O2 Germania Case Study

1162 Words 5 Pages
Register to read the introduction… The functional divisions such as HR, Sales and Marketing were tailor-made for the German market, pointing that o2 Plc used a decentralized and polycentric approach for its German subsidiary. Only certain functions and processes such as corporate finance, board of directors reporting, and corporate strategy were kept uniform across o2 Plc subsidiaries and the communication was in English. Conveniently for o2 Germany at that time, Telefónica had an established branch (Telefónica DE) since 2003 in Germany as a wholesale Internet Carrier providing network infrastructure services to Internet Service Providers (ISP) such as Freenet and HanseNet/Alicey. The top management of o2 Germany tried to convince its employees that Telefónica was anyway its preferred partner to help it achieve its aspirations of becoming an Integrated Communications Service Provider (fixed/ cellular telephony and internet surfing) and hence its acquisition was perfectly timed for its benefit, apart from strengthening the company’s finance and being adopted by a formidable “mother”. Post-acquisition, Mr. Gröger was appointed joint CEO of o2 Germany and Telefónica DE. However the subsequent poor revenues in the following six quarters forced CEO Gröger to announce …show more content…
The layoff programme on the new management’s agenda did further damage. The employees were feeling detached from the organization. They assumed that the Spanish CEO’s main role was to trim the company down and that they were not strongly represented within the Telefónica Group, leading to low employee motivation and several experienced personnel opting for the layoff with compensation programme. The network division was skeptical about the capabilities of its CTO, having only previous experience in Argentina, to lead in the German market, where quality and regulatory requirements were more stringent. Every effort from the management to identify synergies between the two companies was met with resistance, as it was seen as a redundancy-identification …show more content…
The company took a new guise as Telefónica o2 Germany and has returned to show performance on par with its competitors. Long term objectives have been set up and strong commitment from the Telefónica Group have been communicated. Concluding, the new management likely was expecting the cross cultural challenges and had sufficient experience from other Telefónica acquisitions across Europe in the previous years. The management acted sensitively and carefully while rising up to the challenges it faced and hence was able to lead and steer the organization towards achieving its

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