Report on Talk Talk PLC: Business Environment and Governance Analysis

This report provides a comprehensive analysis of Talk Talk PLC's business environment. It begins with an overview of the company, its history, and organizational structure, highlighting its position in the telecommunications industry. The report then delves into the governance structure of Talk Talk PLC, examining the roles of stakeholders such as shareholders, employees, and the public. A significant portion of the report focuses on a PESTLE analysis, a strategic tool used to assess the macro-environmental factors impacting the company. This includes an examination of the political, economic, socio-cultural, technological, environmental, and legal factors influencing Talk Talk PLC. The report also discusses the purpose of PESTLE analysis and its advantages and disadvantages, concluding with an assessment of how these factors affect the company's operations and strategic decision-making. The analysis provides insights into the challenges and opportunities Talk Talk PLC faces within its operating environment.

BUSINESS ENVIRONMENT

Table of Contents
1.0 INTRODUCTION.....................................................................................................................1
MAIN BODY...................................................................................................................................1
2.0 TALK TALK PLC.....................................................................................................................1
2.1 Company Overview..............................................................................................................1
2.2 History...................................................................................................................................1
2.3 Organizational Structure.......................................................................................................3
3.0 GOVERNANCE OF TALK TALK PLC..................................................................................5
3.1 Stakeholders..........................................................................................................................5
3.2 A. Shareholders.....................................................................................................................5
3.3 B. Employees........................................................................................................................5
3.4 C The public..........................................................................................................................6
4.0 THE PURPOSE OF PESTLE ANALYSIS FOR AN ORGANIZATION................................6
5.0 PESTLE ANALYSIS OF TALK TALK PLC...........................................................................7
5.1 Political.................................................................................................................................7
5.2 Economic...............................................................................................................................7
5.3 Socio cultural........................................................................................................................8
5.4 Technological........................................................................................................................8
5.5 Environmental ......................................................................................................................8
5.6 Legal......................................................................................................................................8
6.0 CONCLUSION..........................................................................................................................8
REFERENCES ...............................................................................................................................1

1.0 INTRODUCTION
Business environment of company plays a crucial role in developing understanding over its
sustainability, governance and effectiveness of structuring. It is necessary for the firms to keep
check over its situation in order to manage stable organizational functions. The assessment will
outline structure and governance of Talk Talk Plc which is telecommunication company that
serve wide range of services like, pay television, mobile network and internet access services.
Further, the study will determine macro environment with the help of strategical tool that is
Pestle analysis.
MAIN BODY
2.0 TALK TALK PLC
2.1 Company Overview
Talk Talk PLC is telecommunication organization which provides B2B and B2C telecom
services. The focus of organization is on proving equal services to business and consumers of
United Kingdom. The company is leading value for money telecom provider to business and
business to consumer. The focus of firm is one making mobile services easily accessible and
affordable for all. The management provides broadband, fibre, money land line, mobile and
television services in homes of UK. The business offers simple plan and has flexible structure of
services in order to make services accessible to consumer (Babatunde and Adebisi, 2012).
Vision of organisation is to offer services at reasonable prices in order make telecom
reliable for all. However, mission of Talk Talk group is to offers telecommunication plans
reliable, fair and simple for all Home across UK. The values of company are focused on offering
simple telecom values in order to make switch cost affordable. The services of firm at market at
lowest possible prices in order gain trust of business and consumers across country. The goals of
group are based on 4 core elements that is reliable fibre, fairer plans, brilliant prices and switch
TalkTalk.
2.2 History
The company was founded in 1995 where telephone resellers services were provided
where the firm was used to provide fixed line voice services to only corporate consumers. With
growing success of 20000 corporate users the management started providing leasing modern
fiber lines in 2002. However, with enforcement of Communication Act by government in 2203
people across UK got opportunity to switch telecom services which gave huge rise and support
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to Talk Talk group. To encourage and support consumers shift the firm offered unlimited free
calls plan in 2004 which was a big time innovation in tele communication industry for the
business.
Figure 1: Business Model of Talk Talk Plc
(Source: Annual Report, 2018)
The innovation and management and continuous success helped the company in
becoming first internet provider of UK in 2011 which was the biggest advantage for the
management to remark the success and name of organization in entire country (Boons and
Lüdeke-Freund, 2013). Apparently, in 2013, IT teams launched first time network level blocking
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of unwanted calls which created boom in Telecom industry and helps users in blocking 20
million fake operators. Thus, in 2016, TalkTalk rolled out TalkSafe, by allowing 4 million
businesses and consumers to use their voice as their password instead of providing personal
details for proving their identity.
