Operational Activity of the Brand O2 - Case Study Example

? Telefonica UK Limited Introduction: Background Information Telefonica UK Limited is the internet, telecommunications and financial service providerproviding services to a large range of customers in United Kingdom. The organization is owned by Telefonica forming a part of Telefonica Europe (O2, 2013b). The company is renowned for being the second largest provider of telecommunication services in United Kingdom. The company is headquartered in Slough, United Kingdom. It was established in the year 1985 through the joint venture agreement between Securicor and BT Group. In the year 2002, the company had launched the brand O2 for the betterment of the business. The organization operates in more than 25 countries employing 264000 employees and serving almost 287 million customers. It helps in developing the client’s business by means of international advertising or telecommunication solutions. Ronan Dunne is the existing CEO of the organization. He has managed all his responsibilities in an efficient manner from his very first day of taking over the responsibilities from the previous CEO. He has succeeded in generating as well as maintaining consistency in earning high revenues. The company offers 2G, 3G and 4G services to the customers all over the country and also, in some parts of Europe. Along with its telecommunication services, the company is also known for providing fixed line services. The organization uses its name in its logo and portrays an image of an oxygen provider to its customers. O2 is also known for its charity purpose and has a tie up with a large number of charity groups. One of the examples is its tie up with Academy Music Group. Their partnership had resulted in the establishment of O2 academy. Current Research Operational Activity Digital communication serves as one of the fundamental parts for almost all the individuals in the world. In the developing as well as developed countries, the communication facility is developing at a fast rate along with the advancement of technology. In the present scenario, the cell phones are almost indispensible for all the individuals involved in mainstream activities. It has become one of the most important reasons for increasing the value of O2 from the global perspective. In 2012, there were approximately 82 million users who had subscribed to various mobile service providers. It has also been seen that the number of internet users have increased rapidly along with increasing mobile phone subscribers. The data traffic almost doubled itself in 2013 as compared to the previous year. In United Kingdom, there are a large number of players operating in this particular segment, O2 being one among them. The international market of the telecommunication services tends to be highly competitive with passage of time. It is mainly because of the rapid technological advancements, thereby resulting in the development of modern channels of communication. Xavier and Ypsilanti (2008) have argued that in this period of varying communication tools, implemented by the consumers as well as the marketers, the consumers reflect various motivational factors behind their purchasing services from a definite mobile service provider. Therefore, the companies operating in this industry are highly engaged in the diversified process of attracting the customers and retaining them by implementation of various effective business strategies. O2 uses the benefits of its global reach for standardizing the business all across the world by improving the cost efficiency and reducing the time involvement in launching new products and services for the customers. It has recently collaborated with Vodafone for operating as well as managing one single network grid in United Kingdom, which would be run by two most competing mobile internet networks. The joint collaboration of both the companies would offer indoor 2G and 3G, thereby covering 98 percent of the UK population within 2015 (Vodafone Group, 2013). Service Differentiation The customers as well as the competitors of every organization are working as well as communicating in different ways for fulfilling their own demands. The indigenous apps provided by smart phones, tablets and other means of social media have helped in making the business communication quicker and even more powerful. O2 differentiates its services in all the above mentioned fields. It provides sense to the business communication and helps it to flourish in the economy shaped by the social network, flexible working, apps and mobile technologies. It provides services such as: Apps: That is adapted or readymade. Network management and network security. Mobile WAN or LAN services. Mobile device management. Unified mobile networks, data and voice quality. The organization provides secure network which can easily adapt to the working patterns of the customers. The service providing includes simplified management where the users need not spend more time on understanding the technology and instead spend it for advancing their businesses (O2, 2013a). O2 also helps the customers in choosing the appropriate model of the product which would serve their purpose in the best possible manner. It helps the customers to opt for the business phone system, mobile devices or network solutions, which are required by them for being productive. It provides collaboration or conferencing solutions to the large business teams. It enables the mobile users to be in touch by providing products with advanced technology such as, tablets, smart phones, Wi-Fi and dongles. It differentiates its service offerings by unifying the business mobile, data networks and the landline services. The users are provided with facilities such as, low cost of ownership, ease of management and reliable network connection for supporting the businesses of the SMEs. O2 provides its customers with customer specified consulting services. The delivery of services to the clients or the customers is always done within the service hours (Telefonica UK Limited, 2013). However, while providing the consultancy services, the company takes into consideration that there is no unlawful access to the customer network. The employees of the organization remain engaged in their performance of providing consultancy services along with being under the control and directions of O2. Competition in the market Vodafone acts as the strongest competitor of O2 in the market. When 4G was launched by the Vodafone Company, there was hardly any company which could compete with it. But the arrival of 4G services by O2 has deepened the competition in the market, thereby making the market highly fragmented (O2, 2004). The company followed a pricing strategy which could easily attract the customers and act as a direct competitor of Vodafone. It has been found that a wide range of customers prefer using the service by O2 as it offers them a broad range of options (Gov, 2013). Main Customers of O2 O2 provides services to a large range of customers in United Kingdom. The organization has also planned for expanding its business operations by means of providing services in the SME market. It has started its operations in the SME market by launching a pilot store in London, targeting mainly the SME community (Mobile Magazine, 2011). The split level franchisee store in London has been built, specifically targeting the out of town and local SMEs. The store represents state of art in it, which attracts the targeted customers. The workshop is located at the basement level. This 4500 square feet store, the biggest one in the