Organizational Diagnosis Company X, a Medium Size

Organizational Diagnosis

Company X, a medium size manufacturing firm in the United States, joined the outsourcing and offshoring bandwagon several years back when the a major percentage of the company's production facilities where moved to China. Like most American companies that engage in outsourcing and offshoring majority of their business processes, Company X also adhered to "the build-operate-transfer model, [where the] the ultimate goal was to take ownership of the offshore operation to reap the cost-savings associated with eliminating the vendor middle man (Overby, 2009). The company has been successful in this regard and when they initiated outsourcing and offshoring initiatives, in 2003, the company was able to gain full control of the offshore operations after only four years. Thereafter, the company also set-up a local service and support center to handle inquiries and concerns from their Southeast Asian clients. The service and support center was doing well until late last year when employee turnover was high and the replacement personnel have had problems with the operations of the business unit. I was asked to evaluate the situation and determine the problem regarding the personnel particular their inability to meet work standards.

During a one-week analysis phase when the initial organizational diagnosis is being undertaken, the personnel at the service and support center were immediately apprehensive. Their mindset was that they were being audited and that I was trying to locate the flaws in their operations. I had to convince the personnel that what I was doing was "collecting data during organizational diagnosis that can serve to motivate organizational members to learn about and participate in the change process (Leadersphere, Inc., 2009)." I explained to them that based on the last quarter 2010 and first quarter 2011 performance reports, the personnel of the business unit were not meeting standards and several customers have complained that they were not getting the proper service and support they required. Thus, I reiterated that I was not performing an audit but an organizational diagnosis, "the purpose of which is to establish the widely shared understanding of the system and, based on that understanding, to determine whether change is desirable (Alderfer, 1980, p. 459)." To mitigate an already tense situation, I explained to the personnel that since majority of them have only been in the center for less than a year, it will take some time for them to get up to speed and I was there to facilitate their being able to perform better.

What I have come up with is that the personnel are all well qualified to do their jobs and have the requisite backgrounds and experiences to perform their duties and responsibilities. They have all had the four-week intensive training and one-week familiarization walkthrough prior to being allowed to independently perform their tasks. Nonetheless, I found out that there are competing organizations in the same line as Company X and who also have service and support centers in China. Some of the competitors are where the previous employees have moved to and one of the reasons for their transfer was better pay and more benefits. Thus, this is one of the problems that Company X is facing and if not resolved, the company may lose their present staff to the competition if they cannot provide at par pay and benefits. In addition, the training provided to the service and support center personnel is concentrated on the technical aspect of their jobs such as how to handle replacement parts, answer customer queries on the parts, etc. What they lack is competitive intelligence training whereby they will know how the competitors are doing with their service and support center that improve the service they provide to customers. In the interviews with two supervisors, they said the company should provide training and information on what are the innovations being made by the competitors with regards to their service centers. This will help them develop ways outperform the competitors and increase customer base.

Based on the above, two changes will need to be made by Company X; the first is to revisit the pay and compensation package in order to align them with industry standards or even give a better one. The second is to develop a training program along the lines of competitive and business intelligence. One of the resulting outputs after the training is for Company X's marketing and strategic planning departments to provide the competitor information that will help the local staff improve their customer service functions. Company X's human resources department agreed to re-evaluate the pay and benefits package and come up with options that will be negotiated with the service and support personnel staff. HR does not see any resistance to this because they have committed to provide an excellent package considering the company has been doing well with their China operations.

As to the business and competitive intelligence initiative, a plan will need to be developed and approved by top management before it is fully implemented. The design and development phase alone will take several months since a thorough study of the local market and competition will need to be done. Change management endeavors will need to come into the picture and the initial action is to "set clearly defined and measurable objectives. Goal setting if done well engages stakeholders and commits them to the program. Other benefits include focusing effort to where it is important and providing a yardstick for measuring program success. (Business Performance Pty Ltd., 2010)." Since Company X's have already approved "in principle" the training and change management initiatives, I spent another week with the service and support personnel to gain their inputs such as their expectations, how they can contribute to the success of the endeavors, any resistance to the changes that will occur, and should the training and change conclude, the performance measures that need to be in place to see how they are doing.