2.3 Organizational Structure
The structure of Talk Talk PLC is hierarchical and units are segregated according to
functional as well as division structuring where there are three divisions that is Board, N1 and
N2. The board consist of Chief executive officer, chairman of board, vice chairman and 7
directors (Voegtlin, Patzer and Scherer, 2012)). On the other hand, N1 division comprise chief
finical officer, human resource manager, interim and full fiber, interim and procurement, legal
affairs and secretary, technology and television.
However, the N2 division of Talk Talk Plc comprise functional department like IR and
reporting, leadership and talent, procurement, HR, HR and organization, technology, affairs and
regulation, mobile technology, network system and operations, network innovation, programmer
delivery, TV, web and application, content of television, marketing, commercial, service
management, sales, COO of consumer, strategy and finally operations (TalkTalk Telecom Group,
2018). The department in functional and divisional structure are interlinked with each other but
according to services and management of functions.
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Figure 2: Organisational Chart
(Source: TalkTalk Telecom Group, 2018)
Hierarchal structure of the organization demonstrates the information management of
firm which reduces the risk of mis communication and misleading. It is followed by Talk Talk
PLC because it enables clear view over all business operations and helps top management in
connecting with different department according to specific business situations. The company
manages is services nationally by partnering with primary address of consumer and small
business markets, fibre, broadband and by delivering voice services. The wholesale offering
allows management to work with systems integrators, such as Fujitsu, which frequently
combines connectivity and data solutions from multiple providers to offer large consumers.
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3.0 GOVERNANCE OF TALK TALK PLC
The business is governed by commitment of board which aim at meeting the highest
standard of corporate governance according to rules and regulations stated in UK listing
authority and UK governance code which are enforced by financial reporting council. The
governance of company is based on five key principles that is effectiveness, leadership,
remuneration, relation with stakeholders and accountability (Avramenko, 2012). Further, the
focus of board members is on creating culture of transparency which helps the business in
making open contrition for its stakeholders.
The company is governed by Board directors which are 4 executives of Talk Talk PLC that
is Charles Sunstone who is executive chairman, Tristia Harrison who is Chief executive officer,
Charles Bligh Chief operating officer and Kate Ferry who is chief financial officer. These are the
leading and governing personalities of group (Annual Report, 2018). Apart from this the firm has
8 non executives which comprise, senior independent director, deputy chairman, Group general
counsel and company secretary and 5 non-executive directors. On the other hand, the company is
governed by governmental regulations and federal communications commission which controls
intrastate pricing, foreign communication and competition. CEO of the company is elected by
management members as the individuals are focused on making corporate decision and
managing operational resources of company.
3.1 Stakeholders
Stakeholders are the independent individuals which shred specific interest with company
and its services. The focus of Board of Talk Talk PLC is to explain developments of business to
its all stakeholders in order to keep them connected with business and its growth. For example
the stakeholder relationship of Talk Talk Plc is maintained by CFO and CEO of company who
are focused on maintaining relationship with investors with the help of investor relations
manager.
3.2 A. Shareholders
Shareholders are key investors of the company which helps in regulating business capital.
There are different types of shareholders like investors of Talk Talk plc are, fund managers,
retail brokers, credit investor, and institutional shareholders. The relationship management of
Board of directors with shareholders is based on meeting their each any every requirement by
providing them detailed information about every organizational (Aguilera and Crespi-Cladera,
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2016). Moreover, keeps a regular check over shareholder with the help of periodic reports and
the communication between investor and executives occurs in Annual general meeting where the
chairman shared detailed information about progress of firm.
3.3 B. Employees
Employees are considered as key stakeholders of company and the individual are
responsible for running regular business operations. There are total 2.35 k employees in Talktalk
Telecom Group PLC. Employee satisfaction is the key priority of telecommunication
organisation where the focus of firm is on fulfilling psychological and self-esteem needs of
workers. In addition, the firm has complied with corporate social responsibility in order to enable
equal employee benefits which comprise bonus, incentives, etc. Further, the organisation has
enabled safe working condition and culture at workplace to serve employee satisfaction.
However, the board members OF Talktalk Telecom Group PLC communicate with employee via
non executives officer and therefore considered as employee voice.
