Essay On Critical Case Analysis Of The Vodafone Strategic Integration Of Ethics In Its Corporate Affairs

Executive Summary

This report examines the elements and aspects of the integration of ethics in Vodafone and how it has affected and influenced the firm’s organisational culture, organisational structure and performance. The report critiques the elements of stakeholder engagement and sensitivity on Vodafone’s organisational structures and this identifies how the new elements of ethics influence the firm’s functional units.
The report also examines how the culture of Vodafone has changed after it introduced ethics. This includes the way they carry out their profit-oriented goals as well as the attainment of employment goals and other targets. This includes a review and analysis of how they carry out affairs and achieve efficiency through better and enhanced organisational and company performance and activities.
Finally, the report compares Vodafone’s organisational culture with the cultures and systems of some firms in the industry including BP and BT. This culminates identifying the differences and similarities between the new Vodafone and these entities. The last part discusses performance and how the culture of Vodafone has affected the performance of the firm and other relevant factors that determines performance.

Introduction

This report examines important elements and aspects of the organisational structures and settings of Vodafone. It reviews a case study and analyses the important elements and aspects of the case in order to come up with important observations and findings that complements the scenario and its features and aspects
The scope of this report will include the critical and thorough evaluation and analysis of the organisational structures which will include the assessment of the different functional units and the divisions. This will be evaluated in relation to their impacts on the performance on Vodafone. Also, the cultural structures will be critiqued in the absolute and relativist sense. This will cover the absolute elements of the culture and how it compares to other organisations that are of the same nature as Vodafone. Finally, the impacts of all these organisational and cultural matters on individual performance will be evaluated and assessed in the last part of the paper. This will be followed by a set of recommendations on how to improve organisational structures, redo the cultural systems and gain the best individual and collective performance.

A. Organisational Structures

Organisational structure refers to the way and manner through which power devolves from the top of an organisation to the lower ranks. Organisational structures also set up the essential elements of how control and authority relationships are established in a given organisation. In the case at hand, it is not apparent how the power structures of Vodafone evolve and how they are distributed.
However, it is apparent that the management of Vodafone have adopted a strategy that involves the integration of economic, social and environmental responsibility. This includes a process through which the code of conduct could be defined and monitored throughout the ranks and file of the organisation.
The strategy involves the integration of ethics and stakeholder sensitivity to all of the units of Vodafone. This shows that there are obligations and responsibilities that define the way things are done in different stages. This includes the activities of all heads and units of the strategic business units (SBUs). This is because the plan is to transpose the standards of responsible stakeholder engagement to all the tactical units of the firm.

A-1 Multi-Functional/Divisional Functions

The approach is to integrate honesty, corporate social responsibility and other matters to all the structures and units of Vodafone. Therefore, there are various units of Vodafone that are meant to be more sensitive and provide various levels of contribution to the corporate effort of becoming responsible and honest.
The functional units are all to integrate elements of honesty, transparency and stakeholder-sensitivity. This means that they all have to work with the overall plan of Vodafone and this is to be drawn and redrawn each year to provide guidance. Each strategic business unit will have to coordinate its affairs in such a way that elements of social and environmental significance have to be considered and reported in order to help the management of Vodafone to monitor affairs in these units. They will also have to deal with important things and some units have been tasked with specific obligations. This includes:

Marketing: Consumer-friendly activities

Communication: Transparency and honesty
Human Resource: Employment and training of socially conscious and environmentally matured individuals who will take up various roles in the organisation

Production: Integration of environmental and social values meant to complement the needs for social development

A-2 Structures and Performance of Vodafone
Obviously, these new structures will have immediate costs. There will be new systems that will be set up as well as numerous sacrifices that will be recorded as expenses. This is because it appears Vodafone was operating on the level of serving shareholders. However, it appears they want to satisfy other stakeholders. Stakeholders are “entities that affect and are affected by the activities of an organisation”.
This means that expanding the scope of affairs to please these persons and groups will have an impact on Vodafone’s profits in the short-run. However, in the long-run, the performance of Vodafone is likely to increase because stakeholder sensitivity causes trust and reputation enhancement. This in turn increases sales. Therefore, the new structures are going to improve performance of Vodafone in the long-run.

B Cultural Structures and Systems

Organisational culture is defined as the relatively stable actions and processes that guide the conduct of members of an organisation. The culture of Vodafone has gone through an overhaul and an evolution from being a purely profit-oriented entity to a socially-responsible entity that seeks to also maximise its earning potential.
The culture of Vodafone is one that seeks to achieve its profitability by moving from just making products and dumping it on the markets to one in which there is a stakeholder-sensitivity and respect for economic and social standards and targets. Therefore, the culture that has come to place includes:

The utilisation of transformational leadership structures and systems to get workers to become more committed;

Provide the best of services to employees beyond their salaries including training and bonuses in order to get them to become more committed to the firm’s goals;

Contribution to easing the social needs of local communities and societies Vodafone operates;

Monitoring and actively reducing environmental footprints;
Provision of consumers’ best needs;
Protecting and enhancing the reputation of the firm;
Providing high quality communication services to clients that goes beyond the normal and investment in research and innovation to enhance consumer experiences
The culture of Vodafone can be considered to be related to long-term and stakeholder-sensitive goals and activities. Therefore, the culture is one in which all units and all components of Vodafone are tasked with the integration of the best needs and the best expectations of all stakeholders including those within and outside the firm before they take actions. This culminates in various actions and a process within which there are the following rituals and activities:

Proper record-keeping and proper reporting in order to promote and enhance the organisational profile;

