Vodafone Telecommunications Industry Analysis

This assignment aims to analyze the external environment factors influencing the telecommunications industry, focusing on Vodafone. It employs Porter's five forces model to evaluate competitiveness and the Bowman Strategic model to understand product standards and pricing strategies. The report explores Vodafone's customer-focused approach and its strategies for innovation and people development.

Business strategies

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
PESTLE model for environmental analysis................................................................................1
Ansoff’s growth vector matrix to analyse the organisation’s strategic positioning...................2
Task 2...............................................................................................................................................4
Explain what strategic capability means.....................................................................................4
VRIO/VRIN’ model to determine the strategic capabilities possessed by Vodafone company 5
Identify the organisation’s strengths and weaknesses.................................................................5
Task 3...............................................................................................................................................6
Evaluate the competitiveness of UK’s telecommunications sector using Porter’s five forces
model...........................................................................................................................................6
Task 4...............................................................................................................................................8
Bowman’s strategy clock model, analyse the strategic direction and options of Vodafone
industry .......................................................................................................................................8
Conclusion ......................................................................................................................................9
References.....................................................................................................................................11
Books and journals ...................................................................................................................11

INTRODUCTION
Vodafone is an UK based company, it is second largest mobile phone industry and it is
providing telecommunication services all over the world (Barney, 2012).This report can include
the impact and influence the macro environment of Vodafone organisation and also explaining
its business plan of action through pestle model and Ansoff's growth vector matrix. This report
can be included strategies capabilities and applying the VRIO model to determine the strategies
capabilities this industry and identifying the strength and weakness of this organisation.
According to this report analysing the telecommunication sector and understanding the strategic
direction through Bowman's strategy clock model of this corporation.
TASK 1
PESTLE model for environmental analysis
Pestle analysis is a strategical tools used to analyse external factors affecting the
organisation and it is refer with political, economical, social and technological factors of the
business. Vodafone PESTLE analysis.
 Political factors affecting Vodafone consider with European union Tramp Regulations
that main motive to modification charge for smart phones usages abroad by 70% and
increasing the level of customer right within Europe and all the decision made by EU
regulatory set the framework for the communication sector (Scholes, 2015 ).
Government intervention is also through legislation and this factors is very much
influential in the way of progress of the Vodafone telecommunication company like as it
ha to develop organisation infrastructure.
 Economical factors also affect this company its main growth of Gross domestic and the
level of rising prices within markets where the industry operates. The global economic
problems like global financial crisis are also affecting the this organisation. Moreover ,
the all over economical crisis the world has facing in recent times has also direct striking
on the this corporation.
 Social factors it is totally based on the local beliefs and culture of the people in which the
organisation is work. Vodafone also show their adaptability in its policies pertaining to
local culture, it is very dynamic and for the success of the business. This industry is
basically European and its policies as per the local social factor. Social factors consist
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with changing work patterns that are becoming very famous make UK group of people
work from home increasing relying in communication technologies.
 Technical factors the impact of this factor Vodafone is without any doubt due to the
nature of the telecommunication company. Particularly, a technology is the part of new
innovation in communication and emergence of alternatives means of communication
like as online chatting. Messenger are going to affect this organisation strategies in the
way of the industry is left with a choice other strategic alliances with other company
commit to considerable amount of research and improvement in order to introduces new
product and work in market.
 Legal factors Vodafone has face many disadvantage from the many times, this industry
has been not paying much their employees as compared to its rivals. This company stay
by the legal issued of the domain in order to increase their customer and maintain a
positive image in their market which will always help in generating the trust of the
consumers.
 Environmental factors it is related the working condition of the company must also be
better enough to attract the best of the individuals to be the part of the Vodafone industry.
This organisation has been highly changing in nature and it also maintain the market ,
expand their network, this organisation should always consider with the aforementioned
facts and analysis.
Ansoff’s growth vector matrix to analyse the organisation’s strategic positioning
Ansoff's growth matrix is related with the Ansoffs product market growth matrix. Its
shows the current product and current market strategy model of the business and also show the
current position of the company.
 Market penetration strategy of Vodafone industry it refer to the current product and
current markets its also focus is on selling their product in existing customer. Vodafone
also focus on accelerative their market share through with their marketing promotions,
more effective marketing and their strength. This company create more customer value
and main motive to attract their existing customer as well as new target customer through
effective advertising or quality of product and service provide their consumer. Market
penetration will increase comparative rivalries in this organisation and make significant
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increases their market share, this corporation must be willing to drive competitors out of
their market. This industry also exposure to one product market segment can make the
business more assailable on future.