3.4 C The public
Executives may not have direct interaction with public but the focus of firm is on managing
public benefits and welfare. The schemes and telecom plans offered be organization are on the
basis of market research. The unlimited calling plans are launched according to customers’ needs
and pricing is done by incorporating competitive pricing strategy.
Apart from this, relationship of board with public is maintained by different programs for
example the company contributes in social welfare and education awareness of society. Further
the group has complied with corporate social responsibility with the motive maintaining
sustainable performance by focusing on environmental and social impacts. In this the focus of
company is on preserving natural resources and making optimum utilisation of resources.
4.0 THE PURPOSE OF PESTLE ANALYSIS FOR AN ORGANIZATION
PESTLE analysis is a strategical tool which helps the business in developing critical
understanding over its external business environment. It is used by most business enterprise to
determining changes in external markets which can hinder growth of company (Schaltegger and
Wagner, 2017). It is the most common tool used for deriving changes in technology, political
instability, etc. For example, technological analysis is done by firm to evaluate the latest
technology which can assist the management in making services cost effective in order to
manage stability in consumer satisfaction and profits. Apart from this there is legal analysis
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which helps in determining c change in regulation for particular industry in order to avoid breach
of regulations.
The major purpose of using this strategical is to keep control over external environmental
changes which can be a barrier to sustainable business performance. The major advantage of
implanting use of Pestle analysis in Talk Talk plc is to attain cost effectiveness of services as it
helps in managing clear overview over changing socio cultural needs of buyers. Moreover, it
assists in analyzing political instability which can disrupt entire management system. On the
other the strategical analysis does not provide stable outcome of results and therefore can be
threat of change in company. Moreover, it does not provide simple presentation over change
management where gathering vast information is time consuming and is not easy. Thus, it can be
said the PESTLE analysis enable opportunity for firm to gather understanding over its industry,
market and customers to make necessary changes.
5.0 PESTLE ANALYSIS OF TALK TALK PLC
5.1 Political
Political changes are unstable and therefore it is the foremost responsibility of an
organization to keep a regular check over fluctuating government policies and plans. The Talk
Talk group is regulating in telecommunication industry which undergo huge political
fluctuations (Ho, 2014). For example, the group has risk of military invasion and interference of
governmental rule and regulation in telecom services. In addition, it is important for the company
to comply with wage legislation where it is the responsibility of organization to provide
minimum wages to each employee exclusion of overtime. Apart from this, enabling mandatory
employee benefits and incentives regardless of profits and losses of firm is essential for Telecom
group.
The serious issue which act as an example for political fluctuation where company faced
monetary penalty under Section 55A of data protection Act 1998 which was issue for
contravention of 7th data protection by organization. In accordance with this, it is import for the
group to focus on intellection property protection and to have appropriate legal framework for
enforcing contract. Thus, it can be said the compliance with fluctuating regulations helps the firm
in managing smooth and systematic flow in business activities.
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5.2 Economic
The most common and fluctuation actors of external environment is economic condition
which comprise changes in rates of savings, interest, foreign exchange, inflation, etc. There is
various interference faced by Talk Talk group which hindered smooth flow of services like, free
market of telecommunication industry was intervened by government via change in tariffs. Apart
from this, education and skill level in industry lacks knowledge of technology and innovation
because of which Talk group investment huge cost of employees training and development
sessions.
In addition, economic fluctuation includes labor cost, unemployment rate, interest rate,
inflation, discretionary income, etc. For exampling the company is not much involved in cross
border transactions and therefore the risk of increase in interest rate is managed by group via
swap. Like the company fix change in interest rate via net debt over weighted average period.
5.3 Socio-cultural-
Social cultural factors of company are regulated by demographics that is skill level of the
population. Further, in this focus of telcom firm in class, structure and education level of society.
This helps in enabling different types of services t meet needs to every type of customers.
Increase in immigrants promotes the need of market analysis and new schemes according to
temporary residents. For example students who stage in country just for education purpose.
However, to gain their attention the company provides cost effective and temporary schemes.
The culture and way of doing the impacts highly on the culture of the organizations. Thus, shared
beliefs and attitudes of population plays one of crucial role In terms to have deep influence on
the industry and profitability. The connectivity is central to so many things and that is inclusive
of work and entertainment. There are major number of people who are using social media
activities for the fun and business. Furthermore, higher number of individuals are using social
media for business. As per the modern scenario, there are various people who are becoming
health conscious and take the use of wrist bands to track physical activity. In addition to this, the
high standard trends of Morden life have proved high favourable for the telecom industry.
