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CHANGE INITIATIVE ASSESSMENT
Change Initiative Assessment
Sarah D. Kelley
School of Business, Liberty University
Author Note
I have no known conflict of interest to disclose.
Correspondence concerning this article should be addressed to .
Email:
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CHANGE INITIATIVE ASSESSMENT
Change Initiative Assessment
Introduction
The change initiative assessment will be covered in two parts. The first part will provide
the background of how T-Mobile and Sprints’ merge began, what the CEOs will do to guarantee
service to consumers, and how it will fulfill their vision of added jobs. In the second part of this
assessment, I will cover defining the change, the situation, and suggest key strategy
recommendations.
Part 1
On April 29th, 2018, T-Mobile and Sprint CEOs came into agreement to pursue a $26
billion merger, which is the nation’s third and fourth largest carriers (Harvard Law Review,
2019). The merge would be under the name of T-Mobile, and it is projected to provide 130
million new subscribers, which would be comparable with Verizon and AT&T (Harvard Law
Review, 2019). There were concerns right from the beginning such as, “higher prices, less
competition, job losses, and harm to rural consumers” (Ecn, 2019, para.1). Additionally, the
Department of Justice (DOJ) Antitrust Division were concerned that losing Sprint as a large
fourth competitor would cut down innovation. Despite the apprehension raised, the DOJ
approved the merger on July 26, 2019. However, yes, they approved the merge, but they put
three conditions in place. First, the DOJ would dictate certain assets from T-Mobile and Sprint to
DISH Network, which would allow DISH Network to become a replacement for Sprint as the
fourth biggest wireless carrier (Harvard Law Review, 2019). Second, the DOJ would order T-
Mobile to offer to sell all “Sprint’s 800 MHz-spectrum holdings to DISH” (Harvard Law Review,
2019, para. 8). Finally, the DOJ would make T-Mobile to offer DISH access to its network while
they prepare to build a facilities-based network.
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The first Headquarters will be in Overland Park, KS and there will be a new Customer
Experience Center which will be a substantial amount of job opportunity. In the beginning, the
leaders had to work with local, state, and federal leaders like Gov. Kelly and Sen Moran (Ecn,
2019). T-Mobile and Sprint suggest that by 2024 the merged company will provide jobs for
7,500 workers, and in total they predict more than 12,000 new jobs. CEOs had to testify and
communicate their vision, strategy, and impacts on consumers, competition, and jobs (Ecn, 2019,
para. 5).
The merger was not going to go smoothly since there were many concerns from other
parties. Many groups were pressuring policymakers to stop the merge, because it would cause
“higher prices, less competition, and damage rural consumers” (Ecn, 2019, para. 10). However,
T-Mobile and Sprint have vowed those rates would not go up, and that would guarantee
consumers will not more and get less product rather the opposite (Ecn, 2019).
The reason that Sprint wants to merge with T-Mobile is because they claim that they can
not compete in 5G. Sprint has adjusted their network, however, they still lacked low-band
spectrum, and they will get that from T-Mobile (Ecn, 2019). Sprint was suffering with a
weakening network, and they began to mislead the community by rewarding sales personnel to
push extra free lines, in which falsely showed Sprint’s subscriber numbers. Aside from
policymaker’s complaints, there were also 10 states that were against the merge, the 10 states
included: New York, Colorado, Connecticut, the District of Columbia, Maryland, Michigan,
Mississippi, Virginia, and Wisconsin. These states felt the merger would reduce market
competition especially with the smaller carriers (Hcn, 2019).
Wallsten (2019) conducted an analysis of the merger, and he suggests that the merge will
increase prices of current consumers, especially for lower income areas, and will slow the release
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of 5G service. Wallsten (2019) also emphasizes that the merge will have a network that will be so
large that it will interrupt the wireless industry. It is difficult to predict the future on how the
competition will take place, and it is uncertain of the demand of 5G. Additionally, there were
analyses conducted of other mergers, and the results could not provide any consistent evidence;
some showed increases in their prices, and some showed no change at all (Wallsten, 2019). T-
Mobile and Sprint say that by merging they will save $43.6 billion, and together they can
provider a better 5G service for consumers.
Part 2
To begin this proposal, I would like to define the project in which the central point is to
maximize T-Mobile and Sprint’s competition by merging. Important benefits to mergers are
reduction in costs, driving business more efficiently, more profitable, and lower cost of labor
since employees are more productive (Wallsten, 2019). Sprint has shown that it is failing by not
fulfilling its financial obligations, therefore, were pressured to file Chapter 11 bankruptcy.
Sprint’s initial weaknesses were that they had meager brand awareness among the consumers and
the long-term employees (Gilliland, 2017). Sprint is fully aware that they are not an effective
organization on its own, are not attracting new customers, and have low quality competition
(Wallsten, 2019). An interesting fact about the low-income consumers is that the merge would
account for about 47 percent of consumers with incomes of less than $50,000. This is a great way
to be competitive with the other big carriers, have a focus on low-income consumers. Another
recommendation would be to focus on the rural communities because the merge will allow for
more coverage than what they would have by themselves (Wallsten, 2019). Wallsten (2019)
suggests having the government make spectrum open for use at any time, and the National
Telecommunications and Information Administration could “find ways to make federal agencies
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incorporate the opportunity cost of their spectrum into their work in order to create incentives
efficiently” (Wallsten, 2019, p. 22). Since T-Mobile and Sprint made a commitment to cover 85
percent of the rural areas with “low-band 5G within three years of the merger closing” they will
need to make sure they keep their word and take care of the rural communities (Ecn, 2019, para.