 Product development is consider with need of current customer and understand the
customer need want. Vodafone focus on their replace existing product with something
better and providing complementary product their customer need to buy before, during or
after purchases of the main product sold by the company (Teece, 2013). This
organisation sells other product also the customer buys as a way to leverage the
relationship and provide better quality services. This industry main focus on their product
development they increasing their product quality and maintain the relationship between
target customers. They develop new product through using this matrix and it is very help
full for developing the new product and business can work with existing supplier they
established resource and capabilities offer them new routed to market.
 Market development it is consist with different ways like new marketing am distribution
channels this company disturbed their product all over the world the strength of
Vodafone industry their product services. The strategy of this company full fill their
customer demand and expand their business with effective services. This company want
to extend their business organization as much as they can to the youngster, matured
person, professional persons. This organisation have different prices package with
suitable to the every age group of consumer and these different packages are added the
value of customer satisfaction. This corporation is start offering monthly prices plan
packages and it also provide online top up facilities and this company also giving
NECTER benefits by using the test messages, sending pictures and many other thing.
 Diversification Vodafone is in a strong position to diversify their business this company
main aim to diversification their business product using exiting resource and capabilities
while the customer and product are different. This company focus on their modernization
of current network for long term and providing 4G services all over the world in 2016.
the current position of the company providing quality services to their customer and and
their business, improve their current mobile network in as effort to reduce dropped
phones calls.
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Task 2
Explain what strategic capability means
Strategic capabilities are know as a enterprise ability to successfully employee competing
strategies that allow to face and increase its value over time. Vodafone company strategies
capabilities is to grow through geographic expansion, acquisition of new consume, retention of
existing customers and increasing more usages through new innovation in technology. This
company business strategy to generating their profit as well improve the quality of services.
Giving the lot of opportunities in grow their business. This organisation purpose to identify and
focus on those areas where their interventions can address sustainability challenges are better at
same times as offering their shareholders. The capabilities of this industry depend on their
product, services and market. This company can also import their services, providing
development and also to environmental sustainability. This company identifies the conflicts of
interest and potential conflict and help to giving an over all picture.
Strategies capabilities of Vodafone company in remaining financially viable and
growing present competitors in a free market. This company include capitalist, who want to put
their currency into their business with reasonable chances of future success and growth.
Employees of this industry also care about the strategies capabilities since they identifying the
business need that are stable or not. This corporation assessing their strategic capabilities is a
complex process and also evaluating its business strategies capabilities is known as a strategic
value analysis. They implement all the those strategies which are in stable in their work for long
term.
Strategies capabilities are very important aspect for identifying the strength and weakness
of the business and helps to improve product qualities, customer services and developing
market strategies also. This company improve their effectiveness in supply chain and
additionally , organisation would be aware of the desire of the future market for the development
of new innovative products for magnetizing the consumer towards the brand.
VRIO/VRIN’ model to determine the strategic capabilities possessed by Vodafone company
VRIO model is very valuable it is related origin are seen as valuable when they enable a
industry to implement strategies that improve the business efficiency and powerfulness by
exploiting opportunities. Vodafone company resources can only acquiring by one few companies
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are considered to be rare and certain valuable resources is possessed by a large amount of players
in the organisation, every layer has capable to exploit the resources in the same way, therefore
complementing a common strategy that provide non of the player as competitive advantages.
Such a situation is indicated as competitive parity and in case this organisation does poses a large
amount of resources that are more valuable and rare, it is similarly to have at least temporary
competitive advantages. This method main focus resources themselves do not create any
advantages for this company if the Vodafone is not designed in way to adequately exploit these
resources and capture the value from them. It refer to the values, rareness, limitability and non-
substitutable of a business. The value of Vodafone resources that can convey the sources of
completive advantage and resources are available to all competitors rarely provide any
competitive in their market. An ideal resources can not be obtain by competing Vodafone
business and an ideal resource cannot also be substituted by any other resource.