5.4 Technological
Technological advancement works as to influence the company operations in the huge
context. Thus, the use of mobile computing is rise and things as cloud computing and computers
have become the core of productivity. The technological forces are plying the crucial role and
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that also affects the Telecom industry. With the advent of technical process, the whole individual
uses to relay over the operation activities of the enterprise (Kimani and Ogutu, 2018). There are
number of the industries that are high depend over the technological disruption and it affects the
working of the organization in the huge context. Thus, Talk Talk Plc is technology driven
company and it focus on the latest trends of technology.
5.5 Environmental
The Telecommunication industry affects the working of the enterprise in the huge
context. It is large part of e-wasted generated every year. The industry is majorly focusing over
the issue as waste management and there is need to minimize the environmental footprints. They
uses to make direct contribution to the production of e-waste, providers like verizon and other
device that helps to enlarge the function of business (Chowdhury, 2018.). Thus, the
environmental factors can impact the working of the enterprise and they must taken initiative in
order to promote effective and fast working to the activities of the firm.
5.6 Legal
The Talk Talk Plc is global company and operating its business functions effectively.
Thus, it can be said that firm has to be vigilant in terms to the legal issues. Thus, it can be said
that the globally legal compliance gives rise to big risk for the Telecom providers. In addition to
this, there are various kind of laws that must be inclusive of the telemarketing and privacy that
the providers must comply with it. Furthermore, this firm also been accused of not paying this
much to the employees as compare to rivals. The staff works in firm often leaves and joins rival
companies in terms to maximize the risk of leakage of the innovative ideas (Tang and Demeritt,
2018). In addition to this, Talk Talk Plc should always be abide by the legal issues of the domain
in terms to increase the customers and maintain a positive image in the market. This kind of
activities will also be helpful in terms to gaining the trust of the customers.
6.0 CONCLUSION
The assessment part one summarized about business environment of Talk Talk Plc by
evaluating its structure and governance from where it is evaluated that the company has 4
executives which are hierarchically connected with non executives and functional department of
an organization. In addition, it outlined relation of board of telecommunication with public,
customers, employees and its shareholders. Thus, in part two report concluded macro
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environment by analyzing political, social, economical, legal, environmental environment of
group with the help of relevant examples.
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REFERENCES
Books and Journals
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Avramenko, A., 2012. Enhancing students' employability through business
simulation. Education+ Training. 54(5). pp.355-367.
Babatunde, B.O. and Adebisi, A.O., 2012. Strategic Environmental Scanning and Organization
Performance in a Competitive Business Environment. Economic Insights-Trends &
Challenges. 64(1).
Boons, F. and Lüdeke-Freund, F., 2013. Business models for sustainable innovation: state-of-the-
art and steps towards a research agenda. Journal of Cleaner production. 45. pp.9-19.
Chowdhury, A., 2018. Assessing Customer Satisfaction of Grameenphone (Doctoral dissertation,
Daffodil International University).
Ho, J.K.K., 2014. Formulation of a systemic PEST analysis for strategic analysis. European
academic research. 2(5). pp.6478-6492.
Kimani, G.K. and Ogutu, M., 2018. THE EFFECT OF EXTERNAL ENVIRONMENT AND
FIRM SIZE ON THE RELATIONSHIP BETWEEN KNOWLEDGE MANAGEMENT
AND COMPETITIVE ADVANTAGE. European Journal of Business and Strategic
Management. 2(9). pp.71-84.
Schaltegger, S. and Wagner, M., 2017. Managing the business case for sustainability: The
integration of social, environmental and economic performance. Routledge.
Tang, S. and Demeritt, D., 2018. Climate change and mandatory carbon reporting: Impacts on
business process and performance. Business Strategy and the Environment. 27(4). pp.437-
455.
Voegtlin, C., Patzer, M. and Scherer, A.G., 2012. Responsible leadership in global business: A
new approach to leadership and its multi-level outcomes. Journal of Business Ethics.
105(1). pp.1-16.
Online
Annual Report. 2018. [Online]. Available through:
<https://www.talktalkgroup.com/dam/jcr:ad5e4acb-8e7e-40f5-9525-ff4b33dbccaa/
TalkTalk%20Annual%20Report%202018.pdf >.
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TalkTalk Telecom Group. 2018. [Online]. Available through: <
https://www.theofficialboard.com/org-chart/talktalk-telecom-group >.
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