Vodafones Capabilities and Core Competencies - Case Study Example

Table of Contents Introduction 2 Vodafone’s capabilities and core competencies 2 Vodafone’s generic competitive strategy 7 Vodafone’s pre-acquisition rationale and post-acquisition integration approach 9 Vodafone’s international strategy 12 Conclusion 14 Introduction This paper looks at examining Vodafone’s overall capabilities by examining the value chain analysis of Vodafone which will help to find out their capabilities and core competencies which acts as a key success point for the organization. The paper will then look at evaluating the generic competitive strategy which has been adopted by Vodafone so that a framework regarding the manner decisions are taken can be understood. This will be followed by identifying the pre-acquisition rationale and post-acquisition integration approach and the international strategy which has been adopted by Vodafone. This will thereby help to highlight on the performance and will develop the required parameters and tools through which success can be determined over a longer period of time. Vodafone’s capabilities and core competencies The identification of Vodafone’s capabilities and core competencies which act as a key success point in the performance on Vodafone is largely dependent on the value chain analysis. The value chain analysis looks towards identifying the primary and supporting activities which are carried within the organization and prescribes the different dimensions through which operational efficiency is gained. The Value Chain Analysis for Vodafone is as Primary Activities: This is the main activity which the company is engaged in and having a strong control over the primary activities determines the manner in which the long term prospect will be shaped. The primary activities are further divided into smaller sub parts where each part highlights the different dimensions which needs to be worked on and is as Inbound Logistics: Vodafone has developed its inbound logistics by developing its own network equipments which acts as a backbone while looking to provide cellular services. Having their own network equipments has provided the opportunity to provide different communication services which has helped the telecom provider to be effective in their operations. This is matched by the fact that Vodafone has also launched its own handsets which has reduced the reliance on other players as people can use the handsets provided by Vodafone and based on it use the network. To ensure better customer satisfaction Vodafone has its own spectrum which thereby provides an opportunity to carry out the information between the customers’ handsets and mobile masts. This has helped Vodafone to be able to bring transformation in the telecom industry and has provided an opportunity through which maximum people can be reached due to their network operations. Operations: The entire operations for Vodafone are carried out due to the infrastructure which it has developed and takes place in house. The manner in which operations of Vodafone is carried out is largely dependent on the people, infrastructure and the financials which has been used for different avenues. The operations of its logistics has further evolved from the different dimensions of service which Vodafone provides and looks at strengthening the overall mechanism so that better customer services can be provided. Out Bound Logistics: The outbound logistics for Vodafone consists of its on line purchasing system which provides the customer to purchase the different products directly through their websites. The availability of multiple options and online presence has made Vodafone to evolve and develop its outbound operations so that customers are provided with better services. In addition to it Vodafone has also developed their call center which comes in direct contact with the customers so that the different complaints or issues which the customers have can be solved. The call centre acts as a liaison between the outbound and inbound logistics system which has thereby helped Vodafone to bring a change in the manner different services are provided. Marketing & Sales: Vodafone for its marketing needs and requirements have developed their own exclusive outlets where the different Vodafone products can be easily procured. This has been matched by the fact that the retail chain distribution network which is in existence is being used to ensure better penetration of its products and services. The business also spends heavily on marketing and has taken an aggressive attitude towards the same. The association with different brand personalities and sports has also helped them to fulfill their marketing needs. The overall framework of Vodafone has been developed in such a manner that it looks towards maximum penetration and development of policies which will help to satisfy the different needs and ensure better association and remembrance of the product. Services: To develop its service and to ensure better customer satisfaction Vodafone has developed its business where they look towards gathering regular feedback from the customers through their websites or other social networking sites. This has helped Vodafone to work on the different needs of the customers an has thereby strengthened the process of providing services. addition to it Vodafone has also developed their call center which comes in direct contact with the customers so that the different complaints or issues which the customers have can be solved. The call centre acts as a liaison between the outbound and inbound logistics system which has thereby helped Vodafone to bring a change in the manner different services are provided. Support Activities: These are the secondary activities which are carried apart from the primary activities and helps Vodafone to carry out their primary activities in the most effective manner. The complete description