MBA600 Capstone: Strategic Analysis of Telstra Presentation

This presentation provides a strategic analysis of Telstra, a leading Australian telecommunications company. It begins with an introduction and an overview of Telstra, followed by an examination of its external environment using the PESTLE framework, covering political, economic, social, technological, environmental, and legal factors. The internal environment is analyzed using the VRIO framework to identify competitive advantages. The presentation highlights Telstra's strengths and weaknesses, focusing on the sources and sustainability of its competitive advantages, particularly its differentiation and innovation strategy. The conclusion summarizes the key findings, emphasizing Telstra's opportunities and challenges within the Australian and international markets, as well as references used for the analysis.

T E L S T R A
PROJECT MANAGEMENT

INTRODUCTION
• In this presentation, various strategic
management concepts have been explained
outlining the company as Telstra – Australian
leading telecommunication.
• Some of these strategic management concepts
are PESTLE framework, SWOT tool, VRIO resource
based view and so forth.

TELSTRA OVERVIEW
• Telstra is a leading telecom enterprise based in
Australia and founded in 1975.
• At present, the company is offering its
telecommunication services in more than 20
nations (telstra.com.au, 2020).
• The mission of Telstra is to improve ways the
consumers live and work through connections.

ANALYSIS OF EXTERNAL ENVIRONMENT -
PESTEL
• Political Factors - Greater political stability in
the business environment is very important. In
case of Telstra, such factors push from
government for regulatory reforms and Australia
cordial international diplomatic relations.
• Economical Factors – Economic factors in case
of Telstra may include Subdued GDP as of
deteriorating commodity prices can have a
significant influence.
• Social Factors - It requires Telstra to recognise
consumer lifestyle, beliefs, culture and
behaviour.
Econo
mic
Politic
al
Social Technologic
al
LegalEnvironment
al

ANALYSIS OF EXTERNAL ENVIRONMENT -
PESTEL
• Technological Factors – The
technological diffusion around the world
offers Telstra an opportunity towards
investment in digitization.
• Environmental Factors - Increasing
environmental concern requires Telstra to
come up with solutions for sustainability.
• Legal Factors – Telstra in Australia
market have to face regulatory changes
from ACCC and other compliances.
Econo
mic
Politic
al
Social Technologic
al
LegalEnvironment
al

ANALYSIS OF EXTERNAL ENVIRONMENT–
PORTER FIVE FORCES
Porter’s Five Forces Intensity (High/
Medium/ Low)
Customers bargaining power High
Suppliers bargaining power Moderate
Intensity of competitive rivalry High
Threat of substitutes Moderate
Threat of new entrants Low

ANALYSIS OF INTERNAL ENVIRONMENT
- VRIO
Resource
or
capability
Valuable Rare
Imitable or
Non-
substituta
ble
Organized
to Exploit
Competiti
ve
Implicatio
n
Robust
internation
al
existence
Yes Yes Yes Yes
Sustained
competitive
advantage
Big user
base Yes Yes Yes Yes
Sustained
competitive
advantage
Robust
finance Yes Yes Yes Yes
Sustained
competitive
advantage
Marketing
and
Innovation
Yes Yes Yes Yes
Sustained
competitive
advantage
Extensive
portfolio of
product
Yes Yes No -
Temporary
competitive
advantage

COMPETITIVE ADVANTAGE IDENTIFIED
• Through the internal analysis of the Telstra business
environment, the company has gained sustained
competitive advantage in many areas such as
international presence, larger customer base,
innovation and marketing and strong finance.
• However, one of the major competitive advantages of
Telstra is its differentiation and innovation strategy.

STRENGTHS AND WEAKNESSES
Strengths
 In Australia, Telstra has gained a
dominant position in the
telecommunication industry.
 Telstra has developed long term and
positive relationships with regulatory
bodies in Australia.
 The company financial position is very
strong allowing them to easily invest
into new technology and innovation.
Weakness
 In relation with the rivals, Telstra
services and networks are more costly.
 In comparison with Vodafone and
Optus, there is higher latency issues
with Telstra.

SOURCES AND FUTURE SUSTAINABILITY OF
COMPETITIVE ADVANTAGE
• The source of Telstra competitive advantage is
associated to their network and technological
capabilities.
• In relation to their future sustainability of competitive
advantage, Telstra has a capability to drive a step
change in consumer experience with enabling rapid
product and marketplace innovation.

CONCLUSION
• Telstra is successfully offering its premium products
and services to a wide range of population both
domestically and internationally.
• Telstra has various opportunities such as to expand in
global marketplaces such as Asia-Pacific and China.
• However, the company have to also confront risks
positively that in case of Telstra includes complex
ACCC regulations and Australia saturated industry
environment.

REFERENCES
• Reichert, C. (2018) Telstra FY18 profit down by AU$345m ahead of nationwide 5G
launch [ONLINE] Available from: https://www.zdnet.com/article/telstra-fy18-profit-
down-by-au345m-ahead-of-nationwide-5g-launch/[Accessed 12/04/2020].
• Williams, B. and Figueiredo, J., 2014. Lessons from an innovation-leader and tools to
learn them. Journal of Industrial Engineering and Management, 7(4), pp.932-960.
• telstra.com.au. (2020) Telstra International [ONLINE] Available from:
https://www.telstra.com.au/aboutus/telstra-international [Accessed 12/04/2020].
• Mason, M. (2018) Telstra may cut mobile prices in wake of aggressive push from
Optus and Vodafone[ONLINE] Available from:
https://www.afr.com/companies/telecommunications/telstra-may-cut-mobile-prices-in-
wake-of-aggressive-push-from-optus-and-vodafone-20181005-h1698k [Accessed
12/04/2020].
• Denholm, R. (2018) Networks and digital technology – the building blocks of Telstra’s
strategy[ONLINE] Available from: https://exchange.telstra.com.au/networks-and-
digital-technology-the-building-blocks-of-telstras-strategy/[Accessed 12/04/2020].

REFERENCES
• Reichert, C. (2018a) Federal Court orders Telstra to pay AU$10m fine[ONLINE]
Available from: https://www.zdnet.com/article/federal-court-orders-telstra-to-pay-
au10m-fine/ [Accessed 12/04/2020].
• Song, J.J. and Sung, H., 2015. A study on relation between strategic attributes of
technological resources and competitive advantage: Empirical analysis of VRIO
framework by using technology evaluation results of technology based SMEs. Journal
of Korea Technology Innovation Society, 18(3), pp.416-443.
• telstra.com.au. (2019) Telstra Annual Report 2019[ONLINE] Available from:
https://www.telstra.com.au/content/dam/tcom/about-us/investors/pdf%20F/2019-
Annual-Report.PDF [Accessed 12/04/2020].
• Cardy, J. (2019) 4 technology projects our teams are working on this year[ONLINE]
Available from: https://exchange.telstra.com.au/4-technology-projects-teams-working-
year/ [Accessed 12/04/2020].