I want to bring my readers into the core of a Six Sigma implementation processed in Jordan, and would like to point them to a new success story from Jordan, the talk about Jordan Telecommunication Corporation, which later became a company, it was a Governmental department established more than many decades ago, the corporation has a comprehensive Infrastructure in the Communication field, since it is the only provider for all communications services; the corporation was incapable to cope with the great ever-increasing demand for its services.
The waiting time for household telephone lines was consequently extended to several years, also for business, many business institutions were enforced to wait for several years, one of my friends has opened a shop in Marka-North a suburb of Amman in 1984, but he discovered that he has to wait for unlimited time but after he spends a lot of money, he was lucky and got a line after waiting for 5 years, by that time he really had came to broke, thus shop was closed one year later.
Government nominated board of directors, a General Manager, and some assistants managed the corporation, there were no planning except some tables done by the General Manager assistants and sometimes technical drawing and or charts made upon their own sense of feeling, these in better cases, were seen by some of General Manager Assistants and colleagues. The corporation was run on reaction strategy bases, I mean that when a problem happens, they start searching for a solution, since they weren’t qualified, authorized, thus finding no solution was the real case, but when they sometimes find a solution, then they need to take a decision, which will take another 2-3 years, and some times to put it in action a plan might need the same period of time and to implement it the need another 2-3 years, during this time many other problems will be dominated.
The corporation was run on daily basis, there were no marketing efforts, the management philosophy in act was that: “keep things running with little claims”, the management wasn’t doing any customer’s services except that little number of lines were allocated for services, there were no policy that cares with customers, instead the policy was caring to eliminate complaints, great efforts were exerted, but all was personal efforts, indicating personal diligence, and there was no similarity in forms and in processes applied in different sections and offices, in addition to a long march of routine signatures and multi documented processes. Even when a client needs to pay a bill, it was like a hill day, he might spend 1-3 hours just waiting on line.
Tariffs were cheap, (in comparison with current prices), many services were provided for free, but some tariffs were of high profit margin, especially International calls thus the corporation financial statements were in most cases shows deficit (especially when they have some extensions projects), thus the corporation was in endless shortage of funds.
Although services were acceptable from technical point of view, but that only applied when it’s was available, this means technically the services were good and appreciated, but from managerial and economical feasibility it wasn’t to that limit of goodness.
Briefly says:
From the customer’s point of view, to deal with JTC, or even to visit their offices was not a good experience, if it is not the worst one.
From the Government view, it was a suction pipe of funds, while from the technical point of view; it was great personal efforts, which shows distinct.
The Jordan Telecommunication, thus was a managerial crises for the Government
To cope with worldwide new telecommunication development associated with Information Technology, the government decided on privatization, but at this point it wasn’t promising, since there are deficits in balance sheet and financial statements, Accordingly a five year plan was adopted this will make:
1- The corporation was changed to a Government owned company.
2- To improve the company earnings, this profitability, which makes it more seek able by key service providers.
3- Improving earnings will automatically mean improving the sale price of the corporation.
4- A gradual rate increase strategy has been adopted for 3 years, (as I remember), where rates were increased and units of services have been divided into smaller time units to maintain higher income for the corporation. Free services have been subject to gradual limitation, thus there were no free services after implementing the five years plan.
By the end of the five-year plan, revenues were around 240 million Dinars/year, while the company was sold for around 640 million Dinar, which I believe is a very cheap price, while its assets merely was valuated for around 190 million Dinars.
A consortium of Arab Bank and the French Telecom, has bought the company, in addition they got a license for providing SMS telephone services, under a private brand name Mobilecom.
The new management adopted a new strategy that’s entails:
q To remove the old image of the corporation from clients minds,
q Introduce a younger, fast growing organization, as a reliable partner service provider.
q Concentration has been made on corporate partnership and customer’s relation’s strategies.
The corporation was changed to a company, which was subject to a complete organizational restructuring process, which entails the followings: (The reasons for restructuring):
1- Stake holder’s interest, since they employed a lot of money in these projects, and they need in return suitable profits.
2- To cope with public demand for services, for a wide range of services became needed and there must be a reliable service provider.
3- To change the image of the company in people’s minds, thus creating a successful organization’s image.
To do the restructuring in the right manner, it was important to decide for complete reengineering, thus the officers acknowledged and adopted the following strategies:
1- All or merely 80% of the employees were subject to new trainings.
2- Paper works and signatures have been greatly eliminated and merely dismissed and removed.
3- Paying great attention for existing clients and customers, considering them as Loyal Strategic Partners, instead of annoying customers.
This great shift was achieved through the followings:
1- Company has gone under reengineering process, where the processes and signatures in each department and section has been studied, and eliminated.
2- Employees has gone under comprehensive training, where many employees has been shifted to other jobs, keeping only all those employees who fulfill the standard requirements of performing the job, thus increasing the productivity of the employees and the company.
3- Customers service was shifted to top priority,
4- New software has been developed and implemented to eliminate paper and signature works,
5- A computerized net work has been set up and implemented to reduce time and speed communication between departments, thus it becomes of no need for moving documents from one place to another, and employees become instantly aware of the requested orders and jobs needed to be performed. This I believe was a great improvement in company procedures and operation processes.
