Investigation of Vodafone Qatar Company - Case Study Example

INVESTIGATION OF VODAFONE QATAR COMPANY By Location of the Investigation of Vodafone Qatar Company Introduction In the recent past, two key developments have significantly influenced operations of Companies. Companies find themselves being responsible to the society for matters and issues that traditionally belonged to the realm of nations. Companies have incorporated non-economical themes to their day-to-day running (Visser, 2012). Previously, Companies disregarded these non-economical themes. In the last decade, the apparent attention to societal and environmental impact of enterprises significantly increased. In line with this, the paper seeks to undertake an investigation into the operations of Vodafone Qatar, specifically looking at the role of Corporate Social Responsibility toward the Company’s shareholders. Additionally, the paper looks at the Company’s application of Corporate Social Responsibility practice and their implications for the stakeholders. Similarly, it investigates the business ethics of Vodafone Qatar by discussing theories of business about employees, consumers, and the government. Background on Vodafone Qatar Company Founded in 2008, Vodafone Qatar Q.S.C. is part of one of the largest telecommunication Group in the globe, Vodafone. Vodafone Qatar holds the second Public Mobile and Fixed Telecommunications Networks and Services License in the State of Qatar (Curwen, 2011, p. 9). The Public Company has its headquarters in QSTP Doha, Qatar. Similarly, it has a workforce of between two hundred and one to five hundred employees. The Company launched its mobile network on 1st March 2009 and shortly afterward began to deliver excellent value to its customers with a broad range of exciting services and products. The Company’s purpose makes it unique at the heart of all its undertakings. The purpose is to “Make a world of difference for all the people in Qatar.” The Corporation’s vision of its incorporation was “To be the most admired brand in Qatar within three years.” Vodafone Qatar aimed at not being just the most respected communication brand, but the most loved brand in Qatar. In just five years of its commercial operations, Vodafone Qatar currently prides in over 1.4 million customers. It means that sixty-three percent of the population of Qatar are actively using the services of Vodafone. Having established a world class converged IP network, in October 2012, Vodafone launched a broad range of fiber-based enterprise grade and residential fixed services and products with the inclusion of Corporate Internet and Data Network Solutions. Through the fiber connectivity, Vodafone is on the verge of becoming a complete communications provider contributing to the digital agenda as laid down in the ictQatar strategy 2015. Barnes, Raynor and Bacchus (2012) claim that the Corporation is committed to availing an excellent telecommunications infrastructure to support Qatar National Vision 2030 (p. 102). Corporate Social Responsibility On the Corporate Social Responsibility (CSR) front, Vodafone Qatar concentrates on continually giving back to the society through the Vodafone Qatar Charitable Fund and the Corporation’s annual World of Difference program. Similarly, Barnes, Raynor and Bacchus (2012) mention that the Company’s partnership with ROTA and their Vodafone for all accessibility initiatives with MADA are also among Vodafone’s CSR initiatives. Further, in May 2014, Vodafone launched AmanTECH, a program for youth safety and online child that aims at promoting literacy among parents and improving the digital safety of children. Role of CSR toward Shareholders Crane, Matten and Spence (2014) suggest that CSR has a crucial role towards the shareholders of a Corporation. The CSR of Vodafone Qatar significantly enhances its shareholders value. It aims at ensuring quality investment for the shareholders of Vodafone Qatar. It does this by driving efficiencies, identifying strategic opportunities and making sure that the Company’s leaders are committed to its performance. Additionally, CSR provides the Company’s shareholders with honest and clearly comprehensible information about the Corporation’s operations. Through CSR, Vodafone Qatar targets at being a sound investment for shareholders. One hundred percent of the Company’s share capital listed on the Qatar Exchange. Crane, Matten and Spence (2014) note that those shares are open to local and foreign investors to buy. Further, the Company targets at continuing to avail incremental dividends. To achieve this, Vodafone Qatar maintains a strict asset and cost quality surveillance. Similarly, Vodafone Qatar undertakes business honestly and openly; it provides shareholders with ready access to clear, balanced, and understandable information. The leadership of Vodafone Qatar in CSR strengthens the Company and