Leadership in corporate social responsibility and environmental matters and issues.
Market led innovation and the improvement of activities through the integration of consumer needs
Recruitment of the best and most matured people in terms of corporate social responsibility
Cost cutting and the achievement of economies of scale and control;
Continuous improvement and the achievement of the best levels of activities in order to enhance performance.
These two have therefore caused all the units of the organisation to remain focused on honest reporting as well as responsible activities. These principles constitute the main activities and processes that members of the firm have to carry out in order to be considered appropriately responsible in their activities and processes.
C Vodafone’s Culture
A new organisational culture is steeped in the need to unfreeze old practices and integrate new practices. The old system of cutting costs and satisfying the best and the highest needs of their firm is put aside and in lieu of that, a new system that is based on consumers’ best needs and requirements has been instituted.
As identified above, the new organisational culture is fundamentally steeped in a three-point vision which includes economic, social and environmental matters that defines the activities and processes of carrying out affairs. This stakeholder-orientation has led to cost cutting, responsible energy usage, performance enhancement, record keeping and reporting, and reputation enhancement and modification.
There are some corporate entities in the UK that are on the same level and at teh same point of Vodafone that have different visions and activities. They include some elements and some aspects that guide the way and manner through which they carry out their affairs.

C-1 Organisational cultures of Similar Firms

British Telecom, and BP are also elements that are at the same level of Vodafone in terms of sales and asset base. These are different entities and organisations that have various values and cultures that are somewhat different.

BT Group

The BT Group, formerly British Telecom had to make changes and adjustments to its activities and culture in order to survive the competition in the telecom industry as the diversification and liberalisation of the UK economy. The main values that it integrated that define its culture include:

Long-term commitment to sustainability;

Reducing the impacts of BT’s activities on the environment;
Reduce the costs that consumers have to incur for high-quality telecommunication services
This includes a number of activities that were meant to move the company to one that holds environmental and sustainability matters sacred and vital. There are elements that were meant to promote sustainability and enhance the way and manner through which BT operates and also reduce cost incurred by consumers. The need to reduce costs is steeped in the tradition of the firm as a cost leader when it was under government control.
BT and Vodafone seem to have numerous activities and processes in common. And this includes various processes and long-term commitments for sustainable results and activities. Again, their requirement to reduce their environmental footprints is remarkable. The area where they depart and are different from Vodafone is in the aspect of cutting down cost on the basis of their tradition of cost leadership.
BP
In the past couple of years, BP came under the spotlight for being negligent after it came under the spotlight after a number of accidents that involved its activities and affairs. This led to major matters and situations that culminated in different solutions and activities. The organisational culture included:

Production and protection policy

Reliance on cost-cutting and the achievement of maximum and optimal profits
Independent unit management and autonomy of various components
Autonomous chains of commands and uncoordinated activities over the units
BP focused on the protection of various production activities only. Due to this, they sought to cut down on their safety budget and also prevent incurring too much money in order to attain the highest profits. This culminated in various cuts that were dangerous in some health and safety elements that was responsible for some of BP’s worst accidents
Secondly, the units were not given the right protection and supervision. As compared to the activities of Vodafone, BP did not have an organisationwide policy and system that was implemented strictly. Different units were able to carry out activities they deemed fit. This culminated in numerous accidents and matters that led to problems and issues.
D Culture and Performance
Vodafone’s culture has a direct impact on the activities of employees. This is because every single employee is to carry out his or her activities within the framework of social and environmental responsibility as well as stakeholder sensitivity. Due to this, decisions are of a longer-term horizon and they are meant to lead to better performance over the longer-term of the firm’s activities and processes.
Secondly, performance is to be monitored for all the three standards – economic, social and environment. Therefore, people are expected to continuously improve in these areas and this will culminate in individually competent behaviours and activities. The main end and the main goal of this is to ensure that all workers are of a significantly high level of performance and this will lead to better standards of delivery.
Thirdly, the new arrangements have focused significantly on the integration of workers through the provision of various activities and processes. This is likely to lead to better and enhanced activities and prospects. This is because workers are treated to a higher level of transformational leadership and they are more motivated. Therefore, they are ready to sacrifice towards the long-term improvement and enhancement of Vodafone and its reputation.

Conclusion

This study deduces that the organisational structure of Vodafone is one in which there are organisational structures in which power is distributed on the basis of achieving new standards and levels in the area of economic, social and environmental targets. This is because the standards of firms and the organisation are now based on a long-term horizon and also on the needs of various stakeholders, not just shareholders and profitability.
Stakeholder engagement, consumer satisfaction and the need to avoid reputational risks and inefficiencies drive the culture and systems of Vodafone. This is because Vodafone seeks to achieve a responsible organisational culture that is responsive to the needs of various stakeholders in the firm. There are numerous elements and aspects of the firm that have been identified to have changed significantly due to the changes in the organisational structures and systems.
The study also examined similar firms and their connection to corporate social responsibility. It was identified that BT, a direct competitor to Vodafone was able to achieve similar sustainability and environmental goals as Vodafone. However, they focused on cost leadership as opposed to Vodafone’s focus on communication leadership and corporate social responsibility leadership. On the other hand, when compared to BP, it was identified that BP made some mistakes and poor choices that led to poor and less attractive results in the area of corporate social responsibility. This includes a focus on profitability and short-termism. BP also failed to have an organisationwide strategy for social and environmental safety standards like Vodafone and this culminated in major accidents that affected its reputation.
The culture of Vodafone enhances performance because it includes employees in its standards and expectations. Vodafone’s culture includes enhancing the motivation of employees and getting them to adapt to a transformational leadership system that they feel a part of.

References

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Bibliography
Business Case Studies, Developing and Implementing a Strategic Approach to Ethics [Online] Available at: http://businesscasestudies.co.uk/vodafone/developing-and-implementing-a-strategic-approach-to-ethics/introduction.html#axzz3TT6aX8Z2 Retrieved: March 4, 2015