América Móvil Case Study: Telecommunications Business Analysis Report

This case study analyzes América Móvil, a major telecommunications firm based in Mexico. It examines the company's operational positioning, financial performance, and international competitive strategies, including acquisitions and market expansion. The study delves into América Móvil's organizational structure, control issues, and entry strategies into different regions. It further explores operational control, production, distribution, supply chain management, and human resource practices. Key issues and opportunities for management are discussed, along with recommendations for the company's future growth and sustainability. The report provides insights into the firm's sustainability efforts, corporate governance, and its approach to technological advancements and evolving customer needs, offering a comprehensive overview of América Móvil's business model and operations.

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América móvil (a case study)
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1AMÉRICA MÓVIL (A CASE STUDY)
Executive Summary: This paper brings to light the case study of a Mexican firm with respect to
the various features based on which it works. It portrays the various aspects of one of the top
firms of the world operating in the field of telecommunications sector, América Móvil. The
paper discusses the operational positioning with the help of various parameters that help measure
the profitability of the firm. The paper also discusses the management techniques, expansion
strategies and human resource operations that the firm uses and implements. The paper also
discusses the key issues and areas of opportunities and possibilities prevalent for the managers of
the firm and provides recommendations for the same.

2AMÉRICA MÓVIL (A CASE STUDY)
Table of Contents
Introduction......................................................................................................................................3
Overview of América Móvil............................................................................................................3
Current Operating Position..............................................................................................................4
International competitive strategy...................................................................................................5
Organizational Structure and Control Issues...................................................................................6
Entry strategies used to enter other regions/countries.....................................................................7
Operational control, production and distribution/supply chain management..................................7
Management of Human Resources..................................................................................................8
Key issues or opportunities for management.................................................................................10
Recommendations..........................................................................................................................11
Conclusion.....................................................................................................................................11
References......................................................................................................................................13

3AMÉRICA MÓVIL (A CASE STUDY)
Introduction
Mexico is one of the most sought after countries in the world when it comes to the field
of business, operations and globalization (Avelar 2013). With the help of advanced technology
and state of the art infrastructure, Mexican companies are now increasingly helping in extending
specialized and customized services to their customer bases which are situated within the country
as well as other countries in the world (Aigner, D. and Lloret 2013). Almost around thirty years
ago, mostn companies in Mexico started manufacturing operations based services and the same
firms account for a significant proportion of income, revenue generation and gross domestic
product for the nation. América Móvil is one such firm and it operates in the telecommunications
sector (Americamovil.com 2018). It is one of the largest corporate organizations in the world and
is the fourth largest networking firm in the context of equity subscribers. This report attempts to
study the overall operational workings and strategies of the firm that help in the growth of the
firm internationally.
Overview of América Móvil
América Móvil is headquartered in Mexico City and is the largest provider of
telecommunications service in Latin America. It is well known for providing an integrated
telecommunications platform of the world class level. It offers services and products that help in
providing easy solutions to customers situated in over 25 locations across America and Europe.
It majorly operates under three brands which are known by the names of Telcel, Claro and
Telmex in Latin America (Americamovil.com 2018). The firm has promoted a very significant
industry at the global level as it has helped in the development of many countries with social and

4AMÉRICA MÓVIL (A CASE STUDY)
economic progress by the use of telecommunications (Powell 2012). The firm serves a
population of over 892 million through both fixed and mobile services using tools, technology
and people at all levels of operations. The firm publishes a Sustainability Report every year that
helps in recognizing the transparent manner in which it helps the governments of various
countries through its services. It also publishes a Global Reporting Initiative Guide which helps
its customers and stakeholders to review how it tries to meet its objectives of growth through the
process of sustainable management. To promote sustainability in an effective manner the firm
joined United Nations Global Compact on February 2016 (Americamovil.com 2018). In the next
section of the report the current situation of operating position is mentioned and described
Current Operating Position
The positioning of the products and services of any firm tend to reflect the rank of those
products and services in the industry as compared to similar products and services of other firms
operating in the same sector. According to the Financial and Operating Report of 2017, in the
second quarter of 2017, América Móvil observed a rise in the operating profit by 21% as
compared to the previous year. The net debt ratio of the company got reduced by 12.5% (Vargas-
Hernández 2012). The EBITDA of the company also increased sequentially for the countries of
Argentina, Peru, Mexico, Colombia, Chile and Europe and the net income of the firm rose from
$7,700 million in 2016 to $14,313 million in 2017 (Americamovil.com 2018). There was
increased service revenue generation in all sectors of operations and across all locations. The
world ranking of the firm eventually moved from the 9th position in 2015 to the 8th position in
2017 (Americamovil.com 2018).

