Introduction The organization which I choose for the leading strategic change assignment is AT&T (American Telephone and

Telegraph Company) the history of AT&T is in large measure the history of the telephone in the United States. AT&T's roots stretch back to 1875, with founder Alexander Graham Bell's invention of the telephone. AT&T is a global company that provides communications services and products, as well as network equipment and customer systems, to businesses, consumers, telecommunications service providers and government agencies. An AT&T Bell laboratory engages in basic research as well as product and service development. AT&T also offers a general-purpose credit card and financial leasing services .AT&T people works in more than 120 countries. The change which I take for this assignment in AT&T was started in year 1996 and end at year 2000. Nature of the change. According to the De Wit and Meyer (2004) revolution is a process whereby an abrupt and radical change takes place within a short period of time .Revolutionary change processes are those that do not build on the status quo but overthrow it. Revolutionaries revolt against existing business system and organizational system, and attempt to push through changes that will reinvent the firm. Thus revolution leads to the clear break with the past a discontinuity in the firms development path. Such a big bang approach to strategic change is generally needed when organizational rigidity is so deeply rooted that smaller pushes do not bring the firm into movement .If the firm threatens to become paralyzed by these inherited rigidities in the business system and organizational system, the only way to get moving can be to radically break with the past. According to the Balogun and Hope Hailey (1999) the type of change that was undertaken by the AT&T was a revolutionary change that was triggered by US deregulation of the telecommunications and information services laws. The purpose of law was to promote competition between local telephone, long distance telephone and cable companies by establishing procedures for the elimination of legal and regulatory barriers between these industries. (See Appendix 1)

The consequences of the strategic drift was the change in political environment that is deregulation of US Telecommunication laws, by looking at the external environment, AT&T CEO Robert Allens on September 20, 1995, announced for the strategic restructuring of AT&T that starts from 1996 and finishes in 2000.This change would separate AT&T into three publicly traded, global companies. Over the next four years, AT&T took many actions to succeed in the changing environment. 1. Systems and Equipment Company (which became Lucent Technologies). 2. A computer company (NCR). 3. A communications services company (which would remain AT&T). The strategy that was chosen was a deliberate strategy and it was the largest deliberate break-up in the history of American business. Lucent became independent .on Sep 30, 1996. NCR followed on January 1, 1997 The new AT&T began evolving from a long distance company to an integrated voice and data communications company. AT&T worked to reenter the local telephone service business, as envisioned by the Telecommunications Act of 1996. A more proactive reason for instigating revolutionary change is to be the first firm to introduce a new product ,service or technology and to build up barriers to entry for the late movers .To know-how that is dissipation-sensitive ,or for which the patent period is limited ,it can be important to cash quickly before other arrive in the market (eg. Kessler and chakrabarthi, 1996; Lieberman and Montgomery, 1988, 1998). AT&T realized that as a result of this new law, the stand-alone long distance business was likely to decline. AT&T successfully launched an Internet service, AT&T WorldNet Service and takes a first mover advantage, while selling operations, such as AT&T Submarine Systems and Sky net Satellite Services that no longer were a strategic fit.

Change Management To transform AT&T from domestic long distance company to any distance, any service global company their mission was to enable people to communicate anywhere over any distance in any form. To manage this change process AT&T adopt the strategy of cost reduction, invest for growth for this they do strategic acquisition, merger, demergers, joint ventures, and implement future proof network architecture.

By listening to customers AT&T has defined their vision. Guided by their vision, their strategy was focused on three priorities. 1. 2. Achieve a Competitive cost position. Invest for growth in five areaslocal services, wireless services, Internet services, outsourcing and networking integration, and global markets. 3. Implement future-proof network architecture.

Achieve a competitive cost position AT&T reduce selling, general and administrative (SG&A). As a part of cost reduction strategy they change their organisation structure, in 1998 they reduce their 18,000 work force (Appendix 2). They also announced a monetary incentive like programme of voluntary early retirement for management employees. Invest for Growth The ultimate weapon in an organisations armoury for managing problematic competitive (and symbiotic ) interdependencies is merger with ,or takeover of , a competing organisation .Merger and acquisitions can improve a companys competitive position by allowing the company to strengthen and enlarge its domain and increase its ability to produce a wider range of products or services to better serve more customers. A joint venture is a strategic alliance among two or more organisations that agree to jointly establish and share the owner ship of a new business. AT&T investing for growth in five areas: wireless, local, Internet, AT&T Solutions and global services. Wireless they built 10 new digital wireless networks in 1997. During the change process from 1996 to 2000 for the growth AT&T `adopt the strategy of acquisitions, mergers and joint ventures In 1997, AT&T Digital Link was available to customers in 49 states for outbound calling. And their entry into the business local-services market will be vastly accelerated once their ending merger with TCG is finalized in the second half of 1998.

