Strategic Planning Report: Vodafone's Business Strategies and Analysis

This report provides a comprehensive analysis of Vodafone's strategic planning, examining its strategic direction, external environment using PESTLE analysis, and competitive advantages through Porter's generic strategies. It also assesses the industry scenario using Porter's Five Forces model and identifies potential strategic drift. The report details Vodafone's mission and vision, conducts a SWOT analysis, and applies the Business Canvas Model to understand value creation. Furthermore, it presents strategic recommendations for Vodafone and evaluates the resource implications. The analysis covers Vodafone's evolution, mergers, and market strategies, highlighting its strengths, weaknesses, opportunities, and threats. The report concludes with key findings and recommendations to enhance Vodafone's market position and achieve its strategic goals in the telecommunications industry.

Strategic Planning

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1. Strategic direction and thinking that Vodafone followed within past years.........................3
TASK 2............................................................................................................................................4
1. Review the external environment of Vodafone by using PESTLE analysis...........................4
2. Presenting Vodafone competitive advantage by using porter's generic strategy....................5
3. Presenting industry scenario which Vodafone faces by using porter's five force model........6
TASK 3............................................................................................................................................7
1. Vodafone facing strategic drift................................................................................................7
2. Mission and vision of Vodafone.............................................................................................7
3. SWOT analysis of Vodafone..................................................................................................7
4. Applying Business Canvas Model .........................................................................................9
TASK 4..........................................................................................................................................10
1. Presenting strategies for Vodafone.......................................................................................10
TASK 5..........................................................................................................................................12
1. Evaluate the resource implication of the recommendation for Vodafone.............................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

INTRODUCTION
Strategic planning plays a significant role in every business environment. Strategic
planning is very necessary aspect that helps an organization in order to achieve all the targeted
goals of a company. The report deals with strategic planning of Vodafone, which is the largest
telecommunication company of United Kingdom. The report helps to understand the exact
meaning of strategic planning and a direction that a company follows in the last five years. The
report also uses an appropriate model that helps to review external environment of a company
and critically analyze the company's competitive advantages among their rivals. The report also
describes the industry scenario facing by Vodafone in their existing market area. Further, it also
describe the vision and mission of Vodafone with its strategic capabilities. The report also
presents different strategies to defend their core business and with the help of Business canvass
Model, it helps to describe the rationale and logic of how a company creates or capture the
values with their customers. It also evaluates resource implications of Vodafone and presents
various suggestions that a company has to imply in their work area.
TASK 1
1. Strategic direction and thinking that Vodafone followed within past years
Vodafone is one of the largest telecommunication services in UK who offers its services
to more than 515 million people. In the year 2010, the company offers new internet services for
their customer's mobile and after that, it launches mobile payment solutions that help to transfer
money. In this way, the company enhances its customer base. In last many years, the company
adopted many strategic planning for the development of its customer base. In the last year,
Vodafone announced to merge itself with Idea. It is another largest telecommunication company.
By merging itself to another tele-company help to increases its customers base and now it serve
their services up to millions of people. By late 2010, Vodafone also signs up partnership with
Telecom Malaysia of three year agreement with Digicel group which helps the customers of free
roaming charges. These two merging option help Vodafone to become one of the most usable
network systems in the world (Bryson, Edwards and Van Slyke, 2018). The company also reduce
their calling rates in order to enhance their market share as well as its customer’s base. As
compared to initial time, the company offers its service in only 26 countries but in current
scenario, Vodafone become the first operator in United Kingdom which offer its best packages in

prepaid as well as post paid services. As per the Annual report 2010, Vodafone increases its
market share up to 55 percent which create huge impact on other telecommunication companies.
The company's strategy mainly focus in growth of its revenue and improvement in its margin
that help to enhance its base of customers.
In the year 2013, the company also signed an agreement with orange S.A. to invest 1
billion pound for the expansion of Spain's broadband network. In June 2013, Vodafone
announces to buy a German company Kabel Deutschland and takes over 7 billion pound and
compete their rivals (McLean, 2018). In the year 2015, Vodafone expand its Russian agreement
that was held in 2008 as a strategic partnership which leads a result to acquire MTS Ukraine and
converted into Vodafone Ukraine. As per the Annual report of 2016 of Vodafone again merged
with Liberty global Ziggo brand to make itself Vodafone Ziggo group Holding. These are the
strategic planning of Vodafone which helps a company to raise its market share up to great
extent and this is the only way which helps to establish brand image in market & also compete its
rivals.
TASK 2
1. Review the external environment of Vodafone by using PESTLE analysis
By using PESTLE analysis, the company easily check its external environment which is
mentioned below:
Political Factors  It is the most important factor that affects Vodafone while
implementing the strategies.
 Every small unit of a company must follow the legal,
Illustration 1: PESTLE Analysis
Source: PESTLE Analysis, 2018

