International Business Environment of Telefnica - Essay Example

O2 PLC: Management Every company understands the impact that the microenvironment plays in the realisation of its goals. The business requires directplanning that will shelter the business operations from any failures and utilise the macro-environment factors towards the success of its ventures. Telefónica (trading as O2) UK limited understands this very well because the communications industry is quite competitive to remain unconcerned. The customers require personalised attention, the employees need to be motivated enough, the shareholders need to see the progress of the company, and the suppliers need to be assured of their position in the whole supply management chain. This means that Telefónica has to major in various aspects that will see it grow (Matsumoto, Umeda, Masui and Fukushige 2012:57). O2 understands the impact that customer needs have on the growth and success of the company. Over the past five years, the company has been looking for different ways of building resilience in the provision of critical national infrastructure in accordance with the ISO 22301 guidelines (Kelion 2013). The important aspect, as noted by the company is to work on safeguarding the interests of the customers by establishing strong staff welfare policies. This assures them that the employees are satisfied and can serve the clients with confidence. They have established mechanisms to assist in the faster recovery of any critical disruptions that affect clients wherever they are. This allows the company to maintain a good rapport with the employees and clients as much as possible. Further, it increases customer confidence and reassures them of its zeal towards the realisation of successful operations (Matsumoto, Umeda, Masui and Fukushige 2012:57). The company is also working hard to ensure that shareholders recognise the business’s resiliency in the highly competitive market. The industry is quite competitive and they wanted to have as many investors in their corner. They have changed their strategies to accommodate the different shareholder attributes that will in turn increase the profits the company needs most (Kelion 2013). To deal with the competitors, the company has made good use of its strategic position within the UK to serve its more than 23 million customers. The 3G network is one of its unique selling points in the UK that has added 84% of the UK population to its list of customers. It has been able to work on different technology versions that have made it easy to supply the customers with faster 3G speeds (O2 2015). This has made it easier to beat the competitors and continue serving even more clients. By 2017, the company is looking at rolling 4G coverage to more than 98% of the population, aiming at beating its competitors in having the biggest reach within the country. The company is investing close to £1.5 million a day as a way of beating competitors and using the strong network and supply networks available. This allows the company to make good use of its resources and good relations with suppliers to keep its clients loyal (O2 2015). Macro Environment The macro environment is continually dictating the way the company runs its activities. For a long time, the goal has been to remain relevant in the country and continue gaining as many subscribers as possible. Loyal clientele are hard to find and the competitive environment means making sure that the products are beyond reproach. The purchasing power of the customers is one avenue the company is looking at paying close attention to as a way of enhancing its reach to various demographics. The economic activities and crisis affecting the country determine the sales and revenue accrued by the company. In the last five years, the company has sought to adjust its products to fit every cadre and allow as many customers to enjoy its services (Matsumoto, Umeda, Masui and Fukushige 2012:55). It is important to also consider the culture that is slowly emerging from the continued advancement in technology and the best means of securing the clients from any potential harm. Further, the advancing technology has in the past five years many services obsolete, but the company is looking for innovative ways of keeping its products afloat in the telecommunications industry. These services aim at taking advantage of the different ages in the society as a way of tailoring the products towards these needs (Cherunilam 2007:85). Dealing with the Micro and Macro Environments The company has been progressing in the past five years towards being the best company in the UK. It has managed to set its services and products apart from its competitors by remaining focused on the future developments expected to influence the technology industry. The important part is to understand that the growth of the company depends on its strategic alliance with potential partners who will assist it push through with its goals. It has planned to roll out 4G coverage across the UK, and that puts into perspective its customers, shareholders, competitors, economic changes, political and cultural changes. It wants to set the pace that others will follow, giving it the marketing mileage it needs (O2 2015). This will also shape the cultural attributes within the society, allowing it to take into consideration the impact that discounts would have in meeting the goals of its clients. The announce meant of having free Wi-Fi offered at its shops and central London was a good marketing gimmick that allowed it to attract as many clients as possible to its shops, getting an opportunity to advertise its products and even make sales (BBC 2012). This marketing campaign took many competitors by surprise, and earned O2 a chance to maximise its potential. This has allowed the company to make good use of its resources and achieve as much revenue as it can from all its clients. Opportunities There is so much opportunity in the UK and elsewhere because of the advancements taking place. The growth of the society and the continued increase in the use of technology has made it easier to access the vital market for its continued rollout of its services to the country. The fact that the 4G coverage on LTE is currently active means the company has many opportunities that place it at the top of the chart when it comes to having the largest coverage in the country. The awarding of the 800MHz band spectrum in 2013 was a good investment venture because it opened room for improvement in the provision of internet services across the UK (Kelion 2013). One challenge or threat the company faces is the declining purchasing power amongst most of the UK population. This hinders its achievement of its targeted amounts, and that means there is need to work on cutting on operational costs to shield the company and investors from losses. The important part is also to redirect revenues to other potential areas that could earn the company more revenue such as the R&D sector and come up with new ways of dealing with the declining revenues (Fernando 2011:33). With the increasing costs of operations, the employees may also not get full benefits because the company could be forced to cut some of them and use the money for developmental purposes. As such, the company can also decide to follow Google and Microsoft’s example of using the employees as the source of innovation. The 20,000 plus employees have ideas that could earn the company millions of money in revenue. Making good use of them will earn the company loyal clients, satisfied employees, and expanding company services (Matsumoto, Umeda, Masui and Fukushige 2012:57). The board can also look into acquiring companies that will assist in diversification of products and services to the rest of the country (Cherunilam 2007:89). The more the franchises are, the better for the company’s continued existence. The advancing technology is full of opportunities the company can take advantage of, and that will determine its growth rate and the rate of achieving its goals. References BBC. (2012) Europes biggest free wi-fi zone set for London, viewed January 13, 2015 from . Cherunilam, F. (2007) International Business: Text and Cases, London: PHI Learning Pvt. Ltd. Fernando, A.C. (2011) Business Environment, Mumbai: Pearson Education India Kelion, L. (2013) O2 4G mobile network launch date announced for the UK, viewed January 13, 2015 from . Matsumoto, M. Umeda, Y., Masui, K. & Fukushige, S. (2012) Design for Innovative Value Towards a Sustainable Society: Proceedings of EcoDesign 2011: 7th International Symposium on Environmentally Conscious Design and Inverse Manufacturing, New York: Springer Science & Business Media. O2. (2015). Our Network. Viewed January 13, 2015 from . Read More