Essay PreviewMore ↓
At the beginning of the 2007 fiscal year, Circuit City (CC) announced that it would layoff more than 3,400 of its highest paid employees (Business Week, 2008). The goal of this reduction in personnel was to reduce internal costs by eliminating a large percentage of CC’s upper and middle management. The main issue with this reduction is CC has lost most of its skilled employees and customer satisfaction has plummeted. CC needed to make changes in order to cut costs, but it failed to integrate staffing practices with strategy (Dreher & Dougherty, 2001). The result of this and many other failures at the upper management level is CC shares have fallen 28% in the last year.
The strategy CC chose to use seemed quite simple. Fire its employees and re-hire them at a lower “market rate” wage (Business Week, 2008). This would undoubtedly save the organization a great deal of money and CEO Philip Schoonover thought it was an excellent solution. The problem was CC failed to realize it was firing its key customer service representatives. The employees who made contact with the customers on a daily basis were being let go.
The result of CC firing thousands of employees is it saved money on salaries, but lost a great deal more in sales while increasing customer dissatisfaction. CC failed to integrate staff practices with strategy. These practices require an organization to characterize explicitly its business strategy then make judgments about if existing staffing practices appear to be aligned with strategic orientation. CC fired personnel but failed to see the effects these cuts would have on staff and its ability to satisfy customer needs. The result of this decision is CC shares tumbled to $4.80 during trading on December 21, 2007 hitting a new 52-week low of $4.76 earlier in the session (Business Week, 2008).
AT&T: Anabel Garcia
AT&T, BellSouth and Cingular are in the final stages of merging. The companies see a merger as combining the largest backbone for data with the larger local data provider to increase service capabilities, increase profits and become a global leader. These companies will operate as AT&T to take advantage of the oldest and most well-known brand in telephony. Some analysts believe the Cingular brand appeals more to the “in crowd” of today’s technology users and AT&T recognizes this fact.
These companies want to reduce redundancies in vendors, employee tasks and marketing; doing this will cause layoffs of over 13,000 employees.
How to Cite this Page
"Circuit City Analysis." 123HelpMe.com. 07 Dec 2019
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- In everyday routine, people make hundreds of decisions in their personal and professional lives in response to different situations. For example, whether a particular candidate should be hired for the designation offered or the promotional discount will help to enhance sales or not etc. It is considered that more the background information or data available, the better the human’s ability to make good decisions from the various possibilities (Nauman, 1990). Organisation’s success depends on the alignment of its business processes, resources and values and not only on the employee capabilities working in.... [tags: Best Buy, Circuit City business analysis]
1353 words (3.9 pages)
- Executive Summary During the development from 1949 to 2000, Circuit City achieved aggressive expansion and became the leading company in the industry of electronics retailer. However, fiscal 2000 was an important transition year for the company. The more and more intense competition and the decreasing profitability for years made the company face with unprecedented challenges. These problems were caused by the following reasons: 1. Overexpansion. The company expanded its business and took more and more market share in the cost of decreasing profitability.... [tags: business, analysis, overexpansion]
1808 words (5.2 pages)
- I. Synopsis The Orphans’ Court for Baltimore City has held the State’s petition to forfeit bond in abeyance for three months to give the decedent’s heirs the opportunity to purchase the estate’s home for a price that will satisfy the estate’s creditors. After three months, if the estate’s debt to the State has not been satisfied the judge will decide whether he will grant or deny the petition to forfeit bond. In the event that the judge grants the State’s petition to forfeit bond, Erie may either: 1) Pay the amount of the bond and pursue the principal obligor for the amount of the bond; or 2) Appeal the decision of the Orphans’ Court for Baltimore City a. If the appeal is successful, Eri... [tags: Appeal, United States, Court, Law]
961 words (2.7 pages)
- TIVO Business Analysis TiVo COMPANY BACKGROUND TiVo is a small black box which contains a digital video recorder that allows viewers to watch what they want, when they want to watch it, it allows Pause and instant replay of live TV by storing information on a hard drive. The TiVo Service represents what has been called the “Personal Television Industry” – Total control over the way you watch television. The company established manufacturing partnerships with well established firms like Philips and Sony, and also made some agreements concerning distribution through retail chains such as Best Buy, Circuit City and Sears.... [tags: Business Analysis Management Strategy]
1355 words (3.9 pages)
- ANALYSIS OF A DC CIRCUIT PROBLEM 5 Objective: To Analyse the following DC Circuit using Mesh Analysis & Thevenin’s Theorem. Determine the unknown voltage, Current and Direction of flow across the Circuit. Evaluate Pro’s and Con’s of the Mesh and Thevenin’s Theorem. Assumptions : In the Above Circuit current (I1 , I2 , I3 ) is assumed to be flowing in the conventional direction i.e Clockwise . The Source voltage denoted by XX has been assumed to be 86V. Mesh Analysis Mesh analysis is a method that is used to solve planar circuits for the voltage and currents at any place in the circuit.... [tags: Research Analysis]
1371 words (3.9 pages)
- Success of Circuit City The success of circuit city can be attributed to their concept of strong management, customer service focus and a good merchandising formula which capitalized on innovative electronic consumer products. They created world-class competencies in efficient and effective logistics expertise. Their deployment of sophisticated point-of-sale and inventory tracking technology, IT investments which helped them to connect the flow of information among geographically dispersed stores was the best in the industry.... [tags: Customer service, Sales, Retailing, Best Buy]
1116 words (3.2 pages)