5AMÉRICA MÓVIL (A CASE STUDY)
International competitive strategy
América Móvil being a rapid and emerging multinational telecommunications firm follows
some of the best strategies of expansion across various countries while maintaining sustainability
and environmental ethics at the same time (Americamovil.com 2018). The various expansion and
competitive strategies used by the firm can be broadly summarized under the following three
headings:
 Acquisitions– The firm has used acquisition as a major competitive tool and acquired
Carso Telecom and Telmex International in 2010 in an attempt to provide a strong
competition to Telefonica of Spain and Telekom Malaysia of Malaysia. The firm also
acquired 100% of Oceanic Digital which operated in Jamaica. The company also
partnered with Ooredoo in an attempt to deliver services together internationally.
America Movil also acquired operations belonging to its rival, Oi in an attempt to
increase its operations and sales in Brazil (Arugaslan and Samant 2015).
 Closeness – The next most important competitive strategy used by the firm is the
objective f promoting closeness across all regions that it operates in and among all classes
of people residing in those regions, even in the rural areas. The firm makes vast
investments in the locations where it operates in order to promote easy communication
for personal as well as business purposes. The firm also makes use of transparent
business operations with the help of corporate governance.
 Transformation – The firm aims to cater to the changing business, economic and social
needs of people. These changes are addressed by the firm by means of most advanced
technology and infrastructure. The firm is constantly evolving to cater to the needs of
improved integrated technology and value creation for the stakeholders.

6AMÉRICA MÓVIL (A CASE STUDY)
Organizational Structure and Control Issues
The organizational structure of any firm is responsible for deciding of roles and
responsibilities within a particular firm. This is generally done to mitigate risks and overcome
obstacles created due to ambiguity in division of work so that the objectives of the firm are best
met. The organization structuring of América Móvil consists of a Board of Directors and a team
of vibrant managers. The Board of Directors consist of Chairmen, Vice Chairmen and Directors
and also a few Chief Exceutive Officers and Chief Operations Officers. The management team
of América Móvil consists of a Chief Executive Officer, a Chief Financial Officer, an Executive
Director of Fixed Operation Lines, an Executive Director of Mobile Operations and a General
counsel. In addition to this, there are different teams located in the different countries where the
firm’s branches are located which consist of a Chief Executive Officer and a Chief Financial
Officer (Americamovil.com 2018).
The control issues of a firm having an operational size as big as that of América Móvil
involves expansion into more countries and expansion of customer base, use of disruptive
business models, evolving the services and products provided with the help of latest technology
(Vargas-Hernández, López-Morales and Inda-Tello 2015). The other group of control issues that
the firm faces includes the managing of a vast cohort of employees as well as stakeholders and
partners. In this context, the correct acquisition of employees also defines a very important
aspect of control issues. Sometimes even the acquisition and partnering with other firms and
catering to the different laws and regulations in different countries become extremely
complicated and difficult. The ever changing set of reforms and exchange rates imposed by the
government of Mexico also contribute to the set of risk control issues for the firm.

