Onetel Case Study

Onetel Case Study

Length: 1655 words (4.7 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
Background
One.Tel was launched by Jodee Rich and Brad Keeling in 1995 (Cook, 2001). At first, it looked to get the advantages from deregulation of telecommunication industry by reselling other network’s capacity and making money through stock market speculation. Rich and Keeling tried to increase the company’s shares rather than to profit the company (Cook, 2001). Initially, One.Tel used to develop the culture of strong teamwork and togetherness. There was no hierarchy in the structure of the company. However, the dissonance of its culture and system is the main factor that led to One Tel decline.
One.Tel failure had been indicated since there was a sharp fall in its share price in 1999 (Cook, 2001). In 2001, OneTel had no cash left to pay the expenses and it had huge debt. The company expanses too fast so that the billing system cannot handle it and the customers did not receive their accounts. Jodee Rich, as the main founder of the company, did not pay attention to any problem reported. All these factors made One.Tel could not stand in the crisis time.

Major Issues
Major issues face by OneTel is that the company structure was not developed, in which lead to ineffective communication. In its operation, One.Tel run high centralization as the managers only do what Jody told them. He creates the leadership turnover since he liked promoting the yes man and humiliated managers who brought problems to his attention, therefore, there are high staff turnover. He also did not accept any opinions from others and used his authority to manage the company. Furthermore, he focused too much on advertisement in taking in the new customers. He was too autocratic which made the employees unable to exercise their ability in solving problem.
In addition, One.Tel had low complexity that is determined by having unclear job tasks and responsibilities. As there is no organizational chart, the relationship between the employees could not be determined and the job descriptions were ambiguous. Understaffing, which often happens, and many called from customers were left unanswered, led to the long-term decline in sales, as there was frustration among the customers. No rules and procedures in handling account and customers complaint shown that One.Tel was lack of formalization in operation. One.Tel also did not run its divisions’ function properly. There was no right procedure in training staff and it recruited young inexperienced staffs. It also had disorganized billing system and financial account.

How to Cite this Page

MLA Citation:
"Onetel Case Study." 123HelpMe.com. 16 Sep 2019
    <https://www.123helpme.com/view.asp?id=166662>.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay on Case Study: Effective Managerial Leadership

- Case Study: Effective Managerial Leadership The successful implementation of a public policy to solve a social problem will greatly depend on the abilities of a public administrator. Furthermore, numerous case studies can show examples of how a successful public agency administrator can achieve goals through dedication and commitment. The following discussion will present a thorough analysis of main political, social, and economic forces that affected Dr. Gayle in establishing legislation to fight the AIDS epidemic as is presented in the case study Managing Across Boundaries: A Case Study of Dr....   [tags: Case Study]

Research Papers
1201 words (3.4 pages)

Amyotrophic Lateral Sclerosis Case Study Essay

- Case Study: A thirty six year old male has developed severe muscle weakness throughout the body. The condition began fifteen months ago with a left foot drop and within a year, he described difficulty with speech and swallowing, muscle twitching and cramping, and muscular atrophy throughout the upper and lower limbs. Within the last two months, his breathing has become more difficult, and there has been a noticeable difference in his voice. Prior to the fifteen months, he presented little to no symptoms....   [tags: Case Study]

Research Papers
1519 words (4.3 pages)

Essay on Apple & Foxconn Case Study

- Foxconn: Impact of globalization on labor conditions. Hon Hai Precision Industry Co., Ltd which trades as Foxconn Technology group or as the media calls it Foxconn has been in media limelight recently due to labor problems that have surfaced from the organization. Foxconn is a major equipment manufacturer supplier to electronics giants like Blackberry, Apple, Microsoft Xbox, Sony PlayStation and the Nintendo Wii. The internet has several articles and controversies regarding the deplorable worker conditions and cases of suicides by the workers....   [tags: Foxconn Case Study]

Research Papers
2511 words (7.2 pages)

Essay on Principal Miller Case Study

- Leaders in the school have hard decisions to help make on a daily basis. They need to evaluate their decisions to make sure they are ethical and effective. Administrators need to listen to all sides of a situation and evaluate all options before they make a decision. This process is difficult because administrators need to make sure that all parties involved are satisfied with the decision that was formed. The Requested Change case study In the case study with Principal Miller, he had to make a decision to change the instruction program or to keep it....   [tags: Decision Making Case Study]

Research Papers
1523 words (4.4 pages)

Childbirth Case Study Essay

- The case study that I will be looking at in this assignment is case study 2. This relates to Niamh and her partner who are pregnant with their second child. Their daughter from the previous pregnancy is now four years old, but the memories of the birth have caused anxiety to linger with them as they found it to be very traumatic. They are both very excited and happy to be pregnant again and are looking forward to the arrival of their second child. However, they both have very differing views on the delivery....   [tags: Psychology Case Study]