enhances shareholder’s value. The Corporation makes the conscious business decision to contribute to charities and give to the society. Research and external studies of Vodafone Qatar signify that customers and the general public expect the Company to support and give back to the society in which they operate. Community support is among the key factors in the decisions of customers concerning where to trade. Employee research equally shows that the corporation’s workforce pride in Vodafone’s community undertakings and this in turn translates to higher employee engagement and performance that eventually benefits shareholders. The donations and other contributions made by Vodafone Qatar have shared benefit to the society and the Company. They have a positive impact on several people and local economies and assist in the construction of a stronger society, all of which are of value for the long-term success of Vodafone Qatar. CSR Theories and their Application by Vodafone Qatar Three major CSR theories depict and inform the current practice of Corporate Social Responsibility. Vodafone Qatar undertakes various Corporate Social Responsibility practices based on these three CSR principles. The Stakeholders Theory of CSR Since the 1990’s, the stakeholder theory has grown to become famous as a straight alternative and challenge to the shareholder value theory. The number of stakeholder’s pressure groups has significantly developed since the 1960’s. The stakeholder theory gives emphasis to special social instead of others not related to the corporation. Therefore, this theory depicts CSR as a company stakeholder responsibility. The policies and practices of Vodafone Qatar have a significant impact on the Company’s stakeholders. Given that Vodafone Qatar is a worldwide Corporation with local roots, it commits itself to providing accessible products and services for the society of Qatar (Curwen and Whalley, 2010). Due to this, the Company launched the Vodafone for all initiative in December 2012 in partnership with Mada, Qatar Assistive Technology Center. The initiative empowers all members of the Qatar society to stay connected despite any physical challenges. It enables the disabled in Qatar to keep up with the growing innovation speed of the communication technology world. The Company aims at supporting people with disabilities by providing them with accessible services and products that help them to benefit and enjoy from communication technology. In the first phase of the initiative, The Corporation launched permanent offers for all disabled customers. Vodafone Qatar considered two key factors in the creation of these two aspects. First, it examined the affordability of its products and services to a segment with the low employment rate. Similarly, it reviewed the challenges around physical mobility faced by disabled people. The initiative has been characterized by Curwen and Whalley (2010) as having significant implications to the Company’s stakeholders. It provides reliable services and products to disabled customers by collecting their monthly bill payments from their homes, saving them the challenge of hustle and bustle involved in traveling. The Corporation caters adequately for the communication technology needs of the disabled customers by efficiently selecting handsets with hearing and visual impairment features. Further, Vodafone Qatar enlightens its disabled customers by training them on how to use the accessibility features in the handset purchased. Business Ethics Theory of CSR The business ethics theory bases itself on the wider social obligation and the moral duty that business has towards society. The theory justifies CSR on three varied but interrelated ethical grounds. These ethical grounds include changing and emerging social responsiveness and social expectations to particular social problems. Intrinsic and external moral values always inspired by Kantian ethics, depicted as some universal and normative. Finally, the theory justifies CSR on Corporate citizenship with the view of a corporation as a better citizen in society to contribute to social wellbeing. The theory sees CSR as an ethical responsibility instead of economic and legal and financial responsibility. Vodafone Qatar applies the business ethics theory in its CSR operations and practices. In 2012, Vodafone Qatar collaborated with Weill Corned Medical College in Qatar to undertake a mission to educate the community in Qatar on leading a healthy lifestyle. The Corporation established a campaign dubbed ‘Your Health First.’ It aimed at spreading awareness about healthy lifestyles and nutrition education. The Campaign targeted the ten to twenty-five-year-old age group. Other key partners supporting the initiatives included the ExxonMobil, Occidental Petroleum of Qatar, and Qatar Petroleum. The launch campaign of the effort covered a wide topic range including benefits of vitamins, healthy eating habits, stress and insomnia, bone health and rheumatoid arthritis, diabetes, osteoporosis, and woman and child health. Sutherland (2012) opines that the initiative had a great implication on the health and wellbeing of the Company’s stakeholders (p. 16). By educating its stakeholders on these health issues, the Corporation enabled the young Qatar population to stay safe and be conversant with the health risks that pose a threat to their general wellbeing. The Shareholders Value Theory of CSR The shareholder’s value theory argues that the only social responsibility of business is to develop its profits in compliance with legal norms. The theory asserts that the aim of business is doing activities that contribute to society and economy, and its function needs no confusion with other social functions undertaken by non-profit organizations and governments. Despite the justification of maximization of shareholder’s profit as the most significant corporate responsibility, corporate social obligations are strategic instruments for the corporate competitive benefit. Vodafone Qatar efficiently applies the shareholder value theory of CSR in its operations and practices. In 2009, Vodafone sponsored the ROTA Gala Dinner that was the inception of its partnership with Reach Out to Asia (ROTA). In December 2010, ROTA and Vodafone Qatar entered into a five-year partnership with a QR nine million donation made by Vodafone Qatar. The contribution aimed at supporting education and community initiatives in Indonesia, Nepal and Qatar until 2015. According to Whalley and Curwe (2012), Vodafone supports The International Outreach Programs in Qatar. The program offers people in Qatar the opportunity to volunteer in Asian and Arab community projects. International volunteering enables Qatar locals to see their role as citizens of the big globe. Since 2010, over four hundred and fifty individuals and students have participated in volunteer trips in nations like Cambodia, Nepal, Tunisia and Indonesia. Kenney (2011) sees the project as having significant implications for the lives of the teachers and students from Qatar giving them the opportunities of sharing their skills on community development projects. Among the schools that have participated, include the College of North Atlantic, Al Bayan Independent School for Girls, and Virginia Commonwealth University in Qatar. Business Ethics Discussion on the Theories of Business Employees Employees make up the internal environment of Vodafone Qatar. The Company has approximately between two hundred and one to five hundred employees. It has complete control over its employees and can influence their performance. The Corporation employs staff with relevant experience and skill. When hiring its workforce, the Company begins with the recruitment stage and continues through ongoing promotion and training opportunities. Employees play an essential role in building an atmosphere of confidence, trust, and loyalty among the customers of Vodafone Qatar. The objective of business owners is profitability. According to Avina (2013), the success of Vodafone Qatar depends on the performance of their employees. Poor performance is detrimental to the success of the organization. The Company undertakes a well-rounded approach to coaching and managing its workforce through the expertise of its human resource leaders and support of their Company’s executive leadership. Consumers Discussion of theories of business about consumers is essential given that they are the sole reason for the existence of a Company. According to Thomson (2011), consumers form part of the microenvironment of a Company. Vodafone Qatar continues to expand its mobile customer base in Qatar. The Company grew its customer number by approximately thirty percent to reach over one million and eighty-four thousand customers as at 31 March 2013. Further, in just three years of its operation, over one million customers have chosen to be part of Vodafone customer base. Having over half the Qatar population using Vodafone’s services is an essential achievement for its shareholders, partners and staff. Government The government makes up the macro environment of Vodafone Qatar. Arora, Kalro, and Sharma (2015) claim that the Government plays a crucial role in the success of the performance of the Company. Vodafone Qatar has entered into several partnerships with the Government. The Company entered into a collaboration with the government to ensure the realization of Vision 2030 by delivering superfast broadband to businesses and consumers in Qatar. The initiative would not have been successful without the Corporation of municipality agencies and the Government. Similarly, Government plays a critical role by providing a conducive environment for the success of the Corporation’s activities. Applications of the Specified