Vodafone in United Kingdom - Coursework Example

VODAFONE ANALYSIS Section A Evaluation of Vodafone’s Competitive Environment Vodafone is currently experiencing many changes in its market (operating environment). Due to the diversity of the communication service providers the traditional boundaries of the market have greatly changed. These service providers offer, internet, mobile and broadband services. This change has been enforced and brought about by the evolution of customer needs, an intensified competition in service prices from established and the new competitors, new technologies emergence and regulatory pressures ( Grant, 2010, p. 20). Vodafone’s Market positioning strategies Due to Factors like; Diversification, market penetration, product development and market development, Vodafone has undertaken the following marketing strategies. There is; Promotions, Price Cuts, Development of new products and market development by starting its new organization in new places (Grant, 2010, p. 25). For effectiveness in marketing, Vodafone operates with different branches across with the world with different management. In 1998, the company made a deal with Telecom Egypt which enabled it to increase the stake in the country. After that Vodafone in Egypt was owned by Vodafone 55 % and 54 % Telecom Egypt. This made the company to increase is sales because Telecom Egypt assisted in marketing. The chart below represents the number of shares owned by Vodafone and Telecom Egypt in Egypt. Porter’s Theory Through the porter’s generic theory of the business environment, the company has identified the possible ways of achieving a competitive advantage over the competitors. Through this theory, the company can identify the weaknesses and strengths of its competitors and capitalize on them. Vodafone has identified the power of the buyer and the power of the supplier in expanding its business. This is achieved through Product Development, and diversification of services offered. It is considering a buyout of T-Mobile and the merge between 3 Mobile and Vodafone (Johnson, 2011. P. 68). Resources and Capabilities of Vodafone Provision of quality services to the customers is among the pillars of the company in its advancements over the past five years. This has been made possible through; Transmission of wireless signals through over 200,000 base station sites, Offering a download speed of 28.8 mbps and nearly 700 billion minutes of network traffic and 90 petabytes per year of data. Vodafone has also made an alliance with the technological organization Apple. Worldwide, Apple, is among the biggest technological organizations. Through 3g services, the companies attract more customers in Asia and Europe (De Wit, 2010. P. 70). Vodafone also provides other services which include services of mobile money transfer in corroboration with companies like Safaricom, mHealth services, charity for supporting mobile technology known as Vodafone foundation. For those services the mobile money services brings more income to the company than others. The table below shows the resources and the year for establishment of each service (Johnson, 2011. P. 68). Services Year of Establishment Mobile Money 2007 mHealth Services 2009 Vodafone Foundation 2009 Development of These Resources and Capabilities The company undertakes the measurement of the key performance indicators across their networks on a continuous base. This ensures high standards of availability and service quality. The dominant Strategy The best strategic option is for the company to focus on Diversification by entering into the Electronic equipment market. The company can produce Vodafone microwaves, Vodafone washing machine and Television. It also enhances the capabilities and resources of the company (Grant, 2010, p. 82). SECTION B Cultural change in Vodafone Making the cultural change in the company work and advancing workers motivation and engagement, requires; Understanding what is causing the workers morale to go low. A dedicated and a committed management team. An approach that is properly structured to help in addressing various issues. A communication strategy that is well-designed. The company managed this through the launch of a cultural alteration program. The objective being to renew the manner in which individuals worked, taking more attention on customers and improving on the self-perception f the team (Grant, 2013. P. 88). Strategic change/ Drift There are exist significant changes in the companys sponsorship strategy. First the company decided to cut ties with McLaren. They argued that the exposure offered by Formula one connection has gone down. It is also planning to terminate its sponsorship of Dublin GAA. The company will do its own events other than getting involved in other company’s events (Grant, 2010. P. 65). Vodafone development change Vodafone Music has been launched by the Vodafone India. This is a music service which is mobile internet based. The service is powered by a platform called Hungama’s. This helps the company elevate the level of data consumption (Lindgren, 2009. P. 56). Vodafone method of development The company started their journey towards sustainability in 2007. Vodafone set off towards Sustainable development by launching the sustainability platform referred to as “Vodafone Cares” This initiative aligns the company efforts towards Education, Environment and Empowerment. Innovation has not been left aside in the company’s development plan. Vodafone has been the second largest mobile network provider in India. In this country Vodafone ha been recognised as the best 3G Operator during the recent Telecom Operator Awards 2012 (Besanko, 2003.p. 47). Vodafone role of corporate parenting Vodafone has played a substantial role in advancing the role of corporate parenting through, Emails, Calls where individuals are able to check on the progress of their partners, siblings and kids for the case of parents. The internet helps parents in making informed decisions with regard to their family. Technology has also helped athletes in their personal lives and in their training (Johnson, 2006. p. 25). Vodafone’s different Eras Sir Chris Gent- He transformed the company from a small company to a giant company in the world, Inception