SWOT and PESTLE Analysis : Telefonica
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Added on 2021-02-20
SWOT and PESTLE Analysis : Telefonica
Added on 2021-02-20
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Table of ContentsAbstract: ..........................................................................................................................................1INTRODUCTION...........................................................................................................................2Analysis using 7-S Framework....................................................................................................2Balance score card.......................................................................................................................5SWOT analysis..........................................................................................................................10PESTLE ANALYSIS................................................................................................................12CONCLUSION..............................................................................................................................15REFERENCES..............................................................................................................................17
Abstract: This present study has covered and shown increasing importance of using differentassessment tools for company analysis. It has shown importance of PESTLE analysis tool,SWOT analysis tool, Balance score card and 7 S model. It has made an effective use of PESTLEanalysis tool which help this company to analyse all external factors like economic factors likechanges in inflation and tax rates, political that shows impacts of political stability and instabilityof a particular country, social factors shows changes in society trends and buying behaviours ofcustomers. The main purpose of using this tool is to decrease all negative impacts of all thesefactors and increase brand awareness among people for increasing sales. It shows and uses SWOT analysis tool that helps the company to identify its strengths,weaknesses, opportunities and threats. By identifying all these internal factors,telecommunication industry develops and focuses business strategies for decreasing threats andweaknesses and increasing internal capacity. This report also shows an effective use of balancescore card tool with the main aim to keep track of execution of all organizational activities bystaff and monitor consequences arise from their actions. The main aim of telecommunicationindustry is to make changes in its organisational structure and make use of hierarchical structurefor managing all works of the company with efficiently. 7 S model includes company's strategy,staff, structure that is being used to access & monitor changes in the internal situation of thecompany.1
INTRODUCTIONOrganisational behaviour refers an important tool that help organisations to analyse groupas well as individuals performance and activities (Wilson, 2017). This Organizational Behaviouralso helps an organisation to study and identify complex and changing nature of human beings inorganisation.Telefonica is a Brazilian telecommunication group and known as subsidiary of SpanishTelefonica. This company was founded in the year of 1998. Headquarter of thistelecommunication company is in Sao Paulo, Brazil. In the year of 2010, it acquired some sharesof Vivo that belonged to Portugal Telecom (Bourque and et.al., 2018). In the context of productsand services it offers cable and satellite television, internet access, fixed line etc. It employedaround 35,000 people of several countries.This present study is going to show importance of using different analysis tool forTelefonica company. SWOT and PESTLE analysis plays an important role for analysing allinternal and external factors of the company. With the help of this analysis, this company focuseson increasing its skills and decreasing it's all weaknesses for accomplishing its goals andobjectives. It will also show importance of performance measurement tools such as 7 S modeland balance score card. By using these tools, Telefonica makes itself able to increase anddevelop capacity and effectiveness of its internal functions. Lastly it will discuss aboutincreasing importance of using hierarchical organizational structure for this company. It willmake an effective change in structure from flat to hierarchical because with the help ofhierarchical structure, it maintains managerial entity with efficiently.Analysis using 7-S FrameworkMcKinsey Framework refers to the management model which was propound by RobertH. Waterman Jr. and Tom Peters who were the former employees of McKinsey Company. Thismodel is being used by the companies for the purpose of analysing the organizational structure.This model helps companies to understand their structure according to the internal situation ofthe business and accordingly do changes in the organizational structure (McKinsey 7SFramework, 2019). It is done in order to improve the performance and efficiency of theorganization. For the improvement, there are seven (7) “S” elements which is the part of themodel. In the context of the Telefonica Company, This model will help company to change their2
organizational structure from flat to hierarchical structure. Thus, for the change in organizationalstructure, Company will also change in their 7S elements. These 7S are as follows - 3(Illustration 1: Seven Elements of McKinsey ModelSource: McKinsey 7S Framework, 2019)
1S – Strategy – Strategy refers to the action plan which is prepared by the top management teamof the organization for the purpose of achieving organizational goals and objectives. There arevarious types of strategies which is being used by the companies in order to gain competitiveadvantages (Perveen and Habib, 2017). In the context of Telefonica, for the transformation of organizational structure, companyis required to change in its strategies such as employee management strategy, marketing strategy,distribution strategy, organizational and employment policies. 2S – Structure – Structure means arrangement of organizational aspects such as task allocation,supervision and co-ordination in order to achieve the organizational objectives. It is consideredto be the base for organizational performance. For the structure change, companies are requiredto change in their elements of organization structure (Ravanfar, 2015).For the change in organizational structure of Telefonica, Company is required to increasein their management layers, wider their chain of command & span of control, make departmentsaccording to the business activities, focus on the specialization and make roles & responsibilitiesmore formalize.3S – System – System is related to the set up of various organizational aspects in order to fit intothe organizational structure. System basically builds with various sub-systems (Szeto, 2017). In order to ease in conversion of organizational structure from flat to hierarchical,Telefonica has to do change in their sub-systems so that organizational system can be change.For that firm has to divide their whole organization(which is considered to be a system) intovarious divisions (which are considered to be as sub-systems). This will also lead to change incommunication system, reporting system and working system of the organization. 4S – Staff – Staff can be define as the people who are working for the company in order toachieve the organizational objectives. It includes CEO, executives of all the levels andemployees of the organization. In this model, staff involves employees, their job roles andcompetences (Bismark and et.al., 2018). For the implementation of Hierarchical organizational structure in the context ofTelefonica, there will be change in the staffs of the company. There will be change in humanresource strategies such as recruitment & selection, training & development, performancemanagement & reward system etc. Along with that, Organization is required to specializedemployees which can be only hired by the specific job description and person specification4
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