of the support activities which have been carried out Vodafone is as Infrastructure: Vodafone has developed its infrastructure by developing its own network equipments which acts as a backbone while looking to provide cellular services. Having their own network equipments has provided the opportunity to provide different communication services which has helped the telecom provider to be effective in their operations. This is matched by the fact that Vodafone has also launched its own handsets which has reduced the reliance on other players as people can use the handsets provided by Vodafone and based on it use the network. To ensure better customer satisfaction Vodafone has its own spectrum which thereby provides an opportunity to carry out the information between the customers’ handsets and mobile masts. Human Resource Management: Vodafone is largely dependent on its employees to provide quality services so that customer’s different needs and requirements can be easily satisfied. The working environment has been developed in such a manner that it looks at innovation, ambition and pro-activeness. This has helped them to provide the required training and hire the best employees so that the different functions can be easily carried out. Technology & Development: Vodafone has used technology by developing their own portals which helps people to purchase the different products online. This has provided an opportunity through which continuous research is being done to improve the quality of service and develop standards which will help them to carry out the different activities in the most effective manner. Procurement: Vodafone for its procurement policies looks at using the network of other service providers at areas where Vodafone is unavailable. This is in addition to the fact that other handsets are also available which is compatible with Vodafone providing an opportunity to carry out the different functions in the most effective manner. The analysis of the Value Chain for Vodafone helps to find out the different dimensions and areas through which Vodafone can further improve their business and ensure a better platform for its further operations. This has thereby helped to identify the core capabilities and competencies which Vodafone depicts to be as Vodafone has a strong resource base which includes both tangible and intangible resources which has thereby enabled them to develop their business in a most proficient manner. Vodafone has a strong financial resource base which has helped them to carry out the different operations effectively. This has also helped Vodafone to develop its research and development process through which better and effective results have been achieved. This has helped Vodafone to develop its different core skills and has provided the fundamentals through which the different financial needs are met. Vodafone other core competency lies in the development of wireless standards which allows voice and data transfer through the same wireless network. This has helped them to be innovative and develop their service standards through which the overall business process effectiveness has improved. Vodafone other core competency lies in the human resource network which they have developed. This has helped them to develop employer brand and allows them to come in contact with people all around the globe. This has been matched by the fact that the corporate culture has been shaped and developed in such a manner that it has reflected on the overall development of the business in all directions. The different competitive advantage which Vodafone depicts based on its value chain analysis helps to highlight the different areas and dimensions through which Vodafone has been able to develop their business and brings about a complete change in the manner different activities are carried out. The overall success of Vodafone based on the value chain analysis and core competencies can be identified and attributed to the following key success factors. The key success factors have contributed positively towards shaping the performance of the business. Some of the key success factors which has helped them to grow their business is Continuous innovation and research has helped them to come up with new technology and developments which has helped them to develop a culture through which better effectiveness and control has been exercised in the different fields. Strong human resource department and employees who are innovative and enthusiastic has helped Vodafone to bring a complete change and turnarounds in the manner different activities are carried out. This has helped them to provide quality service and has developed the workforce in such a manner that the overall effectiveness has been shaped up. Vodafone has thereby been able to find out their core competencies and key success factors which contribute towards the long term success of the organization. This has helped Vodafone to identify the key areas and develop appropriate strategies which has impacted them in a positive manner and has helped them to develop their overall business fundamentals through it. Vodafone’s generic competitive strategy The generic competitive strategy which Vodafone has looked towards using has helped them to position themselves properly in the market. The analysis of the generic strategy helps to determine whether the business is a differentiator or cost leader or a focus player which thereby helps to provide the leverage for the business. This helps the business to develop the mechanism through which their long term strategies will be shaped and determined so that the overall success of the business can be improved. The generic competitive strategy which has been identified for Vodafone is as Cost Leadership: It is a strategy where organizations look at being the lowest cost provider in the industry and looks towards setting example so that others within the industry