Theories to the Challenges The Corporation faces many challenges in the realization of its mission and objectives (Floyd et al., 2013). The section covers the SWOT analysis to reveal the areas of weaknesses and threats faced by Vodafone Qatar that need improvement. As well, the framework presents the opportunities and strengths that it should capitalize on to sustain it in the market. SWOT Analysis of Vodafone Qatar Svensson and Wood (2011) point out that SWOT analysis is a critical technique for comprehending the strengths and weaknesses of an organization. Similarly, it is useful in identifying both the opportunities open to an institution and the threats that it faces. In the case of Vodafone Qatar, SWOT is critical in accessing the challenges that it faces and the opportunities that it can exploit. Weaknesses Vodafone has some flaws that warrant consideration and appropriate strategies developed to overcome them. Sutherland (2011) identifies that Vodafone Qatar has weak internal processes. He opines that its internal processes may affect the overall profitability of the Company. Further, the Corporation has poor after sale services that may negatively influence its customer base. It has exorbitant tariffs in comparison to other internet providers. Similarly, the weaknesses of the business in Qatar compared to Europe also prove to be a major challenge. Given that eighty percent of Vodafone Corporation’s business runs in Europe also presents a challenge to the overall performance of Vodafone Qatar due to the unfavorable foreign commerce climate. The Company also has small average customer handling time, inability to build a strong brand, lack of product market expansion and few quality options. These weaknesses can influence the overall performance of the Corporation negatively. Threats New entrants such as the partnership between Qtel and Virgin Mobile aimed at combining the coverage and call quality benefits Qtel’s mobile network with the unique brand experience brought about by Virgin Group. On the other hand, this threatens the performance of Vodafone Qatar. Further, high market competition and radical players in the industry such as Qtel characterize Qatar mobile market, this present threat to the well-being and overall performance of Vodafone Qatar. Further, Whalley and Curwen have described the influx of digital music transfer in Qatar as presenting a threat to the growth of the Company (2013). Strengths Mazzarol and Soutar (2012) view Vodafone Qatar as boosting of an efficient network infrastructure. The Company has built a fiber backbone network with the capacity of delivering super-fast data speeds and flawless call quality to home and business consumers. Further, Vodafone Qatar offers loyalty bonus to its customers. It equally boasts of a skilled and expert workforce. The Company has an innovative staff base with high acumen and ingenuity. Similarly, it has low labor turnover and boasts of a diverse geographical portfolio with robust mobile telecommunication in Qatar. These strengths collectively give the company a competitive edge over its transnational competitors as noted by Sutherland (2011). Opportunities Vodafone Qatar can take advantage of its global presence given its subsidiary presence in most parts of the globe. Further, given that segmented market targets most of its products; the Company can utilize this to their advantage. Similarly, the stable democracy in Qatar, unlike most Middle East Nations, is presented by Oshri and Van Uhm as availing an opportunity for continued expansion of Vodafone Qatar (2012). Qatar has a stable democracy and peace that attracts more investors to invest in the market. The focus of reduction of cost to improve returns presents an opportunity that the Company can exploit to enhance its overall performance and profitability. Research and Development of new and state of the art mobile technologies are equally a chance that Vodafone Qatar can utilize to have a competitive edge over its competitors. Conclusion In conclusion, it is clear that Vodafone Qatar significantly undertakes Corporate Social Responsibility. It has heavily invested in CSR through which it has managed to empower people within the borders of Qatar and beyond. The Company’s involvement in CSR has resulted in increased performance since its customer view it as being a part of their society. Further, the CSR projects have increased shareholders’ value. Therefore, it is apparent that Vodafone Qatar’s increased overall performance and preference by the government are due to tireless efforts towards improving the community through its numerous CSR initiatives. Further, investigation of the business ethics of Vodafone Qatar through discussing the theories of companies about its employees, consumers and government reveal the importance of all these stakeholders. 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