International Management Report: Telstra's Expansion in Germany

This report analyzes Telstra's international management strategies focusing on its potential expansion into Germany. It begins with an introduction to Telstra and the relevant macro-environmental factors in Germany, followed by an analysis of market entry strategies, recommending a greenfield investment approach. The report then proposes an international organizational structure for Telstra, suggesting a divisional structure with local leadership. It delves into international HR management, emphasizing the importance of cultural intelligence, communication, motivation, and leadership for cross-cultural teams, including the application of Herzberg's Motivation Hygiene theory. Furthermore, the report outlines an international strategy for Telstra, incorporating Porter’s theory of national competitive advantage, and considers marketing implications. Finally, it provides recommendations for potential benefits, risks, and necessary changes for Telstra to operate successfully in Germany, concluding with a summary of the key findings and strategic recommendations.

Running head: INTERNATIONAL MANAGEMENT OF TELSTRA
INTERNATIONAL MANAGEMENT OF TELSTRA
Name of the Student
Name of the University
Author Note

1INTERNATIONAL MANAGEMENT OF TELSTRA
Executive Summary
The report is based on the study of the international growth based plans that have been
made by Telstra which is a major telecommunications based organization. The entry
mode that can be implemented by Telstra and the macro environment based factors have
also been discussed in the report. The structures that can be developed by Telstra in
Germany and the strategies to be implemented are an important part of the discussion as
well. Recommendations have been provided based on the methods by which Telstra can
improve its processes in the future with the help of appropriate development of strategies
in Germany.

2INTERNATIONAL MANAGEMENT OF TELSTRA
Table of Contents
3. Introduction to the report, brief background of the company....................................3
4. Brief summary of key macro issues relevant to chosen country................................3
5. Market analysis and entry mode strategy with justifications.....................................4
6. Proposal of international organization structure for the company with justification.6
7. Methods and strategies for international HR management, communications,
motivation and leadership for cross-cultural teams...................................................................6
8. International strategy for the company and application of Porter’s theory of national
competitive advantage................................................................................................................9
9. Marketing considerations.........................................................................................10
10. Recommendations for potential benefits, risks and changes to the company to
operate in country chosen.........................................................................................................11
11. Conclusion..............................................................................................................12
12. References..............................................................................................................13

3INTERNATIONAL MANAGEMENT OF TELSTRA
3. Introduction to the report, brief background of the company
Global or international activities that are performed by a company are mainly based
on the operations that are performed in various countries. Global expansion is thereby able to
imply that the countries need to make investments outside the home country in order to
enhance the profitability levels in an effective way. The presence of the business operations
in different countries is considered to be a major part of the results that are gained after global
expansion of operations (Bjola & Kornprobst, 2018). The report will be built on the detailed
analysis of key macro environment based issues that are relevant to the operations of the
company in the chosen country. Market entry strategy and market analysis will also be an
important of the report. Structural changes that need to be applied by the company will be
discussed in the report in detail. Strategies related to HR management and communications
will also analysed in the report in detail. Recommendations will be provided based on future
processes of the firm in the country. The organization that has been chosen for analysis in the
report is Telstra.
Telstra Corporation Limited is a telecommunications based organization of Australian
origin that aims at developing its networks that are based on services provided based on
mobile, voice, pay television, internet access. The company has been able to develop a long
history the in the country based on its origins with the Australia Post as Postmaster General
Department. Telstra has however been privatised and the company is also currently
undergoing a change based program in order to become more customer focussed in nature
(Telstra.com.au. 2019).
4. Brief summary of key macro issues relevant to chosen country
The political environment that has been developed in Germany is based on the
independent judiciary based system of the constitutional courts. The Federal Constitutional

