Strategic Management Analysis of Telstra Corporation

This report analyses the external and internal environment of Telstra Corporation, including its resources and capabilities. It also suggests the implementation of the Oracle software for effective management of resources.

Running head: STRATEGIC MANAGEMENT
Strategic Management
Name of the Student
Name of the University
Author note

1STRATEGIC MANAGEMENT
Executive Summary
The report is built on the analysis of the external and the internal environment of a company.
The organization which had been considered for the study is Telstra Corporation. The
external and the internal factors of the company are analysed in the report. The resources and
capabilities which have been gained by Telstra in the industry have also been analysed in the
report in detail. The information system which can be implemented in the organization has
also been discussed in the report. The software named Oracle has been suggested for
implementation in Telstra for the proper management of resources of the company.

2STRATEGIC MANAGEMENT
Table of Contents
Part 1..........................................................................................................................................3
1. About Telstra Corporation.................................................................................................3
2. Background of the telecommunication industry of Australia............................................3
3. General Environmental Analysis.......................................................................................4
4. Analysis of the Industry Environment...............................................................................5
5. Competitive Environment..................................................................................................7
6. Opportunities and Threats..................................................................................................7
Part 2..........................................................................................................................................8
1. Resources of Telstra...........................................................................................................8
2. Identification of the capabilities of Telstra........................................................................9
3. Analysis of the Core competency of Telstra......................................................................9
4. Proposed information system to be implemented in Telstra................................................10
5. Recommendations based on proposed information.........................................................11
Conclusion................................................................................................................................11
References................................................................................................................................12

3STRATEGIC MANAGEMENT
Part 1
1. About Telstra Corporation
Telstra or Telstra Corporation Limited is a multinational telecommunications based
company that has its origin in Australia. The firm has been able to develop its position in the
telecommunications industry with the help of its different types of services that are offered to
the consumers. The company has thereby developed a history in telecommunications based
industry of Australia. The services that are offered by the company mainly include, mobile
access based facilities, internet based access, television services (Telstra.com.au. 2018).
The company had been privatized in the telecommunications industry after some
years of its effective operations. Different change programs had also taken place in the
company based on its operations in the industry. This change had thereby occurred in the
organization under the leadership of the new CEO David Thodey. Telstra is however
struggled to maintain its effective position in the industry (Telstra.com.au. 2018).
2. Background of the telecommunication industry of Australia
The Australian telecommunication industry and the growth which has been shown is
mainly driven with the help of the government of Australia. The strict regulations which have
been developed by the government have played a major role in the operations. The different
telephone based services were first provided by companies to its customers in Australia. The
telephone exchange was first developed in Australia in 1880 (Telstra.com.au. 2018).
The Australian telecommunications industry has been able to develop in a huge
manner with the help of different organizations. The levels of competitiveness in
telecommunications industry has increased due to the amounts of growth. The competitive
advantage of different organizations has also decreased due to huge growth of the industry.

4STRATEGIC MANAGEMENT
Telstra has developed an effective position in the telecommunications industry due to the
long term based organizations (Aghazadeh 2015).
3. General Environmental Analysis
Political factor – The different political factors which can affect operations and the
revenues of Telstra need to be analyzed by the company. The various regulations and policies
that are thereby developed in the countries are considered to be important factors for Telstra.
The political stability of the area will thereby be able to play an important part in the ways by
which Telstra is able to operate in the industry (Baporikar 2015).
Economic factor – The economic situation of different countries and the macro-
economic factors are able to influence the ways by which Telstra is able to operate in the
industry. The economic aspects that are thereby capable of affecting the organization mainly
include, the inflation based rates, savings rate, foreign exchange based rate and the economic
cycle. The stability of the economy of the country is thereby considered to be an important
part in the revenues that can be earned by the company (Barros, Hernangómez and Martin-
Cruz 2016).
Physical factor – The share which has been gained by Telstra in the market is mainly
able to affect the levels of revenues in a huge manner. The share based prices of the company
are thereby driven in an effective manner by the macro-economic environment. The physical
presence of Telstra in Australia is considered to be important for the company (Cosenz and
Noto 2016).
Socio-Cultural factor – The social condition which has been developed in Australia
and the effective culture can affect the ways by which Telstra is able to operate. The people
of Australia are thereby able to affect profitability of the company in a huge way. The

