Transformational Change at HTC ECCH - Case Study Example

Transformational Change at HTC ECCH ref: 9-412-070 HTC has made incremental strategic changes over its history but has not made a paradigm shift. Case study-Quietly Brilliant: Transformational Change at HTC ECCH ref: 9-412-070. Introduction HTC, a Taiwanese based Smartphone manufacturing company established in the year 1997, is a global smartphone production company that runs google's android operating system. The aim of this paper is an analysis of HTC and the analysis of tools, models and concepts that HTC has used. These models learnt in the leadership and corporate strategy course are models that HTC has applied in the process of its growth from notebook manufacturing to Smartphone production. Examples that analyse change have also been investigated with a focus on the period after establishment before going to smartphone manufacturing. This is in support that HTC has made strategic changes as well as a taken paradigm shift. (Tushman & Herman, 2012) Models Evolution and revolution Evolution and revolution in a company can lay its basis on either its size or age. Evolution and revolution both provide phases of growth and crisis. These exist throughout the growth of the company from being a young company to being mature or from being small to being large. Phase 1 is the period of creativity. Here founders have entrepreneurial and technical focus and there is regular communication between employees. The long working hours are rewarded. The crisis here is where the founders need to undertake control in all matters and are sceptical about giving the power to any other person. For example at the start of HTC, the company adopted a five-day workweek that was an unusual step in Taiwan. The employees were also legible to an year-end bonus. Technical and entrepreneurial focus is also seen where Cher Wang’s colleagues bring palm devices for review and that leads them to start working on theirs. Control is evident where Cho and Chou are the sole recruiters of the engineers, which also says a lot about the focus on a technicality. For example in Peter, the employees acknowledge that they had a CEO, who would sit down and take ideas from anyone. As growth continues, there is more specialisation as the processes in the company become more established. Communication also becomes formal. In reference to the growth of HTC, meetings are in Chinese but official email communication had to be in English. As the company grew, age and processes became more established. For example, HTC shifted design and much of the manufacturing work from subcontractors. In 1999 in-house manufacturing and design at the MAGIC labs started. Another phase of evolution and revolution is evident in the delegation. This is evident where HTC realised that it was difficult to focus on both innovation and sales. This led to the development of the MAGIC labs where innovation took place in a while to boost up sales opposed to sending a few engineers and a sales team to make deals. James Mackenzie came in to set up a sales organisation in Americas. Coordination and collaboration are the last steps in evolution and revolution. Coordination is in global campaigns such as the YOU campaign helped HTC to develop new processes and practices. The YOU campaign provided the first situation where all regions were working together in coordination on a global scale. (Tushman & Herman, 2012) Theory of E&O Theory E focuses on maximising economic value through the maximisation of the shareholder value. Theory O focuses on developing organisational capabilities. Both theories focus on leadership by encouraging participation. Focus aims at emphasising structure and systems while building culture and attitude. For example, HTC maintained they could do culture that was aggressive in chasing opportunities while ironing out issues. For example, a keen fix it attitude was in the employees. An openness culture is also there in HTC where an employee could go directly to the top management if there were need. Theory E&O also encourages planning and experimentation in order to increase economic value. For example, HTC saw that wireless technology was making headway into computers, notebooks and, therefore, realised that cell phone capability was in the horizon. This made them shift to the next generation technology of Smartphone. (Tushman & Herman, 2012) Culture web Culture web is because of many factors that all interact to affect culture. For example rituals, control systems, organisational structure, power structures symbols and others. A culture is a way of how things go about. For example, HTC had an aggressive culture of doing things in terms of seizing opportunities. There is also a focus on making things happen in HTC with employees having a keen can fix it attitude. The culture is could do, open and driven by opportunity. There is pride in working for HTC, but humility is evident in customer dealings. HTC also discourages bureaucracy whereby an employee may directly communicate to the top when something needs urgent attention. The culture is to address the problem at hand immediately and move to the next as quickly as possible rather than waste time communicating. There is also the culture to speak English in all formal communication. Meetings are in Chinese though, and every employee is required to learn English. (Tushman & Herman, 2012) Natural Change, the Ancestral Model Change may be because of situational demands, organisational context or because of individual processes. For change to occur the people to whom change is aimed at need to understand the big picture. Mutual change is also needed in addition to timely decision-making and implementing change in a step-by-step manner. Change involves planning. The case of HTC preparation to take the leap from PDAs to Smartphones is an example of a change. The process involved proper timing, the correct time of inflection and required a lot of internal planning work. HTC is always changing. They always want to be better, and exclaim that change is exciting for them. Change means that they are experiencing challenges and fixing them. Strategic changes and Paradigm Shift HTC has made incremental strategic changes over its history and has made one paradigm shift. Since its founding in 1997, HTC was known as High Tech Computer Corporation. After formation, HTC mainly developed notebooks. After formation, HTC started developing an interest in PDAs, which represented a shift. The development of the wireless technology in the future later represented a shift into smartphone manufacturing. Over the course of growth of HTC, it has made several changes. HTC leadership is thoughtful about changes that are required in the organisation and the results that adopting changes bring to the organisation. Another significant paradigm change was starting its in-house production and focus on the sole production of PDAs. For example, when starting, the organisation's business came from referrals. This was because of its high manufacturing reputation. In 1998, HTC engaged with Compaq in production and shipping of Areo 2100, which was a PDA. HTC, awarded manufacturing companies with contracts. Compaq wanted volume in manufacturing, which HTC was limited. This resulted in HTC dropping Notebook Production. Because of partnership with Compaq in the beginning towards joint production of a PDA, HTC experienced few challenges that resulted in it adopting changes. For example, because of frequent delays that were taking place, the regular upgrades on their partners, side challenges in dealing with the consumers became a problem. As a result, HTC decided to develop skill in managing partnerships in both software and hardware to help solve the problem with the PDA consumers. In 1997, the organisation explored the development of pagers for other companies. This represented a dive into wireless technology. The days of the PDA were ending, and they needed to move to the next generation product that were Smartphone. (Tushman & Herman, 2012) Conclusion After adopting strategic changes in the organisation, focus taken by the founders at HTC towards paradigm shifts, it has grown to be one of the most successful smartphones manufacturing branded company of the 21st century and even producing some of the best smartphones we find in the market today. The sales between 2004 and 2005, for example, grew by over 102% to almost attaining over 2.2 billion dollars. This period also represented the shift to a branded company that we recognise today as HTC. (Tushman & Herman, 2012) Reference List Read More