Telstra Company: Business Environment and Strategy - Case Study Example

Remuneration and performance Student’s Name Subject Professor University/Institution Location Date Executive Summary Telstra is a telecommunication company with a long history of serving people by offering services and sale of products. Telstra corporate responsibility is based on the vision to connect with people, customers, suppliers, and communities in an accessible, environmentally sound and healthy way. Its operations combine workplace, marketplace, community and environment matters as core to its functions. This is meant to benefit individual, communities and national growth and ensuring that benefits are shared across the organization. Established upon corporate responsibility, Telstra carries out regular and continuous evaluation and review their performance. The goals for this are to enhance their delivery to customers and their shareholders to make good business sense. It also helps Telstra become more efficient, improve their employees pride and ultimately increase productivity. Telstra transformations focus to impact on their new services, products and solutions on Australians and the environment. User protection is promoted by enhancing security and privacy. Continuous information to customers on is maintained to help them access information. Aiming at world class service, Telstra requires world class workforce. This determines how the immensely invest in training the people so that they can operate, build and maintain their networks and to serve their customers better. They are oriented on continuous improvement and thus future actions will progress and integrate corporate responsibility in the way of business. Introduction and Organization Overview Telstra Corporation Limited is Telecommunications and Media Company in Australia. It deals with building and operations of telecommunications networks, marketing mobile, internet access, television products and services and voice. It was fully privatized in 2006 and currently on change program for sales and marketing. Further structural changes on the company are being driven by its mass adoption of internet and federal government’s NBN (National Broadband Network) agenda. It owns the fixed line network for telephone, data cable networks and a competing pay TV. It trades under Telstra brand both internationally and domestically. Since 1990 it competes with Optus which is Australian second largest communication company and other small providers. Telstra products and services include the mobile and fixed lines, mobile networks, internet and wholesale products like data, voice, mobile and many other facilities to other companies for resale. Telstra owns and operates a series of retail stores known as Telstra Stores, owned by Telstra Corporation and Sensis for directories, advertising and managing several websites. Major developments have been undertaken by Telstra, particularly in the last decade after it was fully privatized. This is through implementing change programs in operation, and functionality. To deliver, in the diverse programs, Telstra has managed its workforce. An important consideration of its performance management, operations and remuneration system reveals intrinsic strengths for its success. 1. Telstra business environment, business strategy, and other significant factors that demand strong support from the performance / compensation system. Important aspects of Telstra beget a strong support from performance/ compensation system. Telstra business environment is based on domestic and internationally operations. Telstra is the largest telecommunication company in Australia It deals with widespread products and services including fixed lines, mobile, mobile networks, internet (Telstra Internet, Wholesale, and BigPond), shops, subscription television, advertising (Sensis) and directories. Their international expansion include operations in Europe from 1992 with a customer base of 7000 customers buying data, voice, hosting services and network, telecommunications in New Zealand as third largest provider, Japan and Singapore. Other partly owned and operated international operations include the Reach Asian cable, SouFun, CSL New World Group, Northstar Media and Telstra Endeavor among others. Telstra business strategy involves core competences such as providing consumer benefits and leveraging widely to a larger market and many products. They have also built a strong culture that focus on customer services key for cost cutting. Their differences with their domestic competitors’ spring by the way they offer various services and provide facilities for resale for its competitors. Telstra strategy in offering lower telecommunications services rates at some routes and times of the day. It has not only based on historical voice and private data, but also extended newer markets for Internet Access, Colocation services and Hosting. It has also been favored to use the telephone lines for the fixed telephone services. Telstra has undergone changes for a description of its competing industry; sales and marketing. They have also launched a set of initiatives in marketing, information, operations, technology and organizational development. Finally their long term financial plan has forecasted results expected from their plans and a strategy to meet stakeholder’s requirements. Other significant factors critical for their operation a completion has been launched forum 2010. Among them is the market recovery a $ 1b as an effort to win back the market share of key product and which paid off strong sales momentum. The customer service recovery was a 2011 new strategy whose goal was to offer customer services as a fundamental part of the organization. Consequently, TIO complaints dropped by 3%. In 2011 Telstra aimed to improve the usage of digital channels in customer services. Telstra Digital then developed mobile phones electronic bills payment launched a homepage design, Crowd Support which is an online forum for customer services. In 2011 Telstra aimed to create 100 additional retail stores a three year project. In October 2011 they launched new brand identity with color scheme. Finally they have devised ideas for National Broadband Network which sells copper network. Such considerations make Telstra demand strong support from the performance / compensation system over its directors, managers supporting staff, outsourced experts and consultants.  