5STRATEGIC MANAGEMENT
effective levels of understanding are thereby required in order to create demand for the
services that are offered by Telstra. The skills and the demographics of the consumers are
thereby important to be considered by Telstra (Daspit et al. 2017).
Global factor – The turbulence that has been experienced in the industry can affect
the Australian telecommunications based industry. The organization is thereby affected by
different changes that have taken place in prices of the services which are offered by the
competitors of Telstra (Demir, Wennberg and McKelvie 2017).
Technological factor – The disruptions which have occurred in the technologies have
been able to affect the companies like Telstra. The developments that have occurred in the
industry has major effects on revenues and profitability which has been earned by Telstra.
The cost based structure that has thereby been formed in the telecommunications industry has
been affected in a huge manner by technologies (Durand, Grant and Madsen 2017).
Demographic factors – The different demographics factors can play a huge role in
effective processes of the company in telecommunications sector in Australia. The effective
study of the demographics mainly includes the factors like, income based levels, occupation
and the age of the consumers. The services and products of the company can be offered based
on demographic factors (Dyer et al. 2015).
4. Analysis of the Industry Environment
Threat of the Substitutes – The different needs of the consumers are fulfilled with
the services that are offered by the competitors of Telstra. The company faces major threats
based on the easy availability of the substitute services in the industry. This been able to
increase the levels of competition in the telecommunications based industry. The operations

6STRATEGIC MANAGEMENT
of the company based on services that are offered by its competitors are able to affect the
revenues (Dobbs 2014). The effect of this force is quite high in the industry.
Rivalry amongst the existing competitors – The levels of rivalry that is evident in
the Australian telecommunications industry are high. The competitive industry of
telecommunications has major effects on the profitability levels of Telstra. The high levels of
competition in the industry thereby plays a major role in the ways by which profitability can
be increased (Engert, Rauter and Baumgartner 2016).
Bargaining Power of the Suppliers – The suppliers of Telstra who are present in the
industry are able to the company with the required raw materials. The various suppliers who
have been able to form a dominant place in telecommunications industry can affect the
revenues of Telstra. The organization can however increase the profitability levels if it is able
to reduce power of the suppliers (Ethiraj, Gambardella and Helfat 2018). An efficient supply
chain can be developed by the company in order to offer the services to the company.
Bargaining Power of the Buyers – The buyers of the telecommunications based
industry are highly challenging in nature. The extreme amounts of pressure which has been
created by the buyers is able to affect the revenues of the company. The power of these
customers can thereby be reduced in an effective way with the proper assistance of huge
number of consumers (Frynas and Mellahi 2015). This is further able to affect the prices that
are decided for the services and products of Telstra.
Threat of New Entrants – The introduction of the new companies in the
telecommunications industry is able to influence the levels of innovation. The lower levels of
prices which are thereby set by the new companies have also affected the profitability based
levels of the organizations. Telstra had developed an effective competitive advantage in the

7STRATEGIC MANAGEMENT
industry with the help of its long term based operations (Galliers and Leidner 2014). The
levels of threats which are however provided by the new organizations are quite low.
5. Competitive Environment
The environment that is developed in Australian telecommunications industry is
aggressive in nature. The various companies had also provided high levels of competition to
Telstra in the industry. The company has created a position in the industry as compared to its
competitors. The position that has been formed by the company in Australia is affected in a
huge manner by the organizations like, Optus and Vodafone (James 2016). The share that has
been gained by Telstra in the industry has thereby increased from around 42% to 53% from
the years 2010 to 2014.
The mobile based division of Telstra has generated revenues of greater than 10 billion
Dollars. The subscribers of the competitor of Telstra named Optus is reduced to 9.4 million
Dollars. The services that are thereby offered by the competitors of Telstra to the consumers
have a major effect on the revenue levels of the company. The company has faced huge
amounts of threats from the ways by which different organizations in the industry have
operated (Sakas, Vlachos and Nasiopoulos 2014).
The tough competitive environment has thereby played a vital part in affecting the
revenues of Telstra Corporation in the country. Telstra thereby needs to manage the
operations in such a manner which can help in maintaining the position which has been
developed in the highly competitive telecommunications based industry.
6. Opportunities and Threats
Opportunities – The major opportunities that can be used by Telstra are based on the
reduction in the costs related to transportation. The increase in usage of different online