- January 3, 2009 7:34AM. My boss at Circuit City had just dropped me off at my apartment in Hanahan, SC. “Don’t do anything stupid” he said. Knowing that my girlfriend and I were having some relationship problems “Don’t worry I won’t. I’m sure we can talk things out.” I said. Man was I ever wrong. I had forgot my keys when I left the night before. So I walked up to the front door and knocked. No response. I knocked again, and again no response. “She must be sleeping still.” I thought to myself. I walked around the building to where our bedroom window was.... [tags: Thought, Mind, Convenience store]
1487 words (4.2 pages)
- Circuit city was founded in 1949 by Samuel Wurtzel under the original name or Ward’s. Due to Wurtzel’s business skills, President Kennedy appointed him to the U.S. Foreign Trade Mission to Switzerland and Austria. Originally opened as a television store, Circuit City has come to sell almost all electronic goods ranging from television and video products to cell phones and car stereo equipment. Circuit city competes in a consumer electronic market. The main competitors of Circuit City are Best Buy, Comp USA, Wal-Mart, RadioShack, and Amazon.com.... [tags: essays research papers]
329 words (0.9 pages)
- Circuit City - Internet Business Strategy Introduction In the fifty years since Circuit City opened its first store, the company has become one of the best-known sources of consumer electronics in the world. Today Circuit City boasts over 600 stores and more than 50,000 associates. The company consistently strives to offer low, competitive prices, high service standards, and a wide selection of products to meet consumer needs. Circuit City has long prided itself on the outstanding shopping experience it offers to customers.... [tags: Web Business Strategy]
2371 words (6.8 pages)
- TiVo's problem rests in its inability to convince consumers to change their television consumption habits. Improper targeting and positioning have led to an ineffective product, price-point and promotion strategy that has stranded TiVo in the chasm between the early market and the early majority. TiVo is a truly discontinuous innovation, a product that requires consumers to dramatically change their past behavior with the promise of gaining equally dramatic new benefits. TiVo's main challenge is convincing the consumer to buy an expensive product in a new product category.... [tags: Business Case Study]
2172 words (6.2 pages)
The first part of the strategic plan is to layoff 13,000 workers of all ranks. The layoffs result in nearly 60% of cost reductions planned for the merger. The next step is to use the AT&T brand in a new image. It will revamp the logo to be 3-D, use the orange color from Cingular, and use “at&t” in lower case letters for marketing purposes while the AT&T, Inc. will be retained for the corporate name. Another part of the plan includes positioning the combined companies as the lowest cost service provider for all communication technologies globally.
The implementation of the strategic plan has left over 10,000 people out of a job. AT&T has allowed some attrition to take care of cutbacks in employee count and it also plans to repatriate some 3,000 jobs currently outsourced by BellSouth in foreign countries.
New efficiencies using AT&T’s automation realized “…by building work processes around a single network view and not an artificially imposed long haul and local hierarchy,” (Converge Network Services, 2005).
The new AT&T used executives from all three companies to form the governing leadership in the newly formed company softening the blow of the power struggles.
The shareholders are thrilled with the financial results. The mere announcement of the merger made stock prices rise for both companies. The Consolidated statement of income for AT&T, Inc. showed a 97.1% increase in net income from March 2006 to March 2007. The earnings per share are now $0.46 an increase of 24.3% from same period last year. However, not all stakeholders are happy. A blog from a consumer in Lafayette implied Cingular misled the people about the loss of jobs, (www.lafayetteprofiber.com/Blog). The strategic plan is working.
Compare and Contrast Intersect Investment to Benchmark Companies
Circuit City: Anabel Garcia
InterClean needs to make a revolutionary change in how it does business. It must shift from a product based business to a solution based business in a short time in order to stay competitive in the sanitation industry. The result of this change will define InterClean in the years that follow. CC faced a similar situation where it found itself needing to change in order to stay competitive in the sales field. The solution CC moved forward with was firing high paid employees in order to save money. It failed to analyze personnel in the organization and the effect such a change would have on the business. The result of such a move has been customer service complaints, a poorly trained staff, and rapidly falling share prices. InterClean can learn from CC’s failure by conducting a thorough hiring and training process. This internal focus on employees will help ensure future success as it transitions.
AT&T: Anabel Garcia
AT&T has implemented more than one merger over the years and the success demonstrated with the BellSouth and Cingular acquisitions proves this to be accurate. InterClean should use AT&T as a benchmark for strategic plans for mergers. InterClean must develop a new culture, new products, and package new services while integrating EnviroTech into the newly developed InterClean culture. It also must develop a leadership team combining leaders from both companies. The main issue is keeping good employees while being fair to those not kept. AT&T put upper senior management in place for the new company as well as keeping some of the current management staff. InterClean should consider creating a whole new company image as did Cingular and AT&T have done. The financial reports for AT&T prove the plan is a good one for InterClean to adapt.
AT&T Website. (2006, March 5). AT&T, BellSouth to merge. AT&T – News Room. Retrieved October 9, 2008 from http://www.att.com/gen/press-room?pid=4800&cdvn=news&newsarticleid=22860
AT&T (2008). AT&T, Inc. financial data. Retrieved October 10, 2008 from http://www.att.com/Investor/Financial/Earning_Info/docs/IS_IB_1Q07.xls
Business Week (2008). Circuit City Gets Crushed. Retrieved October 10, 2008from http://www.businessweek.com/magazine/content/06
Converge Network Digest. (2005). SBC – AT&T merger to result in 13,000 layoffs, reduced CAPEX. Retrieved October 10, 2008 from http://www.convergedigest.com/Bandwidth/newnetworksarticle.asp?ID=13617
Dreher & Dougherty (2001). Human resource strategy: A behavioral perspective for the general manager. New York: McGraw-Hill.
Lafayette Pro Fiber Blog: (2004, September 26). Cingular merger with AT&T threatens Cingular jobs – including those in Lafayette! Retrieved October 9, 2008, from http://lafayetteprofiber.com/Blog/2004/09/cingular-merger-with-att-threatens.html