2. Telstra requirements, in general and in specifics, to a good performance management system. Telstra operations are diverse and dynamic which requires a comprehensive performance management system. Its effectiveness reveals significant applications of actions for the success of its goals. However, in considerations of its geographical operations, widespread services and products and high population of its customers the following would be significant requirements. One of the requirements is to develop an employee performance plans and clear job descriptions. This determines the key result areas for instance their sales and marketing and performance indicator such as customer size, new areas of operations and increased profits. Second, as a technological developing company, it needs to select the right set of people through an implemented appropriate selection process. Thirdly, need to establish performance standards and negotiating requirements to measure overall productivity and outcome against predefined benchmarks. Fourth, provide a continuous feedback and coaching during delivery of performance. Other applicable actions for performance management may include needs for training and development, holding quarterly performance discussions, designing an effective compensation system, promotional and career development and performing exit interviews to assess their employee discontentment (Performance Management 2006). 3. Description and analysis of Telstra performance management system People and performance management is enhanced by developing performance objectives for each employee and aligning to companies objectives. Telstra performance review process has two informal quarterly reviews. A formal review carried as an annual and half- yearly review that target leadership and business results. Each of Telstra business unit has a rewarding and a recognition schemes that encourage top performers. Telstra has various incentive plans for different segments of their workforce. These encourage high performance as they reward employees who meet and exceed performance objectives. Through report and benchmarking performance, Telstra continually work to improve the corporate responsibility performance. External survey and reports helps then benchmark performance and identifying the areas to be improved every year. Since they are on the largest Australian employer company, the diverse workforce are provided rewarded and provided with fair, safe workplace to reach their potential and get empowered to provide customers with great services. Their approach is based on cultural priorities to deliver the company’s vision, such as Customer First, Compete Win, People Power, We Get It Now, Done Now, and Anything Possible. Employee Engagement is gauged through internal surveys for feedback about its operations and operation environment. Regular communication with their employees is done via team meetings, company intranet and emails. This provides relevant and up-to-date information of the going on and the way they can enhance their contribution. Telstra requirements for a good performance management system are needed to for creating an effective workforce in the company. There are different processes that Telstra combine for its effectiveness. Telstra is building on a core objective of employee delivery. As Ross (2009) observes, due to deregulations of Australian telecommunications industry they have changed their employment relations. Key among them is large-scale downsizing with strong outsourcing. Individual employment contracts are in favor than collective bargaining. Performance management in domestic and internationally activities of Telstra develop through planning, monitoring and rewards. The planning strategy is founded strongly on recruitment based on contract employment. A rigorous monitoring process which involves close survey of its various departments and individuals is employed and is vital in management to reach their goals. Their rewarding systems are meant for rewarding the employees with public recognition and actual monetary rewards. Having in mind that they are a telecommunication services company whose development is in the verge of innovations and inventions, such a rewarding system improves the morale of the employees, satisfaction, boost productivity and moving closer to the goals. This is done through their sales performance management and incentive compensation solution provider named Varicent software that effectively manage, analyze and model various incentive payments of the company, government sales divisions across retailers, finance service providers and telcos (Osman, 2012). It formulates plans; closely monitor progress, track and managing rewards. Telstra has been committed to manage risks to acceptable levels. By this, they maximize their opportunities and minimize the negative outcomes. 