Identify the organisation’s strengths and weaknesses
Vodafone is a brand known of its telecommunication industry across multiple nations
and countries. The strength of the company Vodafone is ranked 395 amongst the worlds top
2000 brands (Verbeke, 2013). Its distribution channel is also wide and large number of network
coverage. It is the second largest subscriber and the second highest ranked telecom operator that
means massive market coverage. This organisation generate billion of dollar of revenue every
year, recently in 2016 this organisation has generated a revenue 87.3 billion dollars the result of
this industry in boost the rank and expectations from Vodafone even promote their sales figures
across the global market. The main of this industry expand their business all over the world
through effective services with new innovation technology. While other telecom operators are
penetrating the market, this company is differentiating its services regularly. This organisation
also giving the premium cost out their customer and float in margin rather than other telecom
industry are struggling to maintain positive margin. The valuation of Vodafone is 28 billion
dollar. The brand equity of this firm is very high other companies and it is not easy that anyone
will not play in telecommunication industry.
The weaknesses of Vodafone company losing market share in USA where this company
could have demanded the premium it need to keep itself aimless. It also refereed with bad
performance in Europe and other economical conditions in Europe, this industry presentation in
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its home market has been very poor and it has not gain much more revenue from its local home
market (Bharadwaj and et.al, 2013). The major problem is consumer of this organisation facing
some time network coverage problems like Vodafone is known to have poor network coverage
many times. This is also the weaknesses of this company because of the number of tower are not
work proper or out of services. Some time customer are not satisfied with this company services
it is also the great weakness of the firm. The main weakness Vodafone has relates to it focused
on management system that cause inflexibility in market.
The strength and weakness of Vodafone industry analysis is a technological tools and it
is considered to be internal factors affecting this organisation, whereas threats and opportunities
are external factors. This company leadership position in the market can be considered with
strength of the firm possesses, because due to this fact the corporation is good position finance
new project and introduce new product services in the marker. This industry main motive to
identifying real strength and weakness of the business and focus on those area which are weak
and try to improve their services.
Task 3
Evaluate the competitiveness of UK’s telecommunications sector using Porter’s five forces
model
Bargaining power of purchaser the buyer in smart phones this industry these all-powerful
buyer can reduce the cost of leaders prices, but not past the level of their target competitors
(Cascio, 2018). This is sure Vodafone will continue to earn more profit at above return
compared to its near challenger. Buyer are frequently demanding their variety of product. They
want to buy the best qualities or offering at possible price. This put pressure on this company
group earn more profit for lon run business. This industry build up large number of customer it
will be help in two way like it reduce the bargaining power of the buyer plus it will give an
opportunity to this firm. New product will also reduces the defection of old customer of this
company group.
Bargaining power of suppliers it is related with all most the firm in the wireless communication
industry buy their raw material from various number of suppliers. Provider in dominant position
can decrease the amount of Vodafone group can earn in the market. The overall impact of higher
supplier bargaining power is that it lowers the overall profitability of wireless communication.
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This company can lineman bargaining power of the suppliers by building their supply chain
with many suppliers. They experiment with their product designs and using different material.
Threats of substitutes when Vodafone providing new product or services meet a similar
customer need in different way, so the company profitability face some problems like Dropbox
and google drive are substitute to storage hardware drives. This firm focus on their services
orienter rather rather than its product oriented and they understanding the core need of the
consumer rather than what the customer is buying and they increasing the cost of the product.
This forces is consist with customer to switch from a Vodafone business product or its service
and number of competitors compare their product prices and quality and examine the profit those
competitors are earning mower their cost even more. Yhe threat of substitutes are informed by
switching cost, both present and long term as well as buyers tendency to change.
Rivalry within the market Vodafone position as cost leader, its competitors have face
hard time competing on basis of prices because challenger will face more competition in
the market, it also relates with the value of industry and most value able contribution of
these forces. This force is the major determinant on Vodafone competitive and its
profitable an industry earn profit and have to compete sharply for a market share, which
result in low profits. This company rivalry many competitors in their marketplaces,
barriers are high and this company is slow, services are not different and low level of
customer loyalty. This forces examines how the competition are face in the market with
determined number of exiting competitors. Rivalry competition is high when the
Vodafone industry is growing and when customer can easily switch to a competitors
offering a small cost.
