Assignment
Management: With Shouts and Hugs, Sprint Boss Drives Turnaround by: Mayumi Negishi And Ryan Knutson.
TOPICS: Acquisitions, Cross-Cultural Differences, Management, Management Styles
SUMMARY: Sprint, T-Mobile, Verizon and AT&T are the major players in the U.S. wireless industry. AT&T and Verizon are the biggest companies with more than 100 million wireless customers each while T-Mobile has 47 million. Growth is 12% at Sprint but 40% at all other rivals. Sprint was supposed to be a strong competitor with T-Mobile for a couple of years before aiming for a merger. But T-Mobile surged and Sprint did not. The company is owned by Softbank, a Japanese company. The CEO, Masayoshi Son, encountered challenges and cultural issues. One challenge is that Sprint needs to improve its network so it has the infrastructure for its customers. Son had great success in Japan upending the market. The regulatory process, the breadth of land mass involved in the network rollout and advertising contracts are different in the U.S. Son spends time in Japan and in the U.S. as he tries to integrate the company. Data on employee performance and updates help Son track progress.
CLASSROOM APPLICATION: Cultural differences are often an issue in mergers and acquisitions and Sprint is no exception. The additional challenge is that there are differences in cultures at both the company and the country level. The CEO of Sprint has a management style very different from the prior CEO. Son is frustrated with the regulatory environment in the U.S. which is slowing the rollout of the new network. Son wants to move quickly to acquire T-Mobile, but U.S. regulators are concerned about the effect on competition. Son is having problems translating his success in Japan to the U.S. T-Mobile has the role of brash outsider instead of Son and Sprint. Son is actively engaged in the company and trying to integrate U.S. and Japanese operations and workers. One interesting aspect of the merger is that the former CEO and Son seem to get along and are compatible. Son relies on Daniel Hesse to help explain the U.S. market. Sprint illustrates the importance of cultural difference at all levels and the role they play as companies combine and compete. Son's frustrations and hands-on approach to management reflect strategies that worked in Japan. The company has not achieved what Son hoped, but he and the company continue to adapt
QUESTIONS:
1. Describe Son's management style.
2. What are the cultural issues both at the company and country level that might affect Sprint.
3. List and describe all the frustrations and challenges Son faces in the U.S.
4. Optional Brain Teaser Question: (will not be graded, but I am interested to see any ideas you may have):
In a market where the next competitors are twice their size, why do you think U.S. regulators are concerned about a possible T-Mobile and Sprint merger?