Sample Case Study on AT&T

The CRM upgrade project at AT &T Wireless was in many respects an integration project. This is because the company was trying to merge various elements of its CRM (Customer Relationship Management) that were not compatible with one another in the absence of a new software to make this so, and hence the CRM upgrade. When in 2001 AT&T Wireless decided to install version 6.0 of Siebel’s CRM system, this was with a view to integrating the front end of the telco’s customer services processes with its back-end. In this case, the back-end processes consisted of the metering processes and rate plans of AT&T Wireless. It also entailed integrating systems involved in the provising of new numbers and tracking of calls across the country and the globe.

However, the existing systems were so complex that it was necessary to highly customize Siebel’s version 6 that AT&T had adopted. Moreover, AT&T had adopted a type of technology known as TDMA that was limiting the progress of the company in that it lacked the capacity to handle the transfer of data over cellphones. In 2001, AT&T had began to build out a new but expensive GSM system. However, it proved to be a huge hindrance to CRM in that it was every hard to convince old customers to drop TDMA and embrace the new GSM network. AT&T hoped that the CRM upgrade would solve this problem.

There are several key drivers that informed AT& T’s decision to embark on a CRM upgrade project. To begin with, AT& T had lost its position as market leader in the telecommunications industry. In 2001, AT&T was the market leader with a 25% share of the market. However, by 2003 when it started its Siebel CRM system upgrade, it had already been overtaken by Verizon and Cingular and relegated to position three with a market share of 17%. AT&T was thus trying to play catch up. Another key driver of AT&T’s decision to upgrade its CRM system was the need to add onto its new capabilities that would hopefully minimize the number of customer service screens that customer representatives used. This was made possible by establishing a portal that would essentially consolidate the various information sources and systems, in effect leading to a faster customer sign up process.

Moreover, in a bid to catch up with the competition, AT&T needed to handle more customers and more transactions. This required the establishment of a more robust CRM system. Besides, the CRM upgrade would enable AT&T’s customer care representatives have increased accession information obtain detailed information on customers.

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Strategy, structure, and culture are three important ingredients in the DNA of any organization. Strategy entails deciding the domain, scope, and nature of a company’s activities. It involves such factors as the core values of an organization, its vision, critical success factors, and reputation/brand, among others. In the case of AT&T, by adopting the Siebel upgrade project, the company wished to embrace a growth strategy that would enable it to increase its market share by improving the sign up process of new customers. On the other hand, the structure of an organization refers to the division of various organizational activities, and coordination of efforts.     It fortifies external and internal accountability and power operates with the company.  One of the key aspects of AT&T’s structure that the Siebel upgrade project focused on was number portability. This brought the need for outsourcing services whereby AT&T outsourced the work to TSI Communications, in addition to utilizing software developed by Telcordia.

Finally, culture refers to the set values, beliefs, policies and norms. They can be unplanned, developed over time, or emergent. The culture of an organisation greatly influences its effectiveness and operations. With regards to AT&T, the company needed to reduce its cost per subscriber. Ranked as the second highest in the industry, the high cost per subscriber rate was caused by the slow rate at which customer service representatives accessed customer information. The Siebel upgrade project was thus billed to help fix this problem.

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            AT&T was faced with a number of technological challenges in as far as the Siebel upgrade project was concerned. To begin with, the company had a good number of its customers running on the CTMA network. One of the drawbacks of this network was that it could not support data, which was a necessary requirement with regard to cell phones. While AT&T had already rolled out a project to design a GSM network that would support data, it was very hard to convince existing customers to switch from CTMA to GSM. Consequently, AT&T lost a good number of its existing customers to competitors. Another technological challenge facing AT&T was the requirement by the Federal Communications Commission (FCC) that telecommunication companies should implement the ‘number portability’ requirements, and even gave a deadline.  While AT&T had hoped to beat this deadline, the upgrade process took longer than expected owing to the complexity of integrating back-end systems.

In addition, the project was characterized by poor coordination between Deloitte and Touche, the lead project integrator, and project teams. Teams involved in the upgrade project also worked independent of each other, as opposed to cooperating with one another. Consequently, when a team had finished revising part of the project, coding would have changed elsewhere as the previous changed were not frozen to facilitate the revisions. This rendered testing meaningless.

5.

            AT&T recorded a lot of failures in the manner in which the company went about managing the risks occasioned by the implementation of its Siebel system upgrade. To begin with, installing the Siebel system upgrade entailed the integration of complex systems integration, not to mention the numerous revisions and testing involved. This caused the system to crash severally, even as the deadline for the adoption of wireless number portability loomed.   In this case, AT&T lacked an alternative means of accessing customer data by switching to the earlier version that had proven stable but slow. Having a plan B would have saved AT&T valuable clients from migrating to its rivals, as well as millions of dollars in lost revenue.

Second, AT&T chose a competing vendor to the one chosen by all its key competitors for wireless number porting. This involved additional layers of integration that were not successful, ultimately. AT&T might have overcome this failure by limiting further integration and adopting for the same vendor that its rivals had chosen.

Another area in which AT&T failed is that it carried on with its plans to offshore outsourcing and layoff some of the employees while the Siebel system upgrade was still underway. When rumors started swirling regarding possible layoffs and outsourcing, this affected the morale and productivity of the employees. Sadly, the management did not seize the opportunity to clarify the authenticity of these rumors, and this only made matter worse. In future, it would be better to postpone offshore outsourcing and layoffs until after the completion of vital systems project.