4INTERNATIONAL MANAGEMENT OF TELSTRA
Court is considered to be the topmost court in the country and is responsible for protecting
the rights of the citizens as well. The changes that have been recently implemented in the no
intervention policy of the country were based on the external pressures that are faced by the
government (Brannen, Piekkari & Tietze, 2017). Constitutional law of the country also has an
impact on the legal system of Germany. Foreign companies are mainly attracted towards the
country due to the legal stability that has been gained by the country. Patents and trademarks
are also responsible to protect the organizations that enter the country (Buckley, Doh &
Benischke, 2017).
The large size of German economy is a major factor that has the ability to attract
foreign based organizations from different parts of the world. Germany is a modern and
multicultural country that can provide a favourable business ambience to the foreign
organizations. Telstra will also be able to take advantage of the situation and enhance the
levels of revenues that can be gained in the telecommunications based industry of the country
(Cascio & Boudreau, 2016). The multicultural environment of Germany will be able to
support the operations of the company and fulfil the needs based on developing a major
international presence. The diverse environment of Germany is considered to be an important
part of the opportunities that are provided to an organization like Telstra that operates in the
highly competitive telecommunications based industry (Cavusgil & Knight, 2015).
5. Market analysis and entry mode strategy with justifications
Germany is considered to be one of the biggest telecom based markets that has the
ability to penetrate the market in a massive manner in the mobile and broadband based
sectors. The organization named Telekom Deutschland has dominated broadband markets
and the fixed network based market of the country. The other major players who are a part of
the country include Vodafone, Freenet and Telefonica. Telekom Deutschland of Germany

5INTERNATIONAL MANAGEMENT OF TELSTRA
mainly focusses on the infrastructure of fixed networks in the country (Cuervo-Cazurra,
2016). Various mobile based technologies that are a part of the telecommunications market
include GSM, HSPA, 3G, 5G and LTE. The services and software of Germany’s Telecom
industry are able to generate revenues from the proper designing and integration, installation,
maintenance, on-site based service monitoring, resource training, site monitoring based
software (Cuervo-Cazurra, Narula & Un, 2015).
The revenues generated by the telecom industry of Germany had started declining in
the last few years. The government of the country has however planned to make an
investment of greater than one Billion in the proper development of infrastructure. The
pressure that is being faced by the telecom industry of Germany is mainly based on the
development of a gigabit society within the year 2025. The growth that has been experienced
in the digital economy of Germany has led to the enhancement of consumer demands for the
development of sophisticated electronics (Dikova & Brouthers, 2016).
Greenfield investment based market entry strategy can be applied by Telstra in order
to start its processes in Germany. The strategy of greenfield investment is mainly related to
the highest levels of involvement that can be developed by Telstra in order to offer its
services to the consumers in the country. Telstra will aim at the development of facilities in
the new market area or country in order to cater to the needs of customers in the country. The
risks are mainly faced by Telstra based on the methods by which government regulations can
influence the organization and its operations (Dunne & Reus-Smit, 2017). The process of
greenfield investment is considered to be the most capital intensive method that can be used
by Telstra in order to enter a country like Germany. The regulations that are developed by
Telstra are influenced by the regulations of the government of the country (Ferlie & Ongaro,
2015). Telstra will have to develop its operations based on the methods by which various

6INTERNATIONAL MANAGEMENT OF TELSTRA
regulations can influence the organization and the process of profit making of the company as
well.
6. Proposal of international organization structure for the company with justification
The current organizational structure that is developed by Telstra is considered to be
divisional in nature and various departments of the company work under the supervision of
the CEO. The organization has recently implemented some major changes in the top line
based structure and the leadership team. The new organizational structure has been developed
by Telstra is mainly based on the variations that have been made in the leadership of the
organization (Gaur & Delios, 2015). Major part of the changes made in the organizational
structure are related to the proper simplification of the services and products in order to
deliver the requirements in a rapid manner. The members of the leadership team are provided
with more responsibilities due to changes that have taken place in the structure (Hitt, Li &
Xu, 2016). The changed organizational structure of Telstra can be followed in Germany as
well. The company can develop its executive team in Germany with the help of local
employees who can be placed as managers of various departments. Although all the
departments will be under the direct supervision of the CEOs, the levels of responsibilities
that have been provided to them will be mainly based on the performance that has been
depicted by them (Klabbers, 2017).
7. Methods and strategies for international HR management, communications,
motivation and leadership for cross-cultural teams
International HR management - The Human Resource or HR departments of the
organizations can face major issues in the appropriate management of the cross-cultural
teams. The issues are mainly faced by the HR teams based on running various departments
and implementing the policies in various departments of the organization. The HR teams in