6- One shop service strategy was adopted, client needs only to call for a single windows to get the service, which will consume only 2-3 minutes, while the follow up will done automatically, the other concerned departments will complete the required processes without need for the client attendance.
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7- All unnecessary sections were immerged into other section for emphasizing productivity.
8- Mainly, no new offices have been hired, instead, the company used a strategy of rehabilitations of the existing facilities, but renewed it and redecorates it, providing it with new setups that made and changed the client’s visit to a pleasure.
9- All office and service providing facilities has been reengineered to provide the maximum comfort of clients when calling to the company offices for any purpose.
10- All the above was associated with a huge advertising campaign to create the following effects:
The strategy of the company depends on four core dimensions,
1- Creating Awareness, demolishing the old image of the Government Corporation, they use Explicit, Implicit and Perceptual advertisement to show and create a new corporate image, the concentration was made on the followings:
A- New Face, New Procedures and Strategy/Service provider.
B- New Services and service dimension of new and creative services were introduced.
C- New Service Dimensions, all distribution points and switch gears has been checked and tested, and new instruments have been installed to maintain service provided in least time, new cable lines have been installed with higher and wider capacities, thus making extra capacity available at all times and in all cases.
D- Strategic Partnership, for several services has been introduced to the existing clients, in addition to attracting new clients, also long term partnerships were included and addresses.
2- Corporate Relationships, the new company finds it is worthy to concentrate on corporate relationships, thus maintaining close and cooperative relations with huge service providers of other ancillary and basic communication services, thus increasing the streams of revenues and new channels of services provided.
3- Customers Relationships, the company emphasizing on long-term relationship with its clients.
4- Also this process entails a lot of expenses, but it is obvious that these investments could be recovered within very few years, thus making the company ready to meet the challenges of the twenty one century, providing reliable and sufficient services to the country and the community, which will help attracting new investments, that are of great important for the Jordanian economy, for, it will be reflected in creating more jobs, enhancing the local and national industry and services, thus will in return increase exports and tourism.
The company is expected not to be the sole provider for Telephone, Telex, and other wide band and telecommunication services, within the next few months, thus it is ready to met new challenges. This was a successful process for the restructuring, and company reengineering.
Now lets discuss why this was happen with great success, I really want to disclose that I hated to being sold, in addition it was sold for a cheap price, ( as I believe), since it was hard to find an investor who will accept such a big risk, but it really happened, a success story from Jordan.
I believe that this success was possible, because the company concentrated on, developed and implemented a Stakeholders strategy that includes Owners, Clients, and Employees.
Lets examine, what might happen if the company has neglected its employees, it might be facing and subject to the worst scenario, but the company management was very clever and very professional in restructuring process and operations, because it mainly depends on it’s own employees, but since employees usually reject the new, (Just anything New), the company starts first with employees, making them its first core of restructuring, facilitating their job, providing a pleasant environment, suitable incentives and salary packages were introduced and implemented. This strategy, helps to win the employees support in a win-win mutual strategy, thus it was capable to win the challenges.
In view of the owners, the project seems to be very promising, for it might cover the reengineering costs and investments within few years. In addition, it has an extra spare capacity which will increase the profits of the company during the next coming few years, thus it cause the strategy to a win-win strategy, instead of the old one win-lose strategy which was adopted when the company was a governmental corporation.
In the other hand, the company has created a young organization, fast growing with unlimited possibilities of profits and success, for the coming years.
But, what about the clients, really they were the first who notice the success of the company, and that was through:
A- Waiting time for providing a new service has been dropped dramatically and decreased to the minimum, may be 2-3 days only.
B- New products have been made available, and provided mainly free with the services provided, i.e.. Modern telephone sets. etc.
C- Bill payments have become more easily and speedy, thus making the visit of the JTC a pleasure experience, instead of miserable one.
D- Offices has been rearranged and decorated to provide pleasant environment, thus it become easy to reach any service section without hassle.
E- Many new services have been introduced; accordingly the customers have noticed great changes in the operation and processes in all departments of the company.
F- The Tariffs of many International Calls and Internet has been reduced, to maintain the smoothly usage of the available capacities.
G- Maintaining coordination between all company departments, which entails in smooth running of operations and processes, which reflected on the benefits of the customers through dedicated customer’s care.
H- Clients become aware, loyal supporters defending the company activities, thus the company maintaining a long-term flow of profits.
Now, if we consider all these benefits, it will show that the problem was a managerial problem, in addition to what we cant neglect and we could call as technical challenges. Really technical challenges could be overcome by purchasing state-of- the-art know-how and technology, but for the managerial aspect, we would not be able to create a successful company from the remains of a governmental corporation, without being subject to a complete reengineering and restructuring of the new born company, being supported by the right will, to perform the right things in the right manner.
This could be a success story, from where and why, and how to create the success in business, believing that in the modern business, there are nothing left for chance, but the matter is simple as it says, If there is a will, there is a way.
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References:
- This Article was a lecture on: How to create The Corporate Success, A lecture of practical experience and close case study, by Dr. Wasfi M. Abdo, founder of: (AISU-American International Schools and University,) an Independent Management & Finance Consultant, Leader’s Coacher, who’s main interest field are Corporate Emerging and Reengineering.
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