regulatory and tax rates which are made by the
government.
 Vodafone follows the act of government and policies in
order to enter the Mexican market (Springmier, Edwards
and Bass, 2018).
Economical Factors  Recession affects the market and as a result, customers do
not buy new products and saves their money which will
affect the selling power of Vodafone.
 Due to increase in inflation rates, Vodafone must decrease
its product price for their customers so that they enjoy
their services easily.
Social Factors  Multiple lifestyles of people affect the sales of company
and as a result it leads to decrease in their selling power.
 If another company offers latest and up gradable products
as per the latest fashion and demand then customers
switch their mind which also affects the brand company
such as Vodafone (Wolf and Floyd, 2017).
Technological Factors  Today's generation is completely based upon latest
technologies so it is necessary for Vodafone to innovate
new products & services which help in quick response
regarding changing behavior of customers and market.
Legal Factors  The company follows the legal laws of government such
as law of discrimination and equality.
 Sudden changes in legals rules are quickly implemented
by a company but there in UK taxes are high which affect
the profit of Vodafone.
Environmental Factors  It always takes care of environment and follow
sustainability law of environment. Vodafone conducted so
many campaigns in order to make awareness among

people for the safety of environment.
2. Presenting Vodafone competitive advantage by using porter's generic strategy
By using Porter's Generic Strategy, the company easily assesses all competitive
advantage in a market. By using cost leadership strategy, Vodafone can easily attract wide
number of customers by lowering its price so that customers will enjoy their offered services.
Sometimes to gain more competitive advantages, the company will also give discount in order to
maximize its sales; however it is significant cost advantage over competition and help to increase
its market share (Competitive Advantage of Vodafone, 2018). The company recently started
offering 'Home Cell' tariff in which company offers off- peak call from people's particular
location and can talk free up to 8 minutes that clearly helps to cost advantage over other
companies. On the other side, it is critically evaluated that Vodafone uses differentiation
strategy. As they launch I phone services and even the cost of those products are higher than
other companies but still the product is preferred by customers because the company offers free
Vodafone to Vodafone calls and give better inter connectivity connections then other
companies. This strategy helps to determine that Vodafone have strong competition and it is
beneficial to sustain for a long time.
3. Presenting industry scenario which Vodafone faces by using porter's five force model
Porter's five force model help to understand the strength of Vodafone in current
competitive market and this model mainly focus on business concern. This model help to
understand that in present industry scenario, where the company's power lie and it will help to
take fair advantage and improve weaknesses. Porter's five force model is describe below
Degree of Rivalry: Vodafone operates its business in more than 60 countries in all over
the world that is why the company has extreme high rivalry competition. It also offer low cost
call rates as compared to its competitors, similarly its rivals also provide innovative products and
services to the customers which proves that Vodafone has to provide much lower rate of
products. Even, in European market Vodafone has been saturated because of high mobile
subscriber penetration as a result company launches Vodafone 360 as a value added service (Van
Den Berg and Russo, 2017).

