Answer To: MGT302A/BIZ303_Assessment 2 Brief_ Case Study Report Page 1 of 6 ASSESSMENT BRIEF Subject Code and...
Sarabjeet answered on Aug 01 2020
Running head: Telstra Strategic Management
Telstra Strategic Management
Telstra Strategic Management
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University Name
Contents
Introduction 2
2. Evaluating the organization’s environment 2
Porter Analysis 2
PESTLE Analysis 4
b. Internal - use core competencies and value chain analysis. 4
3. Analysis of competitive advantage 6
a. Competitive rivalry 6
4. Strategy formulation and choice (550 words) 7
a. Vision 7
b. Goals 7
c. Initiatives – cost leadership vs differentiation 7
5. Recommendations and conclusions 9
a. With rationale for support of strategy 9
b. With rationale for critique of strategy 9
Conclusion 10
Introduction
Telstra Corporation is Australia's one of the biggest telecommunications company. Telstra was effectively privatized in 2011 and become the Australia’s largest company listed in the Australian Stock Exchange, with more than 1 million shareholders. Telstra is as large as the 36,165 employees and its motto is "Thrive On." The company not only operates in Australia but also operates in 22 other countries outside Australia. The company's main products and services include web services, landline and mobile connectivity, internet and data services, and digital TV. According to 2015 data, the company's revenue is AUD$26.7 billion. Telstra's main market is home and business customers. The business scope continues to grow internationally and companies are taking the opportunity to increase their market share in the global market.
2. Evaluating the organization’s environment
Porter Analysis
Porter’s Five Forces
Intensity
Analysis
Bargaining power of customers
Medium
The organization has a large number of buyers. Telecom network providers don't have much products differentiation which results in low customer switching costs and they can effortlessly switch from one to another service provider. Customers can switch by price. On the other hand, the conversion depends completely on the coverage and quality of the service network and it is a major concern for buyers (Ahmad, Hussain, & Rajput, 2015).
Bargaining power of suppliers
Low
Telstra is one of the largest network providers in the telecommunications industry. Partners and Suppliers are an important part of Telstra. It has great control over the network capacity moreover can manage business markets in different countries. They use their own individual network cabling (Reichert, 2018). The quality of the products sold by the company helps to win the trust of customers.
Intensity of competitive rivalry
Medium
Optus and Vodafone are Telstra's main competitors. However, Telstra still dominates the telecommunications market. They also expanded its presence in Asia, which is exploring opportunities to participate in the international market. Few competitors are capable to maintain the market due to product differentiation and low quality of service.
Threat of substitutes
Low
The user base for accessing networks and services is increasing. Communication and Internet facilities are irreplaceable. As technology and social trends continue to increase, it seems that there is no choice but the Internet is everyone’s choice.
Barriers to entry
Low
Telstra has strong R&D and technological advancements in the telecommunications industry. In order to compete with Telstra, new entrants require a lot of setup costs.
PESTLE Analysis
Economic factors: Telstra Corporation Limited can use the country's economic or financial factors, such as inflation, growth rates, and industry economic indicators, like telecommunications service industry growth rates, consumer spending, and so on to predict not only the industry but also the growth trajectory of industry organizations (Carmody, 2016).
Technical factors: Nowadays technology is rapidly disrupting industries. Because of the rapid changes happening in wired and wireless carriers technology, there is always room for technical progress. In order to maintain the industry and provide a comprehensive digital environment for telecom companies, it is necessary to monetize their infrastructure investment. To send experience-based offerings, it is necessary to try to promote data-intensive content and exit the unrestricted program. Telecom companies need to develop new 5G systems and deploy 4G systems.
b. Internal - use core competencies and value chain analysis.
Core competitiveness
To analyze the internal environment of the organization there is a need to assess the organizational strengths, capabilities, as well as resources that enhance Telstra's internal environment. Some of Telstra's key capabilities and resources are a strong international presence, a strong customer base, innovation, strong finance, and marketing, and a broad product portfolio. According to reports, Telstra has a wealth of core competencies and resources. Telstra have to add value to its activities they carry out. Product portfolio has to be strengthened to show fierce competition in the global marketplace. In addition to the product portfolio, Telstra has a continuing competitive advantage in every aspect.
Value chain analysis
Value chain analysis is a series of activities of a company operating in particular industry. All the activities are separated into several categories: primary activities plus support activities. Main activities include functions of the organization and provide a competitive advantage for the companies it operates and support activities simply add significance...