3).
T-Mobile and Sprint will need to continue with diagnostic approaches such as the
PESTLE (political, economic, social, technological, legal, and ecological) framework which is
understanding the impact of future opportunities and evaluate risks (Heinz, 2022). They did a
good job with using a four-frame model that Heinz (2022) suggests by looking at the
organization from different perspectives, which will help to creative solutions. T-Mobile and
Sprint knew that they could not compete with 5G on their own, so the solution was to merge. For
this merge to be effective a good model to use is the six-box organizational model which include:
purposes, structure, helpful mechanisms, relationships, and leadership (Heinz, 2022). Moreover,
T-Mobile and Sprint should focus certain areas of the merge especially as it become final in
2022. A great model to keep as a foundation for the merge is to focus on the star model that was
created by Galbraith (Heinz, 2022). The star model allows alignment of an organization’s
strategy, structure, processes, rewards, and people practices (Heinz, 2022, p. 112). The model
covers what kind of vision or strategy will take place and it is important to be clear. It also covers
relationships, activities, and how performance is measured by using a reward system.
Heinz (2022) suggest organizations should use key elements of strategy when navigating a big
change. T-Mobile and Sprint have developed a strategy in which they focus on their core
business which is a major cellular provider. Moreover, they provide key details on how they
would be able to create thousands of jobs and be a key competitor. They knew they could stand
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out by combining and keep their costs low and competitive. Once the approval of the merge
happened, they had a timeline to have everything merged by June 2022. T-Mobile states they are
committed to serving their consumers by removing annual service contracts and roaming fees.
T-Mobile and Sprint used pace as another strategy, which is wise because they took two to three
years to have everything complete (Heinz, 2022).
Now that I have discussed recommendations to make the change effective, it is important
to endure the changes and I will talk about some concepts for sustainment. According to
Oh & Johnston (2021, para. 1) organizations need to pay special attention to the post-merger
integration process looking at not only “performance gain but also unexpected performance
losses.” There are times when organizations lose focus during a merger and forget what their
vision for an outcome really is. Other areas that need to be looked at are the main threats that
could cause decline or hinder sustainment of change (Heinz, 2022). For example, accountability
is lacking and those that are responsible have stopped driving the change and “returned to their
normal roles” (Heinz, 2022, p. 364). Another threat that Heinz (2022, p. 364) emphasizes is
potential for “knowledge and experience with new practices are lost through staff turnover.”
Finally, the best change image strategy for T-Mobile and Sprint would be to use a
navigator and coach approach (Heinz, 2022). The navigator stays focused on any threats that
could stifle the change, attack any problems that arise, explain what the change is and how it will
provide value to the employees (Heinz, 2022). The coach approach makes sure the organizations
values are the bedrock of change and encourage people to communicate using not only words but
action as well. Coaching is a tool to gain buy-in and have effective “two-way communication”
(Heinz, 2022, p. 217.)
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Conclusion
In conclusion, the change initiative assessment I presented was covered in two parts. The
first part I provided a clear background of how T-Mobile and Sprints’ merge began, what the
CEOs did to guarantee service to consumers, and how it achieved their vision of added jobs. In
the second part of this assessment, I covered the change definition, the situation, and suggested
key strategy recommendations.
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References
Analyst: T-mobile price promise may indicate merger approval trouble. (2019). Ecn.
10 states sue to block T-mobile-sprint deal. (2019). Ecn.
ANTITRUST - HORIZONTAL MERGERS - DOJ APPROVES T-MOBILE/SPRINT MERGER
UNDER DISH NETWORK-ENTRY THEORY - proposed final judgment, united states
v. deutsche telekom AG. (2019). Harvard Law Review, 133(2), 739.
FCC’s pai backs T-mobile-sprint merger. (2019). Ecn.
Gilliland, R. A. (2017). Sprint’s social media ninja program: A model for teaching consumer
relations. Business and Professional Communication Quarterly, 80(4), 473-483.
https://doi.org/10.1177/2329490617712513
Heinz, A. (2022). Leading organizational change. McGraw-Hill education.
Oh, J.-H. & Johnston, W.J. (2021), "How post-merger integration duration affects merger
outcomes", Journal of Business & Industrial Marketing, Vol. 36 No. 5, pp. 807-
820. https://doi-org.ezproxy.liberty.edu/10.1108/JBIM-11-2019-0476
Rural wireless groups react to pai endorsement of T-Mobile/Sprint deal. (2019). Ecn.
Sprint loses 189K postpaid phone subs, warns of woes without T-mobile merger. (2019). Ecn.
T-mobile reiterates confidence for approval of sprint deal. (2019). Ecn.
T-mobile, sprint promise to create 5K new jobs with customer experience centers. (2019). Ecn.