follow it. In a competitive market an organization with a low cost is able to earn high profits as the market price is determined by competitiveness and the profits largely depend on the cost involved. Vodafone has looked towards being a low cost provider as they look to provide different services at lower cost. Vodafone has developed their different plans and needs accordingly where they look at satisfying the different section of the customers by providing different services. Vodafone has looked at reducing the prices it charges for the different services and looks to provide communication services which include both data and voice at the lowest cost possible. This has thereby helped to develop the required framework through which cost effectiveness has been ensured. Being working as a cost leader and having the lowest cost due to possession of network and spectrum has helped them to provide different services at lowest cost possible. The strategy of Vodafone thereby has been developed on the policy of cost leadership and aiming towards developing the overall framework for better services. Differentiation: It is a strategy where the business looks towards differentiating its products or services from others in the market by focusing on special services. This at times results in situation where the business charges a premium for the different services which they offer. The differentiation strategy which the business adopts usually results in higher cost for the business. Vodafone has looked at working towards a differentiation strategy where they look to provide every section of the society with something different. The strategy of Vodafone has been developed based on the niche market which they are targeting. Since, Vodafone provides an opportunity to have different products for different customers even at a slightly higher price thereby ensuring a policy of differentiation it has provided an opportunity where they have been able to target a huge customer base. The overall framework has thereby looked at working on the different dimensions and looking towards a differentiation strategy so that better market presence and positioning can be achieved. Research & Development: Continuous innovation and research has helped them to come up with new technology and developments which has helped them to develop a culture through which better effectiveness and control has been exercised in the different fields. Strong human resource department and employees who are innovative and enthusiastic has helped Vodafone to bring a complete change and turnarounds in the manner different activities are carried out. This has helped them to provide quality service and has developed the workforce in such a manner that the overall effectiveness has been shaped up. Vodafone generic strategy lies in the human resource network which they have developed. This has helped them to develop employer brand and allows them to come in contact with people all around the globe. This has been matched by the fact that the corporate culture has been shaped and developed in such a manner that it has reflected on the overall development of the business in all directions Vodafone has thereby developed their generic strategy where they look towards being a cost leader and a differentiator. The strategy has helped Vodafone to position its products and services differently and provided an opportunity through which they are able to target the different niche market. The overall framework has thereby been such that Vodafone positioning strategy has been developed on different dimensions and has evolved the market through which better customer satisfaction has become possible. Vodafone’s pre-acquisition rationale and post-acquisition integration approach Vodafone’s acquisition strategy has been developed and shaped in the manner which will provide them maximum advantage and the acquisition model which has been developed looks at consolidating the business position. Vodafone while pursuing with the acquisition model has ensured that their business model doesn’t get impacted the business which will be acquired matches with the business needs and requirements. This has thereby helped to bring a complete change and has developed the different parameters which have shaped the acquisition model which Vodafone has adopted. Pre-Acquisition Rationale: Vodafone before acquiring any organization carries out intense ground work to find out the manner in which their business will gain due to the acquisition. Vodafone looks at acquiring organization which works in the same field and will help to create the required synergy so that the business is able to gain through it. Vodafone after searching for the relevant information which will add value to their working style selects organizations through which overall operational gains will be increased. Vodafone ensures that the business which is selected is one which matches with the needs and requirements of Vodafone. Based on it Vodafone develops its strategies so that they are able to use the already developed network of the acquirer. This provides an opportunity where Vodafone due to their brand name is able to penetrate in the market in a deeper way. This provides an opportunity where Vodafone is able to use the developed network to grow their business The pre-acquisition strategy which Vodafone selects has been based on it as it looks to acquire the partners who already have the required infrastructure and can support the development of the business easily. This provides the required framework through which Vodafone is able to acquire correct business partners so that positive synergy is developed. This helps to bring a change in the manner business works and develops the required parameters through which overall growth is seen. Vodafone in addition to it looks to find out the value based on which the organization will be acquired and based on the different