to systematically improve processes by
eliminating defects. Six Sigma is first and foremost "a business
process that enables companies to increase profits dramatically by
streamlining operations, improving quality and eliminating defects
or mistakes in everything a company does.
 Six Sigma's implicit goal is to improve all processes to that level
of quality or better. The principles of Six Sigma are especially
important to companies engaged in the manufacture of high-end
computer and communications equipment.

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 GE and Six Sigma
 In the early 1990s, then GE CEO, Jack Welch
was told was told that Six Sigma, the quality
program pioneered by Motorola, could have a
significant effect on improving GE’s operational
performance.
 Although skeptical at first, Welch initiated a
major strategy initiative to infuse Six Sigma
thinking into every aspect of GE’s business
operations. He made quality the responsibility
of every employee on the shop floor.
 All senior managers were expected to undertake
Six Sigma training. Their promotions and
bonuses were directly tied to Six Sigma results
within the company. Six Sigma, in Welch’s
view, did more to change the DNA of how GE
did business than any other program.

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 What is Six Sigma?
 Six Sigma is a highly disciplined process that helps a business
(or organization) focus on developing and delivering near-perfect
products and services. Why "Sigma"? The word is a statistical term
that measures how far a given process deviates from perfection.
 The central idea behind Six Sigma is that if you can measure how
many "defects" you have in a process, you can systematically figure
out how to eliminate them and get as close to "zero defects" as
possible. In order to realize the exacting standards of Six Sigma,
a business process should not produce more than 3.4 defects per
million opportunities.
 A “defect” is defined as a failure to deliver what the customer want.
An "opportunity" is defined as a chance for nonconformance, or not
meeting the required specifications. This means that an organization
needs to be nearly perfect in executing its key processes

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 What is Six Sigma? cont.
 Central to the discussion of Six Sigma are three important elements:
the customer, the process and the employee.
 The Customer.
 The customer should form the center of the universe for a
business. Their expectations include, a high quality product or
service, on-time delivery, competitive prices, reliability and
good customer support.
 The Process.
 Achieving Six Sigma level of performance presupposes the
ability to look at business process from the perspective of one’s
customers. They understand better than anyone what works
best and least in terms of their interaction with the company or
organization. The customer’s routine feedback provides the
basis for making on-going improvements as a whole.
 The Employee.
 People make the difference. One of the important goals of
Six Sigma training and thinking is to empower managers and
employees to make decisions on the shop floor. Quality is the
responsibility of every employee.

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 What is Six Sigma? cont.

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 Walt Disney and Customer Service
 The Walt Disney Company is first and foremost in the
business of family entertainment.
 Walt Disney Attractions is responsible for the operation
of the company's theme parks and corresponding venues.
The two primary theme parks are Disneyland in Anaheim
California and Walt Disney World located in Lake Buena
Vista, Florida. The Walt Disney World resort features
4 major theme parks:
 the Magic Kingdom
 Epcot Center
 MGM Studios
 Animal Kingdom

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 Team Disney
 Creating the Disney experience is largely dependent upon the 35,000
Walt Disney staff members. They are responsible for translating the
Team Disney approach into action. The Walt Disney Company
employs one of the most sophisticated employee training programs in
the world.
 Training begins with an appreciation for the fact that appearance is
everything. Disney employees are referred to as cast members.
The presentation includes everything from the way in which Disney
employees interact with the public to the clothes they wear. In creating
the right appearance, cast members are taught to be polite. They are
taught to understand that park attendees are to be treated as guests.
And that helping a guest often means going the extra mile.
 In addition, Disney employees are expected to follow a dress code and
are not permitted to eat, drink, smoke or chew gum in front of guests.
At all levels, Walt Disney World is about creating an impression that
the park is safe, accessible and fun.

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