Task 4
Bowman’s strategy clock model, analyse the strategic direction and options of Vodafone
industry
Bowman Strategic model is recognised as a model which provides the several methods
or techniques which can be adopted by company for gaining the competitive advantage as well
as achieving good position in the market (Hoejmose and et.al, 2013). As per the Bowman’s
strategy clock model, there are mainly eight strategies which can be used by an organisation are
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main when planning to positioning their products or services in the market. According to the e
model proposed by Bowman’s, manager in an organisation should considered mainly two
elements such as price and perceived value when pricing or positioning the products. The several
strategies suggested by Bowman’s are :
Low price and added value-These types are generally not acceptable buy companies. The reason
that an organisation does not use this low price and low value strategy is that , it includes the
high level of the negotiations and provides bargaining power to customers. Firms generally avoid
negotiations with customers , as this factors have direct as well as significant impact on the
reputation of company and also on business performance. Business entity generally utilise these
strategies at the time when their product lacks differentiated value. An organisation can
implement this strategy through cost effectively selling volume, and by continually attracting
new customers. By adopting this strategy firm will not able to gain the loyalty of customers. Low
price and added value is considered to be value when an organisation want to increase its
sustainability in highly competitive environment.
Low price- Business entity can apply this strategy for selling their products or services. As this
will help an organisation in attracting more numbers of customers. By implementing low pricing
strategy an organisation can easily enter into new market and can achieve leading position in an
industry.
Hybrid -Companies with this type of strategy delivers higher perceived value as well as quality
products or services to customers at reasonable price to customers. Hybrid pricing strategy helps
business entity in increasing sales and generating the high revenue. In this strategy , volume of
products is considered to be a major issue (Spender, 2014).But by delivering the products or
services at reasonable price , company will able to gain the loyalty of customers. Hybrid strategy
also provide firm an opportunity to improve its brand reputation and allows an organisation to
gain popularity. It also helps an enterprise in developing as well as maintaining strong and long
term relationship with client.
Differentiation: An organisation with this type of strategy have focus on developing unique as
well as innovative product. Differentiation strategy assist an enterprise in differentiating itself
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from other companies in an industry(Higgins and et.al, 2015). This strategy helps an enterprise in
gaining the competitive advantage.
Focussed operation - Vodafone using the differentiation strategies do their best offer as a high
as possible quality at an lower prices(Reich, and et.al, 2013). They offer to their customer the
highest level perceiver added value. This company not only concrete on product quality, but
also on so called branding and reliable brand on their market that retain customer.
Increased price as well as standard product: Vodafone company main motive to increasing
their product price as well as standard of product through effective providing effective services
and quality of product according to customer demand (Kourdi, 2015). This company focus full
fill their customer demand at possible price and this organisation also focus on maintaining their
relationship with their target customer as well as existing customer
Conclusion
It can be concluded that the aim of this report analysis external environment factors of
telecommunication Vodafone industry. This company is very fast growing all over the world
and its main aim to expand their business and providing qualities of services and identifying the
strength and weeks of this industry it is very important aspects in telecommunication business
sectors. It also the evaluate the competitiveness of UK’s telecommunications sector with the
help of using Porter’s five
. These five porter are very useful for gathering the information and help to identifying the
business need and Bowman Strategic model is established as a model which provides the several
methods or techniques of this industry and giving the actual prices information and standard of
product. Vodafone organisation focus developing a competitive in market through effective
strategies for customer, innovation and people and making lot of opportunities in their business.
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References
Books and journals
Barney, J.B., 2012. Strategic factor markets: Expectations, luck, and business strategy.
Management science, 32(10), pp.1231-1241.
Scholes, M.S., 2015. Taxes and business strategy. Prentice Hall.
Teece, D.J., 2013. Business models, business strategy and innovation. Long range planning,
43(2-3), pp.172-194
Bharadwaj, and et.al, 2013. Digital business strategy: toward a next generation of insights.
Verbeke, A., 2013. International business strategy. Cambridge University Press.
Cascio, W., 2018. Managing human resources. McGraw-Hill Education.
Hoejmose, S., Brammer, S. and et.al, 2013. An empirical examination of the relationship
between business strategy and socially responsible supply chain management. International
Journal of Operations & Production Management, 33(5), pp.589-621.
Spender, J.C., 2014. Business strategy: Managing uncertainty, opportunity, and enterprise. OUP
Oxford.
Higgins, D., Omer, T.C. and et.al, 2015. The influence of a firm's business strategy on its tax
aggressiveness. Contemporary Accounting Research, 32(2), pp.674-702.
Reich, B.H. and Benbasat, I., 2013. 10 Measuring the Information Systems–Business Strategy
Relationship. Strategic Information Management, p.265.
Kourdi, J., 2015. Business strategy: a guide to effective decision-making. The Economist.
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