fundamentals and infrastructure which the business will support decides the manner in which acquisition will be carried out. Vodafone before acquiring the company also carries out the valuation process which helps them to find out the correct price of the acquiring company. Vodafone ensures that the business which is selected is one which matches with the needs and requirements of Vodafone. Based on it Vodafone develops its strategies so that they are able to use the already developed network of the acquirer. This provides an opportunity where Vodafone due to their brand name is able to penetrate in the market in a deeper way. This provides an opportunity where Vodafone is able to use the developed network to grow their business. This thereby ensures that the process of bid provides correct valuation and Vodafone is able to find out the price where acquiring the organization will be better. Another important determinant of the pre-acquisition strategy which Vodafone looks to follow is that it looks at acquiring companies which have a presence in other markets and have the required resources. This provides an advantage as the same resources can be sued by Vodafone and the organization doesn’t have to undergo the process of developing the required network. This is matched by the fact that Vodafone further looks at ensuring that the acquiring strategy looks at organization which will generate synergy and crate a positive impact on the share prices. This has thereby helped Vodafone to ensure that the acquisition strategy helps to provide positive synergy and thereby brings about a change in the manner different business model is developed. Post-acquisition Rationale: Vodafone after acquiring the company for which it has bid looks at ensuring that the employees, infrastructure and other aspects are used. Vodafone looks towards using the same infrastructure which the acquirer provides and thereby helps to save on the effort of developing business. Vodafone in addition to it also looks at developing the framework through which they use the same employees which are already working. This is matched by the fact that Vodafone further looks at ensuring that the acquiring strategy looks at organization which will generate synergy and crate a positive impact on the share prices. This has thereby helped Vodafone to ensure that the acquisition strategy helps to provide positive synergy and thereby brings about a change in the manner different business model is developed, This has thereby helped to ensure that Vodafone doesn’t faces any legal or human resource issues which thereby helps to develop the required parameters through which better decisions can be taken. Vodafone has also ensured that the post acquisition strategy looks at working on the same business fundamental where they already have been working. This has thereby created the required opportunity through which organization has been able to formulate strategies where the business has been able to grow. The overall fundamental has thereby generated positive synergy and has helped the business to be able to work on the same fundamentals so that business opportunities multiply. This has developed the required fundamentals through which Vodafone has been able to use the already available resources and has transformed the business based on it. Vodafone post acquisition strategy further looks at developing the fundamental through which the different resources which the business has is being used in the positive direction. This has helped to generate the require fundamental through which better returns have been achieved. Vodafone further integrates the management under a common head and ensures that all the different departments continue to work on the same business model. Integrating the business on the same fundamental has created the required dimensions through which different developments have taken place and has created the required scope through which business has been able to grow. The overall relevance has thereby increased the overall scope of carrying out business and has multiplied the opportunities through which business effectiveness have been achieved. The acquisition strategy which Vodafone has been able to generate has ensured that the business fundamentals has grown through different stages and has thereby ensured better growth opportunities. The strategy of Vodafone inclines with the different needs and requirements of the business fundamentals and has thereby increased the scope through which better decisions are taken. This has strengthened Vodafone positioning and has brought about a change in the manner business works thereby creating the required leverage which has added positive synergy. Vodafone post acquisition strategy further looks at developing the fundamental through which the different resources which the business has is being used in the positive direction. This has helped to generate the require fundamental through which better returns have been achieved. Vodafone further integrates the management under a common head and ensures that all the different departments continue to work on the same business model. Integrating the business on the same fundamental has created the required dimensions through which different developments has taken place. The overall impact has been strong and has helped Vodafone to change the business momentum through which business returns have increased over a period of time. This has thereby brought about a change in the business fundamentals which has thereby developed the business and has ensured that the business opportunities multiply and the business will be able to gain from it. Vodafone’s international strategy While looking towards international expansion and growth companies make strategies in accordance to market to enter, timing, product which has to be sold and the entry mode which will be used. The different market entry modes which is used by