8STRATEGIC MANAGEMENT
channels can also act as a major opportunity for the effective operations of Telstra in the
industry (Shepherd, Mcmullen and Ocasio 2017). The reduction which has been depicted in
the inflation based rates in the industry is an important factor that can affect the prices of
Telstra. The trends that have been developed in the industry are also based on the effective
behaviour of different consumers in the telecommunications industry of the country.
Emerging markets are able to affect the revenues of Telstra (Tantalo and Priem 2016).
Threats- The effective lack of the levels of regularity of the supply based on the
innovative products pose major threats to Telstra. New technologies and their applications in
the competitor organizations of Telstra has played a main part in providing threat to the
operations of the company (Teece 2017).
Part 2
1. Resources of Telstra
Human resources – The human resources or employees are considered to be the
most important part of the effective operations and revenues of Telstra in the industry. The
employees have provided best services to the organization and in turn satisfy the consumers
as well. The development and training related resources that have been gained by Telstra
have been able to play a key part in the process which is used by Telstra in order to gain its
position in the telecommunications industry (Sakas, Vlachos and Nasiopoulos 2014).
Financial resources – Telstra has developed an effective financial position in the
industry with the help of its long term operations in the industry. The organization has further
invested the resources in order to develop the services. This is an important part of the
effective operations of the company (Galliers and Leidner 2014).

9STRATEGIC MANAGEMENT
Physical resources – The physical resources have been developed by Telstra with the
help of its numerous stores all over the country. This has further increased the availability of
its services as well (Engert, Rauter and Baumgartner 2016).
2. Identification of the capabilities of Telstra
The capabilities and culture of the organization is mainly related to the technologies
that are implemented by Telstra in the industry. The transformation in the workplace has been
possible with the help of implementation of technologies. The environment in which
organizations are able to operate are based on the skills and career related directions as well.
The evolution which has taken place in roles played by different employees is affected by
capabilities (Shepherd, Mcmullen and Ocasio 2017).
The different changes in workplace based environment have enhanced the capabilities
of Telstra. The major capabilities of the firm have been developed in an effective way with
the help of its long term actions. The organization has been able to provide tough competition
to the other organizations with the help of its competitive advantage developed with the help
of its services (Sakas, Vlachos and Nasiopoulos 2014).
3. Analysis of the Core competency of Telstra
First Competency – The industry in which Telstra operates is based on the huge
levels of growth. The growth in network traffic is also a significant factor which helps in the
growth of different competencies of the company. The company has developed its position
among the changes (Ethiraj, Gambardella and Helfat 2018).
Valuable – High
Rarity – Moderate
Imitability – Moderate

10STRATEGIC MANAGEMENT
Organization – Yes
Second competency – The effective services that are offered by Telstra in the
industry can be considered as a competency of Telstra.
Valuable – Moderate
Rarity – Moderate
Imitability – Moderate
Organization – Yes
4. Proposed information system to be implemented in Telstra
The telecommunications and the technology industry has faced major changes in the
modern business environment. The application of the management information system is able
to affect the proper maintenance of data. The technology which can thereby be used by the
organization for managing the data and information is able to play a key part in the operations
of Telstra. The different stages that can be effective addressed by the information system
include, implementation, identification of the problem, needs of the system, testing and
documentation, design of the system (Frynas and Mellahi 2015).
The software which can be implemented in the information system is Oracle. The data
based on employees and the customers can be managed in an effective way with the help of
this information system. The managers are thereby provided with help by the information
system to manage different operations of the company. The marketing and sales based
activities of the organization are thereby entirely based on the proper management of the
information systems that have been implemented by the company (Soomro, Shah and Ahmed
2016). The management of data plays a vital part in the organizations in order to maintain the
customers effectively. The technologies which have been provided in the modern business

11STRATEGIC MANAGEMENT
environment can thereby be used in an effective way in order to manage the organizational
operations (Galliers and Leidner 2014).
5. Recommendations based on proposed information
The proper implementation of the information management system that has been
proposed is effective for proper operations of Telstra. The maintenance of consumer data is
important for the company and can affect the revenues of Telstra. The employees or human
resources of the company will thereby be maintained in an effective way with the proper
implementation of the management information based system.
Conclusion
The report can thereby be finished by stating that the external environment of
Australia can affect the operations of Telstra Corporation. The external changes have played
a key role in the ways by which the organizations are able to increase their revenues. The
internal environment and resources of the company have played an important role in the
profitability and the revenues. The capabilities and the resources that have been gained by the
company are important for the implementation of the information systems. The information
based systems which have been suggested in the report can play a significant part in the
effective operations of Telstra.