7AMÉRICA MÓVIL (A CASE STUDY)
Entry strategies used to enter other regions/countries
Being one of the most sought after companies in the field of telecommunications in Latin
America, América Móvil uses an integrated technological platform, adopts new technologies and
expands both coverage and client base along with acquisition of firms to expand globally
(Americamovil.com 2018). The firm essentially invests in companies that trigger the economic
growth of themselves and the nations as a whole by injecting the means of easy and cheap
communication. The firm also makes the attempt of choosing countries where it can expand its
services based on the set of laws and regulations in place in the country. Through the access to
information and connectivity, the firm is aiming to reduce the existent digital gap in many
countries. In Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua, the firm has
expanded through addition of new sites and carriers, increase in the optical fiber network by
investing in both hardware and software and complying to commercial agreements that will help
diversify the services and increase its capacity utilization. Again in El Salvador, Guatemala,
Honduras and Nicaragua, the firm has replced old ports and increased the installing capacity of
the network of televisions. At Chile the firm has improved its technological diversity and
increased the spatial capacity of its head quarters.
Operational control, production and distribution/supply chain management
The operation control of the firm is guided by the corporate governance policies and code
of ethics which consist of principles that aim towards investment in assets which are productive,
increasing productivity through simplification of the process, reinvestment of the earnings,
maintaining a flexible and transparent hierarchy, meeting new challenges, maintaining austerity
and coping societal problems through creativity that is highly entrepreneurial. The operations are

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carried out in such a way that the company’s resources are utilized in the most efficient and
sustainable way.
For purposes of enhanced production and customer satisfaction, the firm constantly tries
o maintain track records of the customer’s changes in demands depending on their lifestyles and
needs. The firm also tries to measure the perception of customers through studies like surveys,
chats, social media and phone research. The products and services provided are generally reliable
and easy to use and understand. The various channels of servicing and production include social
media, web platforms, management of satellite fleet, contact centers, internet hotspots, machine
to machine services and customer servicing management software (Americamovil.com 2018).
The supply chain of this firm consists of a vast array of value chain where every linkage
is managed with meticulous precision and control. The entire supply chain of the firm consists of
telecommunication equipment, infrastructure and services that are needed to operate the offices
(Americamovil.com 2018). For each of the services the processes of training and development,
quality control and compliance to quality requirements and safety of products are implemented.
The suppliers are also required to maintain evidence of the parameters mentioned above and
adhere to the rules related to environmental and human resource ethics.
Management of Human Resources
Although the operations of the firm are large enough to promote flexibility of the process of
employee hiring and the maintaining of their quality, América Móvil tends to hire local
employees who are well aware and acquainted with the ongoing business scenario in their
country. This policy of employing local population at the various locations is in sync with the

9AMÉRICA MÓVIL (A CASE STUDY)
idea that it strengthens the process of development of the local communities (Americamovil.com
2018).
 The extensive set of training and development programs employed by the firm help in
managing of human skills and resources across the various sections of the firm which are
located in Mexico as well as other countries. The training and development programs aim
at improving the technical and skill oriented facets of every employee. The training and
development process is rigorous and involves usage of resources which are internally
based within the firm as well as help from external firms that help in the gaining of
experiences and certifications necessary for every employee based on his level of position
in the firm. The training programs adhere to the rules and regulations in place in the
different countries based on programs proposed by the Ministry of Labor.
 The firm also has programs that help in the development of potential and utilization of
the potential in an extensive manner. The firm combines several psychometric tests and
personality traits to set targets for each employee. It also conducts conferences and
workshops based on values of leadership, motivation, interaction and motivation that help
to evaluate people both entirely and also in terms of specific actions. The firm focuses on
building of competency questionnaire that is used by employees for taking tests. Based
on the results of these tests, presentations are made based on which group meetings and
individual follow ups are set up. After an in depth survey through the above mentioned
process, the firm formulates and presents potential development presentations.
 The firm also forms feedbacks based on performance and which makes the promotion
process easier and helps in setting specific goals for specific employees based on their