Threat of entry: Vodafone faces low threat entry because of barriers to entry. When a
company wants to entered into new market they should pay huge amount of license fees which
makes it difficult to cope up with new market. Similarly, sudden change in technologies and high
cost of setting network infrastructure makes company hard to establish themselves in a market.
But Vodafone cope up easily by maintaining its high level efficiency and faces low threats of
new entry.
Threat of Substitute: the threat of substitute for Vodafone is high because of emerging
new broadband services. Today people generally preferred video calling, Skype, Google Talk
and messenger or other social networking sites which becomes a great substitute to mobile
services. Having strong buying power, Vodafone does not need to change its cost because of
threatening of substitution (Hill, 2017).
Supplying power: Vodafone enjoys high bargaining power because it operates and earn
good profit as compared to its rivals. It also have large market share which means that it can
easily change its price or increases the cost of its offered service. By having high purchasing
power, Vodafone easily maintain its low price and continue with its profit.
Buying power: the buying power of customers is high in telecommunication industry
and Vodafone also has high bargaining power of buying which force to reduce the cost price of a
company not up to the level of their rivals. Therefore, Vodafone keep enjoying its huge profit as
compared to their rivals (Wheelen and et.al., 2017).
TASK 3
1. Vodafone facing strategic drift
Vodafone faces strategic drift and as a result the European revenue decreases up to 10
percent at the time of recession. According to the annual report it had been analysis that revenue
of UK dropped up to 3 percent because of the price competition in telecom markets from BT and
EE acquired new mobile system. Vodafone also faces loss of two most important contract which
was held previously by Cable and wireless but now are the part of a company (Lasserre, 2017).
2. Mission and vision of Vodafone
The vision of Vodafone is to become world's best mobile communication leader who
serve its best services to their customers and helping every individual, businesses and
communities to be connected with mobile sectors. On the other side, its mission is to enhance
the value of stakeholders and contribute to society by providing best quality, innovative

products, and affordable price of communication services to the customers. The main focus of
business is to emerge with markets, enterprise and facilitate the customers with new & advance
services that help to contributed in the global development (Vision of Vodafone, 2018.).
It has been concluded that Vodafone fulfill all the needs and demand of their customers
by delivering affordable and reliable communication services. The vision and mission of a
company help to contribute its major part in the economy of UK.
3. SWOT analysis of Vodafone
By applying SWOT, Vodafone's internal strategic capabilities can be identified and it is
as follows:
Strength:
 The company have wide range of network and it is count as second highest ranked
telecom operator because it operates more than 70 countries.
 Vodafone has high brand visibility as compared to others.
 Has strong advertising concept which help to attract wide number of customers (Heath,
2018).
 Best subscriber base across the world and it serves up to 350 million people.
Illustration 2: SWOT Analysis
Source: SWOT Analysis, 2018

 The company always differentiating its services regularly as compared its rivals.
 It tied up with most of the international companies in order to increases its customers
base.
Weaknesses:
 Because of low income and high unemployment in UK, customers cut down their mobile
bills which highly affect the sales of a company.
 As having high competition in market, Vodafone lower its price up to its bottom line.
 The company losses its market share in USA and as a result it creates adverse impact on
the sales of a company (Ayoubi, Mehrabanfar and Banaitis, 2018).
 Because of Brexit and low economy in Europe, Vodafone has poor performance and it is
not generated expected revenue in Europe.
Opportunities:
 it is necessary to improve the network coverage because their customers faces many
problem regarding disruption of its networking.
 Vodafone is mostly operated in urban areas whereas it competitors serve its network in
rural area, so it is necessary for Vodafone to provide its service in both area in order to
increases its customer base.
 There is a need to emerge market in new countries such as in Africa.
 Offering 4G network to their customers at cheap rates as compared to its competitors will
also help to enhances its market share as well as customer base (Robson, 2015).
Threat:
 the major threat for Vodafone is that it faces tough competition in market.
 Entry of new company at low pricing offering is the another threat for a company.
 In last many years, Vodafone faces tough competition as a result the profitability is
affected and the margin earn against the revenue generated has been drop day by day.
 Mobile number portability is the another threat to Vodafone because when the rivals
introduce new plan with cheap plan then customers switch their brands and as a result
company suffer.