12STRATEGIC MANAGEMENT
References
Aghazadeh, H., 2015. Strategic marketing management: Achieving superior business
performance through intelligent marketing strategy. Procedia-Social and Behavioral
Sciences, 207, 125-134.
Baporikar, N., 2015. Strategic management overview and SME in globalized world.
In Business Law and Ethics: Concepts, Methodologies, Tools, and Applications (pp. 266-
283). IGI Global.
Barros, I., Hernangómez, J. and Martin-Cruz, N., 2016. A theoretical model of strategic
management of family firms. A dynamic capabilities approach. Journal of Family Business
Strategy, 7(3), pp.149-159.
Cosenz, F., and Noto, G., 2016. Applying system dynamics modelling to strategic
management: a literature review. Systems Research and Behavioral Science, 33(6), 703-741.
Daspit, J.J., Chrisman, J.J., Sharma, P., Pearson, A.W. and Long, R.G., 2017. A strategic
management perspective of the family firm: Past trends, new insights, and future
directions. Journal of Managerial Issues, 29(1), p.6.
Demir, R., Wennberg, K. and McKelvie, A., 2017. The strategic management of high-growth
firms: a review and theoretical conceptualization. Long Range Planning, 50(4), pp.431-456.
Dobbs, ME., 2014, 'Guidelines for applying Porter's five forces framework: a set of industry
analysis templates', Competitiveness Review, vol. 24, no. 1, pp. 32–45.

13STRATEGIC MANAGEMENT
Durand, R., Grant, R.M. and Madsen, T.L., 2017. The expanding domain of strategic
management research and the quest for integration. Strategic Management Journal, 38(1),
pp.4-16.
Dyer, J.H., Godfrey, P., Jensen, R. and Bryce, D., 2015. Strategic Management: Concepts
and Cases. Wiley Global Education.
Engert, S., Rauter, R. and Baumgartner, R.J., 2016. Exploring the integration of corporate
sustainability into strategic management: a literature review. Journal of cleaner
production, 112, pp.2833-2850.
Ethiraj, S.K., Gambardella, A. and Helfat, C.E., 2018. Theory in strategic
management. Strategic Management Journal, 39(6), pp.1529-1529.
Frynas, J.G. and Mellahi, K., 2015. Global strategic management. Oxford University Press,
USA.
Galliers, R. D., and Leidner, D. E., 2014. Strategic information management: challenges and
strategies in managing information systems. Routledge.
James, S. D., 2016. Strategic bankruptcy: A stakeholder management perspective. Journal of
Business Research, 69(2), 492-499.
Peltier, T. R., 2016. Information Security Policies, Procedures, and Standards: guidelines for
effective information security management. Auerbach Publications.
Sakas, D., Vlachos, D. and Nasiopoulos, D., 2014. Modelling strategic management for the
development of competitive advantage, based on technology. Journal of Systems and
Information Technology, 16(3), pp.187-209.

14STRATEGIC MANAGEMENT
Shepherd, D. A., Mcmullen, J. S., and Ocasio, W., 2017. Is that an opportunity? An attention
model of top managers' opportunity beliefs for strategic action. Strategic Management
Journal, 38(3), 626-644.
Soomro, Z. A., Shah, M. H., and Ahmed, J., 2016. Information security management needs
more holistic approach: A literature review. International Journal of Information
Management, 36(2), 215-225.
Tantalo, C., and Priem, R. L., 2016. Value creation through stakeholder synergy. Strategic
Management Journal, 37(2), 314-329.
Teece, D. J., 2017. A capability theory of the firm: an economics and (strategic) management
perspective. New Zealand Economic Papers, 1-43.
Telstra.com.au. 2018. Telstra - mobile phones, prepaid phones, broadband, internet, home
phones, business phones. Retrieved from https://www.telstra.com.au/