Research Papers
1457 words (4.2 pages)

Puma Company Case Study Essay example

- Course: International Business Management Activity: Case Study Company: PUMA |1924: |Rudolf and Adolf Dassler incorporate their first shoe company. | |1948: |Rudolf Dassler sets up his own company Puma Schuhfabrik Rudolf Dassler. | |1950: |Puma had established export ties to the United States, | |1959: |Rudolf Dassler's wife and two sons become part owners of the Puma Sportschuhfabriken Rudolf Dassler KG....   [tags: Business Case Study]

Free Essays
1746 words (5 pages)

Critical Thinking Case Study Essay example

- Critical Thinking Case Study Chris had just been promoted as an Executive Assistant for Pat the CEO, Chief Executive Officer, of Faith Community Hospital. Pat had given Chris her very first assignment on her first day of work as an executive assistant and that was to gather information so that Pat can present the issues to the board of directors....   [tags: Business, Case Study, solution]

Free Essays
1794 words (5.1 pages)

Texaco Case Study Essay

- Symptoms of Problems at Texaco Identification of Root Problems and Unresolved Issues Highly qualified African-American employees filed a class action suit against Texaco in 1994, stating that the company failed to promote African-American employees to a higher position and it failed to compensate them in relation to Caucasian employees in similar positions. Throughout the investigation of Texaco if was found that documents would potentially damage Texaco were being withheld. When secret tape recordings from Texaco executives revealed not only vilely insensitive racial attitudes but it also demonstrated the eagerness of the executives to withhold any and all sensitive internal documents per...   [tags: Business Case Study]

Research Papers
995 words (2.8 pages)

Starbucks Case Study Essay

- Introduction Since its' 1992 IPO, Starbucks has continually focused on growth. Initially, the growth was targeted to enable Starbucks to achieve their goal of becoming the leading North American retailer of specialty coffee. The early success they achieved resulted in Starbucks expanding their original goal to that of becoming the most recognized and respected coffee brand in the world. By way of example, this case study focuses on a request by McDonalds to serve Starbucks coffee at its' restaurants in order to discuss the marketing strategy and the underlying competitive premise that Starbucks has adopted to achieve both of their goals....   [tags: Business Case Study]

Free Essays
1449 words (4.1 pages)

Wal-Mart Case Study Essay

- WAL-MART CASE STUDY WAL-MART CASE ANALYSIS Impressions Wal-Mart is a company that leads its industry in numerous areas. The areas which impress are the accomplishments the company has made. “About 140 million people in 11 countries shopped at Wal-Mart …every week. More than half of American shoppers visited Wal-Mart at least once a month…an estimated 82 percent at American households have made at least one purchase at Wal-Mart” (Bianco, Zellner, 2003). Less impressive is the company being involved in over 6000 active lawsuits and what seems to be a proven track record of forcing out smaller business in the areas it locates to, putting many people out of work....   [tags: Business Case Study]

Research Papers
865 words (2.5 pages)

Lastly, there was no clear planning of staff training, advertising, and product availability, which made the technology wasted.

Theories
1. Organizational culture
Organizational culture is a system of shared meaning within an organization, which composed beliefs and assumptions (Robbins & Barnwell, 2006). Besides, there are common values that facilitate understanding among members (Robbins & Barnwell, 2006). There are terminal values and instrumental values. Terminal value is the outcomes that want to be obtained. Instrumental value is the degree of formalization to achieve certain desired behavior modes in achieving terminal goals (Robbins & Barnwell, 2006).
There are four forces is sustaining the culture in the company (Robbins & Barnwell, 2006). First, it is selection practices, which is the process of selecting and hiring the best candidates who have the abilities, skills, and knowledge to do the job successfully in the organization. Second, it is actions of top management, which has influence to bring the organization culture. The top management plays an important part in decision making, planning, and controlling the organization. Third, it is socialization, which is the process of the new employee to adapt and learn the organization’s culture, rules, and beliefs, and to socialize with their fellow staff. It can be done by induction courses and training programs. Lastly, it is use of appropriate reward and punishments, which has function to send the powerful message to all the organization’s members.
Some unique characteristics of One.Tel is they tried to build good relationship between the employees. It aimed to make fun and friendly environment for people who are working there. There were all in one partitions without office and organization chart was banned. It tried to create the strong culture of sense of belonging to the company.