10AMÉRICA MÓVIL (A CASE STUDY)
roles and the projects they are currently working on. This helps in improving
performance of employees in a uniform and transparent manner.
 The other attempts made by the firm to help manage resources both at Mexico and
internationally, include surveys based on workplace climate and programs that look after
the social well being of its employees.
Key issues or opportunities for management
As mentioned before the biggest set of opportunities for the managers at América Móvil lies
in briding the digital gap that exists between the already existing level of technology in the field
of telecommunications and the residents of the countries, both rural and urban where the firm is
situated (Americamovil.com 2018).
 The managers are also increasingly being expected to seek out for opportunities in the
field of acquisitions and partnering.
 The other opportunities and issues that the managers are expected to increasingly handle
involve compliance to the sustainability issues which include the ethics and
environmental issues.
 Planning and resource management based on feedbacks of stakeholders is also equally
important.
 The managers also need to concentrate on the existing partnerships and tie ups with
different companies in different countries so that long run ties are maintained.
 Optimization, automation, logistics and maintenance of the integrated platform of
communication form other goals and objectives for the managers.

11AMÉRICA MÓVIL (A CASE STUDY)
 Managers are also responsible for building technological applications and software that
help build disruptive business models which in turn help in catering to the changing
demands of people.
Recommendations
With growing amounts of competition in the home and foreign countries, the firm needs
to evolve strategies to stay in business and help use smart products for processing and analyzing
data and pushing the limits of the industry as a whole. The firm should increasingly try to
achieve goals which are inclined towards promoting connectivity in businesses both small and
large, government, educational institutions and other firms that it caters to or has long term
relationships with. The firm should also try and make the process of hierarchical organization
more flexible and open to employees from all the regions that it operates in. Increased policies
should also be formulated for adhering to sustainability and manufacturing of products that are
economically and environmentally viable. The firm should also handle the demands and
preferences of the stakeholders and cater to their needs by improving their positioning in the
stock market and in the target customer based market too.
Conclusion
América Móvil is one of the top best companies in Mexico and Latin America not only in
the field of telecommunications but also in the field of manufacturing consumer based products.
It takes care of Latin America and Europe in the most innovated way of providing easy and
affordable communication across all sections of the countries and across all demographics of
people. The firm utilizes the economic and social growth of other countries by providing them

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access to information and technology and also utilizes the talent of its human and other resources
through rigorous methods of training, potential development and workplace climate
management. The firm should increasingly focus on acquiring other firms that will help in
specialization of its services and will help cater to a larger cohort of demands from its clients.

13AMÉRICA MÓVIL (A CASE STUDY)
References
Americamovil.com 2018. Available online at
http://www.americamovil.com/sites/default/files/2017-07/AMXIS16ING_1807_Final.pdf
Americamovil.com 2018. Available online
http://www.americamovil.com/sites/default/files/2016-08/29052015.pdf
Americamovil.com 2018. Available online
http://www.americamovil.com/sites/default/files/2017-07/2q17.pdf
Americamovil.com 2018. Available online
http://www.americamovil.com/sites/default/files/2016-05/2006.pdf
Americamovil.com 2018. Available online
http://www.americamovil.com/investor-relations/financial-reports/fundamentals
Arugaslan, O. and Samant, A., 2015. RISK-ADJUSTED RETURNS OF AMERICAN
DEPOSITARY RECEIPTS FROM LATIN AMERICA. QRBD, p.177
Avelar, F., 2013. Pact for Mexico and Telecommunication Reform in Mexico. Law & Bus. Rev.
Am., 19, p.247.
J. Aigner, D. and Lloret, A., 2013. Sustainability and competitiveness in Mexico. Management
Research Review, 36(12), pp.1252-1271.
Powell, S.R., 2012. An analysis of the latin american wireless telecommunications market
portfolios of telefonica and america movil. In Research, Practice, and Educational
Advancements in Telecommunications and Networking (pp. 267-284). IGI Global.

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Vargas-Hernández, J.G., 2012. Strategic mergers and acquisitions of Mexican emerging
multinationals. Journal of Applied Management and Investments, 1(1), pp.30-37.
Vargas-Hernández, J.G., López-Morales, J.S. and Inda-Tello, M., 2015. Exploration of
internationalization patterns in Mexican multinationals firms. Journal of Emerging Trends in
Economics and Management Sciences, 6(6), pp.324-332.