7INTERNATIONAL MANAGEMENT OF TELSTRA
the organizations have thereby started facing issues in the ways by which the employees can
be managed. Retention of employees is an issue that can be faced by the HR managers of
Telstra in the operations that will be started in Germany (Knight & Liesch, 2016). HR
managers thereby need to develop a proper balance between the incentives, remuneration and
the culture of the firm as well. HR managers of Telstra need to recruit the talented employees
from Germany itself in order to ensure that the local communities can get the benefit of the
operations of a foreign organization (Kotabe & Kothari, 2016). The development of an
integrated HR platform is considered to be a vital aspect that has an influence on the ways by
which Telstra can track the productivity levels of the employees. Training is also considered
to be a major responsibility that needs to be fulfilled by the HR department of Telstra in order
to enhance the cultural intelligence of the employees (Lasserre, 2017). Levels of cultural
intelligence will have an impact on the tolerance that is developed by the employees towards
the culture of Germany. Diversity of cross cultural employees is considered to be a key factor
that has to be taken into consideration by the HR managers of Telstra in order to manage the
operations in a profitable manner (Luo & Zhang, 2016).
Communications of Telstra in Germany – The communication process that is
developed by Telstra with the employees in Germany will be able to play a key part in
maintaining the profitability levels. The management of Telstra needs to communicate with
the local employees in order to understand their demands and needs (Marano et al., 2016).
The cultural issues that can be faced by the employees will be solved in an effective manner
with the support that is offered by the communication process. The employees will be able to
manage their work process effectively with the help that is provided by the managers and the
individuals who belong to the top level management of the organization as well (Nason &
Wiklund, 2018).

8INTERNATIONAL MANAGEMENT OF TELSTRA
Motivation and leadership in Telstra – Herzberg’s Motivation Hygiene theory can be
applied by Telstra in order to develop the motivation levels among the employees of the firm.
The theory was proposed by Frederick Herzberg and is also known as the Two-Factor theory.
The factors that are under the motivation based aspect of model are considered to be positive
in nature and those which fall under the hygiene aspect are negative (Thussu, 2018). The
motivating factors that have been discussed in the model include job satisfaction,
achievement, recognition, work itself, responsibility, advancement and growth. The factors
that can influence the motivation levels in a negative manner include administration and
company policy, supervision, working conditions, interpersonal relations, status, salary and
security (Wu et al., 2016). The increase in levels of the hygiene factors can lead to the
reduction of motivation levels of the employees who are a part of the organization. On the
other hand, increase in motivational factors will be able to enhance the motivation levels of
employees who are a part of the organization. Telstra will be able to maintain the motivation
levels of employees by increasing the levels of impact of the motivation factors (Yan & Luo,
2016).
Leadership style that can be applied by the managers of Telstra in order to manage
the operations of the firm in Germany is termed as the transformational leadership. The
vision has to be developed by the managers of Telstra in order to manage the operations and
employees of the firm as well. Leader will be able to play a key part in providing inspiration
to the employees so that they can go beyond the requirements of the tasks (Wu et al., 2016).
Transformational leadership is thereby developed at different levels of the firm in order to
accomplish the work process of the employees in an effective manner. The charismatic
appeal of the leaders or managers of Telstra will be able to support visionary nature of the
leaders (Zander, McDougall-Covin & Rose, 2015).