4. Applying Business Canvas Model
Business Canvas model is help to explore complete products and services which a
company offer to their customers with accurate speed and agility. The main part of business
canvas model is mention below:
Value Proposition:
 provide free roaming services in Europe.
 Provide good networking.
 Provide internet facilities at cheap rates.
 Provide facility of money transfer with using bank account.
Customer segment:
 provide best service at small and medium business.
 In multinational organization.
 Prepaid/ postpaid mobile segments.
 Business in vertical/ horizontal markets.
Customer relationship:
 maintain person to person and customer to business transaction.
 Best customer service.
 Create brand awareness.
Customer Channel:
 through social sites, call centers, websites, sales team and market distribution.
Key Activities:
 Vodafone basically do billing, collection, research and development with innovations,
network operations, marketing and provide best customer service as well as support.
Key Resources:
 Mainly focus on underdeveloped countries such as Africa.
 HR, marketing, technologies, finance department, managers, HOD etc.
Key Partners:
 many advertising agencies, sponsorship, acquisition and partners, developers and
suppliers, local mobile operators and distribution partners etc.
Revenue Structure:

 fees from subscription, service fees charged by a company, taxes.
Cost structure:
 taxes, customer service, license, copyrights, data centers, maintenance related to
infrastructure.
TASK 4
1. Presenting strategies for Vodafone
Vodafone operated many countries and provide its best services to their customers. The
level of competition is high especially in telecommunication industry and in the context of
Vodafone it is also faces tough competition in a market. At current time, Vodafone has no clear
strategy in order to raise its market share and it is necessary to have an strategic planning with
effective resources of competitive edge. By using porter's generic strategy, Vodafone only
chooses cost leadership and differentiation strategy in order to increases its broad scope among
all countries (Hill, Jones and Schilling, 2014). It is to be recommended to Vodafone that the
company should implement differentiation strategy for its wider scope. So, company should
develop its new services by adding new features in their existing products and can be charge
extra for their additional features. As having low speed of internet, Vodafone also offer
broadband services and gain increase in its speed of internet browsing which it offers. This
strategy will definitely helpful for Vodafone because currently it facing internet problems in UK.
By offering different combo plans at low rates as compared to their rivals is the another
differentiation strategy which Vodafone can uses in order to attract more customers and raise its
customers base.
By using cost leadership porter's generic strategy, Vodafone also offers its plan with low
rates as compared to its rivals. Because by using this, company raise its profitability margin
which in future leads to acquire good image in market. Vodafone have good understanding with
its IT and it also maintain its competitive advantages. By introducing new voice calls and
broadband services the company wants to acquire good market base in order to provide best
internet service among other companies (Rothaermel, 2015). The company's main aim is to
serve good services to their customers and for this it always offer variety of plans at reliable
price which no other company offer. Still the company is not cope up with advanced
technologies so it is necessary to use all the latest technologies into the work area. Currently,
more than half of the UK population is based upon the new technologies. So it is necessary for

Vodafone it self to introduce new technologies into their business such as Skype, Voice call,
Messengers which help to enhance its market share. Company can uses various strategies in
order to attract new customers some of them are as follows:
 Vodafone must introduce new tariff plan for their customer which consist of combo pack
of low call rates and free internet service in reasonable rates. This low tariff plan will
help to attract wide number of customers and makes sure that the price should be low as
compared to its rivals (Cassidy, 2016).
 Recently the company offer unlimited international roaming plan at very low and
reasonable rates which help to attract many customers and Vodafone is trying to extend
its business plan in various different destination.
 Now a days in UK, cloud computing is become popular in telecommunication industry
and it becomes the most wanted software in IT sector. So Vodafone should implement
new technologies into their business so that it will help to sustain good position in a
market.
 Vodafone can develop value added services in their existing plans that help to meet
customer demand and it is essential to reshape the competitive environment.
 It also take feedback by using 360 degree review from their peers, customers,
subordinates or directors so that owner can measure or manage the level of customer's
satisfaction, determine the growth of revenue or profitability.
 Taking feedback by using social sites is another strategic options for Vodafone because
with the help of customers reviewing, company can easily know its down side and can
take proper steps in order to improve those problem (Hynes and Elwell, 2016).
 The planning system of Vodafone is not up to the mark so the management team must
ensures that all updates are done through direct communication because the company
have inefficient management system.
 Company should reduce their cost by introducing new tariff plan because this will help to
increase revenue in the develop markets. As, the company faces tough competition so it is
necessary to reduce the price tariff so that customers will easily afford new tariff plan.
 Introduce 4G network for their customers but should be in low price as compared to its
rivals. Vodafone facing issues in their network system so it is necessary to introduce new