businesses includes porting, franchising, foreign direct investment, international joint ventures and wholly owned subsidiaries. Vodafone has successfully used the different modes but the major concentration will be on acquisition and joint ventures which has helped Vodafone to grow. An acquisition is a strategy where a firm acquires another company in an intended market where as joint venture is one where two or more firms combine to form a single organization. Vodafone has worked on the philosophy of acquisition while working in the international arena which has helped them to consolidate their position in the market. The internationalization model also depicts the fact that global expansion is a learning process where when firm experience starts to grow the stability in the international market starts to grow. This has helped Vodafone to act as a pioneer in developing different strategies which are aimed towards maximizing the overall gains and has been able to deal with the different needs in a better way. Vodafone while looking to develop their international strategy has looked towards having a proper match between the global integration and local responsiveness process which has helped them to strengthen their business model. Vodafone which operates in different countries has thereby used the I-R framework so that the different needs of the market can be ensured based on the market requirements. This has thereby been an aspect which Vodafone has started to work on and has developed their international strategy based on it. Vodafone strategy further looks at developing the fundamental through which the different resources which the business has is being used in the positive direction. This has helped to generate the require fundamental through which better returns have been achieved. Vodafone further integrates the management under a common head and ensures that all the different departments continue to work on the same business model. Integrating the business on the same fundamental has created the required dimensions through which different developments Vodafone is now looking to move from global strategy to transnational strategy because they ignored the local responsiveness and lost market share due to the international strategy which has been adopted by the business. The movement towards the transnational approach will provide a framework through which better responsiveness will be gathered and the mechanism through which better opportunities of growth can be ensured. The transnational strategy will help Vodafone to satisfy both the local and global responsiveness and will ensure better integration of different factors so that the results which are achieved will be better. This strategy which has been used acts as a cost pressure and local responsiveness through which the development of the country and globalization aspect has been properly integrated. This approach has provided the required flexibility that Vodafone was looking for and has provided the opportunity to make different adjustments. The situation has provided an opportunity for Vodafone to make higher profits at places where cost reduction pressure is not high and Vodafone has been able to increase prices. The integration of local and global responsiveness has provided better integration and ensured that the overall framework to work in the international arena has been developed. The business as a result has become more effective and the different developments have taken place in different directions. This signifies that business being able to achieve their operational efficiency is able to improve the overall performance and ensure a process of even achieving the difficult task. Vodafone through the process of multiple approach has been able to integrate the different needs and requirements of the global environment. This has helped Vodafone to be able to perform in a better way and has created the required room and scope through which overall development and changes have become possible. The overall framework has strengthened the manner in which Vodafone works in the international marketing and the strategies developed strengthens the manner in which different business works. Vodafone further integrates the management under a common head and ensures that all the different departments continue to work on the same business model. Integrating the business on the same fundamental has created the required dimensions through which different developments. The different dimensions have thereby been developed to bring a change in the working style and ensure that the overall process maximizes the gains and effectiveness of decision making. Conclusion This paper examines Vodafone’s overall capabilities by examining the value chain analysis of Vodafone which will help to find out their capabilities and core competencies which acts as a key success point for the organization. The paper will then look at evaluating the generic competitive strategy which has been adopted by Vodafone so that a framework regarding the manner decisions are taken can be understood. Vodafone further integrates the management under a common head and ensures that all the different departments continue to work on the same business model. Integrating the business on the same fundamental has created the required dimensions through which different developments has been made. The identification of different dimensions has helped to understand the overall framework through which better results have been achieved and the business has been able to transform its business. This will be followed by identifying the pre-acquisition rationale and post-acquisition integration approach and the international strategy which has been adopted by Vodafone. This will thereby help to highlight on the performance and will develop the required parameters and tools through which success can be determined over a longer period of time. Read More