company’s estate, has been designed for the SME customers as well as other consumers. The ground floor has been renovated in the new store designing format with the most recent range of line devices and consulting area. The organization has targeted the SMEs in order to incur huge profit from the business operations in this market. Operational Issues This portion of the project would be reflecting the operational issues faced by the customers of O2 (mainly the SMEs), which have offended them to a great extent. One of the operational issues that reflected in the complaints of the customers was the failure to deliver the products on time. There were cases where the company had failed to deliver the product to its customer in the committed time period. When the customer had enquired on the untimely delivery, it was informed by the company that there was no recipient at the customer’s provided address, resulting in the failure of the product’s timely delivery. However, this information was totally untrue (Telefonica UK Limited, 2011). A series of similar circumstances have led to the dissatisfaction among the customers. There are a number of reasons behind this operational issue. O2 uses Kiosk, physical store and retail stores for delivering services to the SMEs as well as other customers. As already discussed above, the company has opened a store in London targeting the local or out of town SMEs. The location of the store has acted as a restraint for the in-town SMEs, thereby rising complaints from them. The Kiosk and the physical stores are located in the market place of the sub-urban areas. Thus, the SMEs located in the busy areas are beyond the reach of such stores. Moreover, there is staff shortage in the stores located in the rural areas or the busy places. At the same time, there is availability of adequate staff in the sub-urban areas. The company fails to utilize its human resource in an effective manner. The increasing customer demand in the busy market areas cannot be met by the staffs available in the stores in those areas. On the other hand, there are adequate human resources in the stores of sub-urban areas which are not required. Moreover, it has also been observed that the staff members in the busy areas lack adequate knowledge on technical grounds, which leads to delay in service delivery. This is a problem in the internal business management of the organization related to the recruitment and staffing structure. The staffing and recruitment is an important business process which determines the quality of the service offerings of an organization. In order to maintain a competitive edge, it is very important for an organization to acquire talented candidates within its system who can easily adapt to the working environment as well as the work culture. Moreover, there is also a problem in the outlay of the organization which delays the service offerings by them. The company has focused too much on the product or service differentiation, rather than focusing on the designing of the organizational structure that would help in providing organizational stability and increasing the organizational outcome. Hierarchical organizational structure has resulted in ineffective communication at all levels of management, thereby resulting in delay in the service offerings to the SMEs. The designing of the organizational structure is very important in order to provide services in an effective manner and satisfy the customers by meeting their demands on time (Schlumberger Business Consulting, 2013). The interrelation in between the organizational structure and the productivity of O2 would help its managers in focusing on the complexities of the departments such as, marketing department and production department. Proper designing and implementation of the organizational structure within O2’s business environment would have helped in the segmentation of different categories based on the functions and activities. There are a number of challenges faced by O2 because of this operational issue of delay in the delivery of services. It is increasing the grievances and level of dissatisfaction of the SMEs which can have a severe impact on the company’s business operations. This possesses a threat to the company related to the reduction in the business dealings between these SMEs and O2. This dissatisfaction among the customers has also resulted in the weakening of the market reputation of the organization. O2 requires taking important measures for improving the present scenario of its business operations. Conclusion The company is renowned for being the second largest provider of telecommunication services in United Kingdom. The company is headquartered in Slough, United Kingdom. Today, it serves one of the most important needs in the daily lives of the individuals as digital communication is the fundamental part of all them worldwide. In the developing as well as developed countries, the communication facility is rapidly evolving along with the advancement of technology. O2 differentiates its services in all the above mentioned fields of smart phones, tablets and other means of social media. O2 provides services to a large range of customers in United Kingdom. The organization has also planned for expanding its business operations by means of providing services in the SME market. The main issue arising out of the service delivery to these SMEs is the failure in the timely delivery of services. The reasons behind such an issue are problems in the outlay of the organization and the drawback in the recruitment and staffing structure of the organization. O2 requires solving the above problems and reducing the present challenges and issues in order to regain the confidence of its customers as well as the reputation in the global market. Recommendations The following recommendations have been provided to O2 for reducing the present problems and regaining back its original position in the global market: O2 should reduce the hierarchy within the organization for enhancing effective communication. The company should implement functional organizational structure for reducing the problems associated with it. It should increase the number of outlets in the busy areas to attract the in-town SMEs. O2 should plan for hiring more staffs in the outlets in the rural region in order to increase the efficiency in the service offerings in those regions. The organization should plan for improving the staffing system in order to select talented and experienced employees who would add value to it. Reference List Gov, 2013. Mobile Connectivity in England. [online] Available at: [Accessed 3 December 2013]. Mobile Magazine, 2011. O2 Trials New Store Aimed at SMEs. [online] Available at: [Accessed 3 December 2013]. O2, 2004. The Contribution of Mobile Phones to the UK Economy. [pdf] mmO2 plc. Available at: [Accessed 3 December 2013]. O2, 2013a. Business Solutions. [online] Available at: [Accessed 3 December 2013]. O2, 2013b. Our International Services. [online] Available at: [Accessed 3 December 2013]. Schlumberger Business Consulting, 2013. Organization Design. [online] Available at: [Accessed 3 December 2013]. Telefonica UK Limited, 2011. Yodel and O2 Delivery Problems. [online] Available at: [Accessed 3 December 2013]. Telefonica UK Limited, 2013. Consultancy Terms. [online] Available at: [Accessed 3 December 2013]. Vodafone Group, 2013. Operations 2015. [online] Available at: [Accessed 3 December 2013]. Xavier, P. and Ypsilanti, D., 2008. Switching costs and consumer behaviour: Implications for telecommunications regulation. Info, 10 (4), pp. 13 – 29. Read More