In 1998 AT&T signs a definitive merger agreement with TCI, the second largest cable company in the United States. In 1998, AT&T Network Services focused on growing the existing network, enhancing its reliability and improving unit-cost effectiveness they were continuing those efforts in 1999. In 1999 AT&T announces general availability of its local residential telephone service in New York with a bundled plan called "AT&T Local One Rate New York." This is AT&T's first general reentry into the consumer local telephone business since the break up of the Bell System. It occurs under the provisions of the Telecommunications Act of 1996.AT&T makes an unsolicited offer to acquire cable company Media One, which Media One accepts in 1999 and become the largest cable company in United States. They have finalized their joint venture with BT and launch global offers as they integrate the IBM network. Their purchase of the IBM Global Network extends the reach of their data networks to 81 countries. Now known as AT&T Global Network Services. Implement a Future-Proof Network Architecture. They are greatly boosting the capacity of their nearly 41,000 route miles of fiber installed in the United States through a new SONET (Synchronous Optical Network) photonics technology. The system increases the transmission capacity of their existing network by a factor of 10 without having to lay any additional fiber-optic cable. The involvement of members of the organisation in the strategy development process or the planned of strategic change is also ,in itself ,a means of communication and can be very effective .Those who are involved might be used to cascade in formation about the change programme into the organisation ,in effect becoming part of the change agency process themselves. To involve the people, Allen, CEO of the new AT&T chairs a committee of senior AT&T executives to oversee the restructuring. According to cultural web Allen change power structure of AT&T by appointing senior officers to lead the transition. Because introduction or new arrival of new management from outside the organisations can also increase the diversity of ideas,

views and assumptions which can help break down cultural barriers to change; and they may help increase the experience of the capability of change. (See Appendix 2) Involve people through out the organisation rather than just regarding them just as a recipient of change with restructuring of AT&T parallel HR transformation was achieved through by taking different measure, strategic HR processes were integrated with business planning within a continuous performance-improvement framework, or the performance management platform (PMP) as it is known, which is geared to helping business-unit and field-team partners to achieve their objectives. To manage the change process they have used different models where local AT&T managers and union officers develop new approaches to managing change at work. Routines are the organisationally specific ways we do things around here which tend to persist over time and guide peoples behaviour. It may be that an organisation which becomes especially good at carrying out its operations in particular ways achieves real competitive advantages .However ,well-established routines can also be serious blockages to change, as Dorothy Leonardbranton points out ,they can become core rigidities .To change the routines of the AT&T employees AT&T according to cultural web they made a Human resource leadership council which focus on changing behaviours with individuals and process teams, so it achieves two things: alignment of strategy with planning, and a constant emphasis on behavioural change linked with process, system and organizational-design change. (See Appendix 2) Invest in employees through education and personal support. In order to manage the change properly AT&T changes in the reward system of cultural web through non monetary incentives like reskilling, diversity, workforce demographics, leveraging employee involvement and competitive workforce strategies. (See Appendix 2). For the control management of AT&T to see that how these HR initiatives are working they check it through the corporations top-level business performance measures, like customer value added, people value added and financials.

In 1997 they launch a programme OWN IT a non monetary incentive in this programme through individual and team efforts, people from all over the company latched on to the concept of acting like owners of the business. Through this programme AT&T people are dedicated to finding and implementing the most efficient, cost-effective ways of doing business. It defines the policies and processes that every one can follow. AT&T CARES Program gives all AT&T people a paid workday in which they may volunteer in their local communities.

Nature of the leader ship employed in change The strategic change was initiated by the Robert E. Allen in September 20, 1995 who retired as chairman and CEO 1st November 1997 after almost a decade of leader ship. After Bob Allen, Michael Armstrong becomes the chairman and chief executive to lead the change. Robert E. Allen Robert E. Allen has been chairman and chief executive officer of AT&T since April 1988 .He joined Indiana Bell in 1957.He attended the Harvard Business School's Program for Management Development in 1965. In 1969, he became general commercial manager of Indiana Bell. Three years later, he was elected vice president, rates and revenues as well as secretary of Indiana Bell. After serving as vice president at Bell of Pennsylvania and chief operating officer at Illinois Bell, he became business services vice president at AT&T in 1978. In September 1986, he was elected president and chief operating officer of AT&T. He assumed his current responsibilities as chairman and chief executive officer in April 1988. According to Cook et al (1997) the leadership style that Allen has adopted in change was enrolling style he was both people oriented and task oriented. He involves the people in 1996 change through different meetings and committees. According to Bob Allen (1998, p.241)

I never thought that I could be so knowledgeable and so current in our businesses and markets that I could make the decisions. I have always advocated of shared decision making. (See appendix 3)