2. Size structure relationship
The organizational structure has a major role in daily operation of organization. It facilitates the delegation of authority and operation of control and communication systems (Organisation Structure, 2003). There are different criteria for determine the best structure that suit an organization, include geographic area of operation, the organization’s size and the culture of the organization (Organisation Structure, 2003). It needs to create division of labour and integrate the complexity, formalization, and centralization to ensure the organizational effectiveness. Formalization refers to the degree to which rules, procedure and lines of responsibility are specified (Organisational Structure, 2003). Centralization refers to the degree of authority and decision is at higher levels of the organization Organisational Structure, 2003). Complexity refers to the degree of differences of tasks, jobs, or level in the structure of organization (Organisational Structure, 2003). There are five types of structure, which are the simple structure, machine bureaucracy, professional bureaucracy, divisionalized form, and adhocracy (Shcmidt, 2006). Simple structure, which is used by One.Tel, has high centralization, low vertical differentiation, and low formalization.

3. Henry Mintzberg’s 5 elements
The five basic organizational parts are the strategic apex, the middle line, the operating core, the technostructure, and the support staff (Shcmidt, 2006). The strategic (manager) acts as the brain of the organization, developing visions and strategic goals. The middle line (employee) connects the operating core to the strategic apex. The operating core is all employees who work directly to produce the organization product. The support staff represents staffs that support other part of organization by ensuring they optimize their work (Shcmidt, 2006).

4. Sources of Power
There are 5 sources of power, include coercive power, reward power, legitimate power, expert power, and referent power (Five base of power, 2004). Reward power is the power of promising and granting reward (Five base of power, 2004). Coercive power refers to the power to threat or give the punishment. Legitimate power is the power based on the position in the organization structure. Expert power is the power to share the knowledge and information. Referent power is the power from someone’s personality. The uses of power in One.Tel are in the form of poor leadership, ambiguity task and fear.

Recommendations
Firstly, One.Tel should develop the professional bureaucracy in its structure, which has the standardization in its procedures, high decentralisation and requires high differentiation, especially vertical differentiation (Shcmidt, 2006). Establishing the hierarchies and organization chart equals to establishing the clear communication line and power. A large company needs to have each division with different special responsibilities and task in order to create the efficient and effective functions. When the communication is well developed, the employees’ productivity will increase. Furthermore, a well management system must be developed and implemented properly to ensure that its business plan is able to achieve the desired objectives. It also will eliminate the problem of too fast expansion and other operational and managerial problem. Therefore, it is important for the company to make the detailed planning, discipline the procedures, and do budgeting and account keeping for tracking its financial status. In addition, as the leader, Rich and Keeling should change their attitude in managing the company. They should make the power decentralized in order to keep the task processing and decision making faster. They also must be willing to listen and pay attention to the employees’ report of the company situation and their opinions. Besides, it would be better if Rich and Keeling focus in solving the problem in the organization, rather than making new customers. It is necessary to establish performance based compensation system to encourage and motivate workers to work harder and perform better. Lastly, it should build the detailed strategic plan and business plan, such as to establish the goals, forecast the staff need, guide company to achieve its goals, to gain competitive advantage, and lead company to future direction.

Conclusion
One.Tel was launched in 1995 and it was the Australia’s largest telecommunication company before collapsing in 2001. It established the culture of fun and friendly environment and no hierarchy in its structure, which actually contributed to the One.Tel failure. Besides, there are more problems during One.Tel operation. The leader used autocratic style to manage the company. The company expanses too fast thus the billing system cannot take pace. By the year 2001, the glory on One Tel end as the company had huge debt and there was no cash left to play expenses.
The theories that can be applied and relevant to One.Tel case include organizational culture, size structure relationship, Henry Mintzberg’s five elements and five sources of power. In order to establish good structure, One.Tel should change the structure from simple structure to professional bureaucracy. It needs to have the standardization in its procedures, high decentralization and requires high differentiation, especially vertical differentiation. The business plan and strategic plan should be developed in order to keep track of the organization operation on achieving the desired objectives. Furthermore, the leader requires appreciating the staffs more and establishing the training program. In conclusion, with all the changes in its structure and management style of the leader, One.Tel may be able to solve its problems and do more expansion.

Bibliography
Cook, T., 2001, Collapse of Australia’s fourth largest Telco adds to growing list of corporate failures, International Committee of the Fourth International (ICFI), < http://www.wsws.org/articles/2001/jun2001/onte-j08.shtml>
Five base of power, 2004, Power and Politics, viewed 12 October 2007,
Organisation Structure, 2003, Bnet, Viewed 5 October 2007,
Organisational Structure, 2003, Bnet, viewed 10 October 2007,
Robbins, S.P & Barnwell, N., 2006, Organizational Theory: Concepts and Cases, 5th edn., Pearson Education Australia.
Schmidt, T., 2006, A Review of Structure in Fives; Designing Effective Organisations, viewed 14 October 2007,
Return to 123HelpMe.com