of Scholarships to residents from different countries as a form of community benefit from the company. Arun Sarin- He brought about the wireless communication network, Played a significant role in the expansion the geographical boundaries of the company to countries like, Turkey, India, Ghana, South Africa e.t.c. During his era there was an increase in the company’s dividends per share by 400 percent, increased shareholders returns and Launch of the 3G mobile services. Vittorio Colao- During his tenure the company bought 100 percent of a broadband service provider i.e. Spanish broadband provider Ono. $ 10 billion which was on debt and cash free criteria. He came up with the idea of fibre network, through which they plan to reach around 1.5 million households. The idea of merging with other service provider, like, Portugal telecom and the Brazilian Oi, arrived in this tenure. Orange Spain and Vodafone Spain concurred to co-invest in deployment of TTH (Johnson, 2011. P. 70). Vodafone portfolio development since Vittorio Colao became CEO The service portfolio GPRS Mobile Office Voice Vodafone live 3G services Entertainment Applications Wallpapers Games Ringtones News and Updates Chat Downloads Products Portfolio Mobile Broadband Pay as you go Fixed line broadband Cordless Wired Pay monthly 3G data cords Smart phone Vodafone Business strategy Notably the company has structured its operations in three principle business Units; Middle East, Asia Pacific and affiliates, Africa and Eastern It’s headed by Paul Donovan and includes the merging portfolio and other businesses. Europe business unit, which is headed by Bill Morrow and encompasses all of the Vodafone’s Western Europe controlled businesses. New businesses unit, which is lead by Thomas Geitner, has responsibility in the delivery of new communication services addressing the Internet, converging areas of mobile and broadband. The Vodafone’s M2M business unit will form part of the Group-Wide Enterprise Unit (Grant, 2010. P. 37). Strategy Issues In emerging markets, the delivery of strong growth, Innovativeness and delivery on the total communication needs for the customers, Ensuring that the shareholders returns policy and capital structure are aligned to strategy, Maximising returns through active management of the portfolio, Stimulating revenue in Europe and reducing service costs are equal to the issues being dealt with by the company (Hill, 2010.p. 58). Application of Boston Matrix to Vodafone It actually explains Vodafone’s Market share rate and Market Growth. Through the employment of the Market mix as a product in Marketing strategy, the company is able to tell where they are and about their competitors. It plays a good part in helping the company in becoming a market leader. Vodafone is taking new technology help and finally becoming a successful company in the world (Grant, 2013. P. 69). Consistency of the Strategy There has been some consistency in the flow of the strategy as every director’s aim was to maximise revenue, market development, and product diversification. This is meant to cover more customers and to improve on the satisfaction of the customers by advancing technology and products to meet their demands (Grant, 2013. P. 15). Vodafone structure The new structure and organization will enable the company to advance in its service delivery to its customers. The structure ensures effectiveness and efficiency in the delivery of Priorities. It also ensures quick and consistency in the implementation of enterprise and customer plans Lindgren, 2009. P. 76). Strategy Sensibility The company strategy makes sense as the company will be able improve on their customer experience. There have been some Organizational changes which are meant to improve on the company’s commercial strategy making it more quick and consistent. Examples; Vodafone is creating an expanded Group Commercial Function, Partner Markets, Unified Communications, Customer Operations, Terminals and Comprising Brand. There is also the recently created Group Enterprise organization headed by Paolo Bertoluzzo. There are plans to merge Southern Europe and Northern & Central Europe into one Europe Region, headed by Philipp Humm (Grant, 2013. P. 34). Shared Values The company has advanced this idea through partnering with other companies, to help ease the burden of starting their own businesses in those areas. This offers a great potential for success in the future. For Example, Vodafone has partnered with MTN and nonprofits Switchboard to build a free calling network for doctors in Ghana and Liberia (Johnson, 2006. P. 47). Bibliography Besanko, D., Dranove, D., Shanley, M. and Schaffer, S. 2003. Economics of Strategy (3rd ed). NJ, John Wiley & Sons. De Wit, R. and Meyer, R. 2010. Strategy Process, Content, Context. And over: Cengage. Grant, R. M. 2013. Contemporary Strategy Analysis (8th ed.) Oxford. Blackwell. Grant, R. M. 2010. Contemporary Strategy Analysis. Text & Cases (7th ed.) Oxford. Wiley: Chichester. Hill, C.W.L. and Jones, G.R. 2010. Strategic Management Theory: An Integrated Approach. Boston: Houghton Mifflin. Johnson, G., Scholes, K. and Whittington, R. 2011. Exploring Strategy. (8th Ed, 9th Ed OR 10th ed) Harlow: FT Prentice Hall. Johnson. G, Scholes. K and Whittington. R, 2006, Exploring corporate strategy. (7nd ed.) UK: Prentice hall. Lindgren, M. and Bandhold, H. 2009. Scenario Planning. New York; Palgrave Macmilan Lynch, R. (2012) Strategic Management. (6th ed). Harlow: Prentice Hall. Van der Heijden, K., 2005. Scenarios: The Art of Strategic Conversation (2nd Ed.) Chichester: John Wiley & Sons Ltd. Appendix: Porters five forces Appendix 2: PESTEL AMD SCENARIO ‘Thing’ which may change Short, Medium or Long term? Importance or Impact/Relevance Very High High, Medium, Low Very Low Internal (I can control it) or External (Beyond my Control) Action to be taken Prices Long term Very High Internal Monitor the price of competitors Manufacturing Strategies Short High Internal Employ professionals to deal with manufacturing Marketing Procedures Medium Medium Internal Lay down marketing procedures in respect to current marketing trends Management Long Term Very High External Contract Human resource to employ the professionals to manage the company Read More