He was the chairman and chief executive of the company since 1988 and he already made the changes from 1989 to 1994 when, AT&T surprised everyone. He had a good vision and to see the external environment that was the changing in the telecommunication law he announced the restructuring in order to meet the challenges of the new laws. He also emphasis on the both hard and soft side of the business. On the change from 1989 to 1994 when previously he begins work on the explicit statement of the AT&T values , This explicit statement of AT&T values than becomes Our Common Bond which was adopted in 1992 able to create the shared values with in the employees . He has good knowledge about the company due to experience. C. Michael Armstrong C Michael Armstrong was born October 18, 1938, in Detroit, Michigan in 1961.he obtained many different degrees ,in 1961 he do bachelor of Science from Miami university in 1997 hoary degree from University, in 1998 honary degree from Loyola Mary mount University Worked for IBM from 1961 to 1992. From 1992 to 1997 worked for Hughes electronics as chairman and CEO .In 1997 becomes the chairman and chief executive of AT&T. AT&T is led by a new Chairman and CEO, C. Michael Armstrong, whose primary focus includes quick decision-making and global expansion both providing clear benefits to the Government. At the stake is the future of AT&T--and Armstrong s own reputation. Armstrong was widely considered one of Corporate America's best and brightest when he landed at the telephone giant in 1997 after a sparkling career at IBM (IBM) and Hughes Electronics Corp. (GMH).Armstrong works 18 hours a day .Spending his weekdays on AT&T's operations and his nights and weekends on

the break-up. In between, he has crisscrossed the country, wooing investors, customers, and employees (business week). The leader ship style which he also adopted was enrolling. (See Appendix 3).

Summary AT&T set the strategy. They backed it up with investments and acquisitions. And AT&T restructuring also delivers the result because however elegant the strategy, its results that count. In 1999, they made significant strides to transform AT&T and deliver growth. They finalized many of the strategic acquisitions they announced in 1998.They completed their $52 billion merger with Tele-Communications, Inc. (TCI) in March 2000.In 2000 AT&T completes it acquisition of Media One. In this transformation period AT&T spend more than $100 billion investments ,later AT&T is truly broadband and boundless. They ventures Merger with cable giants Tele-Communications Inc. and acquiring of Media One Group have saddled the company with an alarming $62 billion in debt. And new initiatives, such as selling high-speed Internet access and local telephone service over the cable-television network, are still too small to pick up the slack. (BUSINESSWEEK
ONLINE : FEBRUARY 5, 2001 ISSUE

fundamentally expanded their

customer offers through focused, strategic acquisitions, merger ,de merger and joint

). But AT&T is a big company and it does not have a big

affect on it

References Books [1] Henry Mintz Berg, James Brian Quinn, Sumantra Ghoshal (1998) the strategy Process (Revised European Edition) .Prentice Hall Europe. [2] Bob De Wit, Ron Meyer (2004) Strategy: Process, Content, Context (Third Edition). Thomson Learning. [3] Gerry Johnson, Kevan Scholes, Richard Whittington (1998) Exploring corporate Strategy: text and cases (seventh edition) .England, Pearson Education Limited. Journals Chris Ashton (2002) Human Resource Management International Digest :HR transformation at AT&T Consumer Services, 10 (5) pp. 6-11. Websites http://www.att.com/ehs/annual_reports/ehs_report/report97/common/ll.html http://www.att.com/history/history4.html http://www.att.com/ehs/annual_reports/ehs_report/report96/page1.html http://www.lucent.com/press/1095/951012.chc.html http://www.att.com/ehs/annual_reports/ehs_report/report98/ess/ess_2.html http://www.time.com/time/digital/digital50/09.html http://www.att.com/gov/docs/vol_2sec6a.pdf http://www.att.com/ar/docs/annualreport_1997.pdf. http://att.com/ar/docs/annualreport_1998.pdf http://att.com/ar/docs/annualreport_1999.pdf http://att.com/ar/docs/annualreport_2000.pdf http://www.lucent.com/press/0995/950920.cha.html http://en.wikipedia.org/wiki/Michael_Armstrong http://www.att.com/gov/docs/vol_2sec4a.pdf http://www.att.com/gov/docs/vol_2sec6a.pdf http://www.time.com/time/digital/digital50/09.html

http://www.att.com/ehs/annual_reports/ehs_report/report98/ess/ess_2.html http://www.businessweek.com/2001/01_06/b3718151.htm http://www.forbes.com/finance/mktguideapps/personinfo/FromMktGuideIdPersonTea rsheet.jhtml?passedMktGuideId=28464

Appendix 1

Adapted from Balogun & Hope Hailey 1999 Types of Change

SCOPE Transformation Realignment

Incremental NATURE Big Bang

Evolution

Adaptation

Revolution

Reconstruction

Appendix 2
Cultural Web

Rituals And Routines Control and Reward Systems

Stories
Symbols The Paradigm

Power Structure Organisational Structure

Appendix 3 Leader Ship Style

(Adapted from Cook et al 1977) Low People Orientation High Laissez-faire Autocratic

Democratic

Enrolling

Low High Task Orientation