9INTERNATIONAL MANAGEMENT OF TELSTRA
8. International strategy for the company and application of Porter’s theory of national
competitive advantage
The corporate strategy that has been recently implemented by Telstra is able to offer
support to the organization in order to maintain its competitive advantage on a global basis.
The corporate strategy developed by Telstra is termed as Telstra 2022 that is based on the
proper simplification of the products and services of the organization in order to reduce the
cost base. The company also aims at improving the customer experience in order to address
their pain points and to create the digital experiences as well (Yan & Luo, 2016).
Simplifications of the product offerings are able to play a key part in the methods by which a
company like Telstra can fulfil the demands and needs of the customers. The company will
also aim at the development of a standalone business unit in order to drive the performance
levels of the employees (Nason & Wiklund, 2018).
Telstra will also aim at the simplification of the structure of its business operations in
order to provide empowerment to the people or employees who are a part of the operations.
The corporate strategy of Telstra that has been implemented by the organization in its home
country will be able to play a major part in the development of its operations on a global basis
(Cuervo-Cazurra, Narula & Un, 2015). The company will aim at analysing the types of
customers who will be targeted in Germany. The proper analysis of customer types will be
able to play a main part in the methods by which Telstra is able to develop the product
portfolio to be offered in the country. The company will also analyse the market size in order
to develop the international processes in an effective manner (Dunne & Reus-Smit, 2017).
The theory of national competitive advantage mainly states that the home country of
an organization is crucial for the success that is gained by an organization in international
markets. The four different aspects that are a part of the Porter’s Diamond model related to
Telstra include the following,

10INTERNATIONAL MANAGEMENT OF TELSTRA
 Factors of production – The production of products and services of Telstra
are supported by the human resources and infrastructure that has been
developed by the firm.
 Demand conditions – The market size of telecommunications industry of
Telstra is able to play a key part in influencing the levels of profitability. The
demands of services of Telstra in Germany are influenced by the customer
base that it has in the home country (Dikova & Brouthers, 2016).
 Related industries – The growth of usage of technologies are able to play a
key part in the methods by which telecommunications industry can maintain
the processes. Telstra has also improved its operations in the last few years
due to effective changes that have taken place in the technology usage levels.
 Firm strategy, rivalry and structure - The strategy that has been implemented
by Telstra is mainly based on the development of international operations of
the organization and facing competition with the help of its services (Bjola &
Kornprobst, 2018).
9. Marketing considerations
The marketing and promotions of Telstra will be based on the marketing mix that has
been formed by the company in order to start its processes in a different country.
Products – The strategy of marketing of Telstra is able to reflect the needs and
demands of the customers. The unique design of services and products of Telstra will have
the organization to develop a competitive advantage in Germany.
Pricing – Telstra has chosen the price penetration based strategy in order to decide the
prices of products that will be offered to the consumers in Germany. The pricing based

11INTERNATIONAL MANAGEMENT OF TELSTRA
strategy of Telstra will also be helpful in setting list price, discounts, payment periods and
credit terms as well (Dikova & Brouthers, 2016).
Place or distribution – The development of distribution networks of Telstra is mainly
based on the reach towards the customers in Germany that has been developed by the
organization. The physical stores and website of Telstra are able to fulfil the needs and
demands of customers and increase the awareness levels as well.
Promotion – Telstra aims at implementing a combination of the below the line
strategies of promotion in order to accomplish the marketing objectives. The messages are
crafted in such a manner that has the ability to influence the behaviour of consumers in the
telecommunications industry of Germany (Hitt, Li & Xu, 2016).
The promotional and advertisement based strategies that have been developed by
Telstra will be able to play a key part in the methods by which the company can improve the
levels of profitability. The development of a huge customer base is also considered to be an
vital aspect that has an influence on the organization as a whole (Dikova & Brouthers, 2016).
10. Recommendations for potential benefits, risks and changes to the company to
operate in country chosen
The major recommendations that can be provided to Telstra in order to maintain its
position in Germany are as follows,
 Development of promotional strategies that can help Telstra to enhance the
awareness levels of the company in minds of the consumers.
 The risks based on implementation of Greenfield investments to start the
operations of Telstra in telecommunications can be mitigated by the company
by aiming at reaching the customers faster with the help of digital channels.

12INTERNATIONAL MANAGEMENT OF TELSTRA
 The discounts that are provided by Telstra to the customers can play a key role
in improvement of the sales of the company in the industry.
11. Conclusion
The report can be concluded by stating that Telstra will be able to develop its
processes in Germany in a successful manner with the help of effective strategies and
leadership quality as well. The motivational factors can also have an influence on the proper
management of cross cultural employees in the organization. The management of effective
organizational culture and environment is considered to be a major aspect that will lead to the
success that can be gained by Telstra in telecommunications industry.

