Problem Solution: Global Communications

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Running head: SITUATION ANALYSIS: GLOBAL COMMUNICATIONS

Situation Analysis and Problem Statement: Global Communications

Valerie Morford

University of Phoenix

Situation Analysis and Problem Statement: Global Communications

Global Communication stock value has diminished more than 50% over the last three years. International markets are competing for the same business, confidence in the telecommunication industry is waning and stockholders are concerned. There are tremendous economic pressures in the telecommunication industry and Global Communication is no exception to these pressures. The senior team of Global Communication decided cut cost by downsizing their domestic call center and moving it to India and Ireland. This opportunity will reduce unit cost for handling calls by 40%. In order to stay competitive Global has created an alliance with a satellite provider to offer video services and satellite version of Broadband. Global Communications goal will becoming a true global resource by marketing itself aggressively on an international level.

Describe the Situation

Issue and Opportunity Identification

"Advocates of a process called globalization appear to be remarkably united in their assessment of its impact upon labor. They argue that the combined impact of restructuring, reregulation, and relocation signal the end of working class organization as we knew it. They argue that the unions are destined for further decline, that the nation-state can no longer provide protection for workers, and that the only hope for the future lies in attracting multinational capital. The idea that labor might have a progressive role in shaping history and geography has been displaced by the notion that labor has little future at all." There is now something of orthodoxy in much academic debate and political commentary about the future of labor organization as we approach the twenty -first century (Jane Willis 1998).

Pundits argue that the days in which workers could gain leverage over capital and obtain rights in state legislation have been superseded by the process of globalization (Tilly 1995; Hobsbawm1995). It is argued that since the 1970s, in particular, nation-states and labor movements have ceased to be able to protect workers' rights in the face of mobile or "footloose" capital, which is free to move around the world in search of greater returns. With the triumph of the global market, workers are scripted as powerless and unable to defend their jobs, communities, and localities. These analysts argue that the industrial relations climate is one in which places, and those who live in them, are forced to compete for employment, ensuring that employment conditions and regulations are ratcheted down to the lowest common denominator (Beynon and Hudson 1993; Storper and Walker 1989; Burawoy 1985; Korten 1995). As Peck explains:

"Places to live seem increasingly to be reduced to spaces in which to earn, or strive to earn, a wage. Driving forces behind this "geographical degradation of labor" are . . . unfettered global competition and its ally, neo-liberalism. Together, these forces are eroding labor's bargaining strength both "from above," as the actual and potential mobility of capital vis-Ðo-vis labor increases, and "from below," as local social conditions and regulatory standards are dismantled in attempts to expose labor to the market and to attract/retain mobile capital. (Peck 1996)

The issues that are surrounding Global Communications are outsourcing, current employee positions and foreign markets. Company executives did not include the Labor Union the decision or plan to outsource jobs to Ireland and India. The Labor Union is upset because the local call centers will be closed and employees will be laid off and the remaining will be transferred at a 10% pay cut because operating expenses are less. The Labor Union is citing contract manipulation and has spoken out against the strategy. The President of Technologies Workers Union hoped to establish common ground and a win-win with situation Global Communications. The President of the Labor Union realized that negotiations with Global Communication were going nowhere. The Labor Union threatens

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