4. Evaluate the system Telstra system immensely supports the concept and theory of performance. Telstra performance management system is built on organizational inputs, setting expectations, supporting performance and reviewing performance. Learning and development are integrated and planned with the performance management cycle. They are also reviewed regularly and primarily relate to job through formal training. E-learning and online learning portal has influenced Telstra’s leadership management and development. Through the above actions and strategies, this is manifested. The system also link to organizational goals and strategy. Through the employee benefits arrangement and work provision makes Telstra attract and retain best people. Particularly they promote employee growth through an enabled reward that fosters employee commitment. By this they ensure that their great products, services, technology, great resources and people are capable to meet the current and the future business needs. The practice has been made efficient through the control the application of continuous evaluation, employment of efficient technological programs like Varicent and carrying out operation in business units. Their educative approach is diversified and effectiveness. Through their workplace matters they hold dear and important their employees, training and education, diversity and opportunity, health and safety matters. In marketplace matters they look on their customers, products and services, suppliers, competition and pricing matters. Efficiency is promoted through employment arrangement in both full-time, and flexible work arrangements including art-time, supplementary worker and casual. A flexible workplace should focus on employee wellbeing and balance in work life. The company’s results are benchmarked against the global and Australian norms to enable it track performance. The specific communication for managers is done through ‘The People Manager’ internal publication. Telstra employee benefits are based on choice and flexibility. Its remuneration package is a competitive and attractive for all employees at and above the minimal legal requirements. This is done by comparing their remuneration with against the relevant market data. Annual remuneration for contract staff is set and increased by use of the industry trends and economic data. Telstra Enterprise Agreement provides an attractive competitive remuneration. The focus is on payment for performance, emphasizing rewarding the high productivity, appropriate behavior, and teamwork and business results. Telstra benefit program for employees named MyRewards@Telstra is comprehensive and integrated as a program that delivers tangible benefits, both non-financial and financial to employee beyond the remuneration. These benefits are discounted products, services, discounted health, fitness services and financial services. Through Telstra Jobs Program is funded to assist retrenched employees for their career management skills to assist them find a suitable employment with them or outside the company. Life & Career Transition program for contract employees facilitates transitions for them to offer access to flexible options. This offers transition support, expert case, extended and immediate family management. Employee Assistance Program (EAP) enhances employees and corporation wellbeing. It also offers professional counseling, advisory services through independent company staff of qualified social workers and psychologists. The services are funded by Telstra free of charge (Telstra 2010). Workplace relations are maintained by solving workplace issues fairly and quickly through Telstra’s Internal Resolution Policy. Employees rights are treated well and actions and decisions that impact them are also scrutinized. Telstra various Dispute Resolution and Avoidance Process is agreed with unions. It also respects individual’s rights as trade unions members without discriminating against employees due to political affiliations and beliefs (Telstra Corporate Responsibility Report 2005/06, 2006). 5. Propose improvements to the system. Telstra need to promote open work system. Their developing efficiency and technology should promote free working conditions which allow workers to choose to work at their own convenient place, time and place. This mainly reduces can reduce Telstra cost of laying down infrastructure such as offices and working locations. The open work will provide diverse employees contact, and retention working at multiple time zones. This is important since their telecommunications services are required by their customers around the clock. All the choices to their employees should be provided either to function within the workplaces location, home or for both alternatives depending on demands. This also creates flexible work schedules, with better structures for the balance of professional and social life activities for their employees. By providing the right technologies, tools, and support processes, their global employees can work at anyplace, time and with available technology efficient with them. Thus a percentage of their employees working at their convenient location would increase open work adoption and participating to critically implement the program. Open work program ultimately reduce the need of real estate holdings by a larger percentage leading to saving of much money. It also reduces operating costs resulting and promoting eco-responsible systems through environmental matters of green approach to much business idea today. This also enhances customer satisfaction and builds strong productivity. Another aspect that Telstra management should deal with is to offer training for their home-based managers and employees by providing resources. The system needs a clear defined selection criterion for internal and external recruitment strategy. This promote candidates self assessment, evaluation and dynamism. They also require a clear defined performance and appraisal measure. As customer Service Company, they need to set the elements to identify a competitive training that include