13INTERNATIONAL MANAGEMENT OF TELSTRA
12. References
Bjola, C., & Kornprobst, M. (2018). Understanding international diplomacy: theory,
practice and ethics. Routledge.
Brannen, M. Y., Piekkari, R., & Tietze, S. (2017). The multifaceted role of language in
international business: Unpacking the forms, functions and features of a critical
challenge to MNC theory and performance. In Language in international
business (pp. 139-162). Palgrave Macmillan, Cham.
Buckley, P. J., Doh, J. P., & Benischke, M. H. (2017). Towards a renaissance in international
business research? Big questions, grand challenges, and the future of IB
scholarship. Journal of International Business Studies, 48(9), 1045-1064.
Cascio, W. F., & Boudreau, J. W. (2016). The search for global competence: From
international HR to talent management. Journal of World Business,51(1), 103-114.
Cavusgil, S. T., & Knight, G. (2015). The born global firm: An entrepreneurial and
capabilities perspective on early and rapid internationalization. Journal of
International Business Studies, 46(1), 3-16.
Cuervo-Cazurra, A. (2016). Multilatinas as sources of new research insights: The learning
and escape drivers of international expansion. Journal of Business Research, 69(6),
1963-1972.
Cuervo-Cazurra, A., Narula, R., & Un, C. A. (2015). Internationalization motives: Sell more,
buy better, upgrade and escape. The Multinational Business Review, 23(1), 25-35.
Dikova, D., & Brouthers, K. (2016). International establishment mode choice: Past, present
and future. Management International Review, 56(4), 489-530.

14INTERNATIONAL MANAGEMENT OF TELSTRA
Dunne, T., & Reus-Smit, C. (Eds.). (2017). The globalization of international society. Oxford
University Press.
Ferlie, E., & Ongaro, E. (2015). Strategic management in public services organizations:
Concepts, schools and contemporary issues. Routledge.
Gaur, A., & Delios, A. (2015). International diversification of emerging market firms: The
role of ownership structure and group affiliation. Management International
Review, 55(2), 235-253.
Hitt, M. A., Li, D., & Xu, K. (2016). International strategy: From local to global and
beyond. Journal of World Business, 51(1), 58-73.
Klabbers, J. (2017). The life and times of the law of international organizations.
In International Organizations (pp. 151-181). Routledge.
Knight, G. A., & Liesch, P. W. (2016). Internationalization: From incremental to born
global. Journal of World Business, 51(1), 93-102.
Kotabe, M., & Kothari, T. (2016). Emerging market multinational companies’ evolutionary
paths to building a competitive advantage from emerging markets to developed
countries. Journal of World Business, 51(5), 729-743.
Lasserre, P. (2017). Global strategic management. Macmillan International Higher Education.
Luo, Y., & Zhang, H. (2016). Emerging market MNEs: Qualitative review and theoretical
directions. Journal of International Management, 22(4), 333-350.
Marano, V., Arregle, J. L., Hitt, M. A., Spadafora, E., & van Essen, M. (2016). Home country
institutions and the internationalization-performance relationship: A meta-analytic
review. Journal of Management, 42(5), 1075-1110.

15INTERNATIONAL MANAGEMENT OF TELSTRA
Nason, R. S., & Wiklund, J. (2018). An assessment of resource-based theorizing on firm
growth and suggestions for the future. Journal of Management, 44(1), 32-60.
Telstra.com.au. (2019). Telstra - Our corporate strategy. Retrieved 26 September 2019, from
https://www.telstra.com.au/aboutus/our-company/future/Ourcorporatestrategy
Thussu, D. K. (2018). International communication: Continuity and change. Bloomsbury
Publishing.
Wu, J., Wang, C., Hong, J., Piperopoulos, P., & Zhuo, S. (2016). Internationalization and
innovation performance of emerging market enterprises: The role of host-country
institutional development. Journal of World Business, 51(2), 251-263.
Yan, A., & Luo, Y. (2016). International Joint Ventures: Theory and Practice: Theory and
Practice. Routledge.
Zander, I., McDougall-Covin, P., & Rose, E. L. (2015). Born globals and international
business: Evolution of a field of research. Journal of International Business
Studies, 46(1), 27-35.