teamwork, interpersonal skills, language proficiency, self-drive and evaluation. Telstra should provide both short-term and long-term employees and company’s strategic objectives. The employees can be engaged in an active mentoring and monitoring. This is to provide assistance before, during and after selection core to get the employees attitudes interests and behavior incorporation in the business. Training should also be based on a long-range plan and its outcomes and effectiveness need to be stretched for a specified duration so that they can avoid haste and premature evaluation. Training should be balanced and wholesome in professional, social, and cultural aspects and sensitive to contract duration. Telstra Chief Executive Officer need to develop a global team for the company’s working regions. Thus, it can remain closer to the customers; tap great talent and other services around the world. The diverse and dispersed team helps in understanding and responding to customer needs in an appropriate manner. Each team can be structured in management applying rule across supervisory functions to create balance and gain effective feedback. Telstra online policy for its management teams should enhance their global team take over projects appropriately and scheduled weekly conference and calls to keep the team together. The team discussions with individual and group consultation therefore reach decision effectively and utilize ideas of various people. 6. Contingency factors to take into account to ensure that the system is dynamic to suit strategy and changing environments Ensure aligninment and continuous evaluation of organizational inputs. This pertains to vision, mission, core strategies, values, and goals. It is an effective way for ensuring measurement, evaluation and consideration of improvements and alternatives. Telstra need to set continuous expectations through its purpose statements, core responsibilities, individual goals and measures. This significantly would improve communication which can be incorporated through published promotion information. A dynamic support performance can be promoted through feedback, coaching and counseling. This is critical for Telstra geographical distribution involving different political, cultural and social factors. Telstra system of reviewing performance through reward, recognition and compensation need to be formalized. This is to ensure stability and reduce conflicts that may rise from informal system prone to be manipulated. 7. Compatible compensation and reward system that should be introduced, to support the smooth functioning of the performance management system According to Summers, (2004) observations, Telstra would require a formal and legal established compensation and reward system. It should define and plan different categories to apply standards across the organization’s employees. Profit-sharing should be employed as a rewarding for workers contribution. As Telstra grows rapidly, employees involved in achieving corporate goals primarily own its success. The degree of Telstra profit-sharing should be dictated by its annual operating profits. Employees who have shares in the company should be given significant rise of their share value. Telstra need to establish a direct insurance plan for employees for its employees to tap its many advantages. It should be set as one-off payment or a monthly contribution which should be rewarded with annual supplementary payment. Telstra pensions help its employees plan for their tomorrow depending on their specific national arrangement. However, employees’ retirement plan should be entirely funded by Telstra. It requires applying modifications of the system to maximize effectiveness with the changing company’s operations. To take care of their employees, they can have a strong accident insurance valid in all areas of their operations. Employees should not just be insured when working but all the day for the whole year. Insurance claims need to be attended fast and include employees relative as eligible for insurance. Telstra should have a compensatory time account open to all its employees. Contributions, vocational money or salary portions should be made and at the right time of withdrawal employees can therefore fund their educational goals or use the money for early retirement. In conclusion remuneration and performance are intertwined in every business operation aiming to motivate its workforce. Without considering people as an important power behind business operations, great products, services, technology and processes would fail to be as effective and profitable as possible. Remuneration and performance is therefore, both a theoretical and practical applicable sense whose exercise promotes great exercise of workforce potential. A contemporary and more productive workplace relations approach build on fairness and trust, understanding the commercial objectives, internal resolution and coherence issues and values are important to achieve productivity from workers. References Osman, H. 2012, February 24). Telstra adopts Varicent's sales performance management solution. Retrieved Noveber 6, 2012, from ARN: http://www.arnnet.com.au Performance Management, 2006. Review of Performance Improvement Models and Tools. Measurement, (January), p.1-45.  Ross, Peter (October 2009), "Strategic choices in pluralist and unitarist employment relations regimes: a study of Australian telecommunications", Industrial and Labor Relations Review 63 (1): 24–41 Summers, L., 2004. Executing Pay for Performance: Using Technology to Connect Compensation with Performance Management. Benefits Compensation Digest, 41(9), p.29.  Telstra , 2010. Annual Report 2010 (Report). Telstra. p. 4–5,10. Telstra, 2006. Corporate Responsibility Report 2005/06. Telstra. P, 1-47. Read More