Applied Corporate Strategy: Vodafone's Strategic Analysis Report

This report presents a strategic analysis of Vodafone, a leading telecommunications company. It begins with an external analysis using PESTLE and Porter's Five Forces to identify opportunities, threats, and industry attractiveness. The internal analysis assesses Vodafone's resources and key competencies, pinpointing strengths, weaknesses, and core competencies through a resource-based view, value chain, and VRIO framework. The report then evaluates Vodafone's strategy using SAFe criteria. The analysis covers political, economic, social, technological, legal, and environmental factors, along with competitive forces such as the threat of new entrants, substitutes, and the bargaining power of suppliers and buyers. The internal analysis includes an examination of marketing, premium costs, brand strength, innovation, and limitations outside the core business. The report provides a comprehensive overview of Vodafone's strategic position and recommendations for improvement.

APPLIED
CORPORATE
STRATEGY

Table of Contents
INTRODUCTION......................................................................................................................3
Presenting the external analysis of the company...................................................................3
Presenting the internal analysis of the company....................................................................6
Describing the strategy evaluation of the company.............................................................10
REFERENCES.........................................................................................................................14

INTRODUCTION
Corporate strategy is that strategic plan of a firm which define the organization’s
overall goals and direction through which company meet these through management
activities. For the report, Vodafone as a telecommunication firm is chooses which has a brand
image at international level. The report will analyze the external environment of the company
and then determine the internal environment of the firm. Further using SAFe criteria, the
strategy is also evaluated.
Presenting the external analysis of the company
To determine the external environment of the company, Pestle analysis is used, while
on the other side to analyze the industry attractiveness, Porter five force is used which are as
mention below:
Figure 1: Pestle Analysis
Political factor:
 Brexit (Threat): This factor creates adverse impact upon the success of the company
because when UK is separated from US, it affect the overall industry in negative
manner. Such that it increase the tax rate of the business and it affect the business
overall financial profitability (Perera, 2017). Also, company has to establish the
infrastructure to support the network has to take permission and as a result,
government did not provide permission which affect the business operations.

Economic Factor:
 High rate of unemployment (opportunity):Telecommunication sector creates direct
impact upon the economy of the country such that economic activity in a specific
country and a level employment affect the purchasing power of people. Such that, it
provide the opportunities to people to show their talent and settle down in this
industry in order to get better benefits.
Social Factor: Changes in the perception of people (Threat and opportunity): It is analyzed that with
the change of world, perception of people also changes and this changing social trend
and lifestyle affect the business in negative manner. On the other side, with the
development of the technology and advance tools, company update its services and
make changes that help to attract customers (Achinas and et.al.,2019). For example,
growth in demand for internet based services has also provided benefits for
International telecom brands I,e, Vodafone.
Technological factor:
 New technique and tools (Opportunity): It plays a crucial role in the success of the
company and its business operations such that it has grown range of services and that
is why, it uses digital technology in order to provide higher convenience to their users
and also grow the customer engagement. Further, it also launch Vodafone App in
order to access the range of services that a firm is offers and help to meet the define
aim and objectives as well. Thus, it is consider as an opportunity for the company to
increase the financial position and accomplish define aim.
Legal factor:
 Changes in laws (threat):Legal factor also consider one of the most important factor
for the business such that growing legal factors make the growth difficult for
international business. Such that changes in tax rate, labor and business trade which
also affect the business operations (Rastogi and Trivedi, 2016). That is why, due to
non- compliance of these rules affect the overall business in negative manner, but
Vodafone comply with all essential rules in order to convert the threat into an
opportunity.

Environment factor:
 Sustainability (Threat): environment and sustainability are consider the important
focus for business and that is why, Vodafone is also investing in reducing their carbon
footprints in order to make a business more sustainable. Even, government also make
strict rules in order to discourage irresponsible practices. To comply the same,
Vodafone robust its management system to minimize its environmental impact and
also improve the performance level as well (Walsh,Bhagavatheeswaran and Roma,
2019).
Porter five force model, is used to determine the competitive advantage and industry
attractiveness of the company. Thus, there are five forces used by company to determine the
industry, which are as mention below:
 Threat of New Entrant (low):Vodafone face low threat of new entrant and it is
because of barrier of entry. Such that company is wishing to enter in the market but it
has to pay huge amount for entrance such that licensing fees regulatory issue and
setting up cost etc. In the same way, due to rapidly change in technology is also make
the difficult for new entrant to cope (Porter five force analysis of Vodafone,2019). So,
Vodafone can cope with this by maintaining high level of efficiency of its services
and face low threat of new entrants.
 Threat of substitute (moderate):The industry and company faces moderate threat of
products and services because the landline and CDMA services are declining in fast
manner but on the other side, broadband services are highly common (Farhikhteh and
et.al., 2020). As the company has a high customer base but there are many substitute
which also affect the business operation of the company such that Skype, Google
Talk, Yahho Messenger, email etc. As the company offer range of this services to
their customers and that is why, it does not need to pass down the cost attributed to
consumer.
 Bargaining power of suppliers (high): As the company have high bargaining power
because of greater margin as compared to its competitors. It is consider a leader in the
telecommunication industry and also have a large market share which easily absorbs
price increment from suppliers. Hence, by maintaining low price from its suppliers
and continue to making profit, it has a high bargaining power of suppliers.

 Bargaining power of buyers (high):The power of buyer is high in telecommunication
sector such that strong competition and lack of differentiated product (Annarelli,
Battistella and Nonino, 2020). Thus, buying power actually reduces the cost prices in
an industry and this will help to make effective profit as compared to its competitor.
 Industry rivalry (extremely high):The Company faces high competition in the
telecommunication sector due to low call rate prices as compared to its rivals. On the
other side, it keep providing the innovative product and services to their customers
which also help to stay ahead in the competition and this leads to high rivalry (Kang
and Na, 2020). On the other side, other company who also deal in the same industry
are also provide the same facilities but due to high charges and low connectivity, they
did not beat Vodafone.
Overall, it can be stated that company have a strong image but faces strong competition
from the other rival firm as well.
Presenting the internal analysis of the company
Resource analysis: this assist to determine the overall strength and weakness of the company
and which in turn help to let company determine 4 strength and 1 weakness of the firm which
are as mention below:
 Marketing (Strength):This is consider as a strength for the company because it invest
huge amount in marketing of product and services. Such that recently the company
start using ZooZoo ads on Yahoo which promoted the services offered by the
company. On the other side, earlier company also uses Pug as a Vodafone marketing
strategy which is follows by range of customers at global level (Nandamuri, Rao and
Mishra, 2020). Thus, it shows that company uses strong marketing activities and
Vodafone comes out with brilliant campaigns at right time.
 Premium cost (Strength): Another strength of Vodafone such that other telecom
operators are penetrating the market, while Vodafone is differentiating its services
regularly. Therefore, due to marketing and strong communication channel, it stands in
the top among all company who operate in the telecommunication sector
(AhammadGlaister and Gomes, 2020). That is why, it is stated that by offering the
services at low prices, Vodafone is still float in margins whereas, other telecom
operators are struggling to maintain the positive margin as well. Thus, even after

Brexit, company is still focusing on its prices and that is why, offer the best premium
cost offers in order to attract customers.
 High brand (Strength):Having ahigh customer base and strong presence in market,
company sustain the high brand in market. Such that Vodafone is ranked as 395th
among the world top 200 brands. It is also known for its wide distribution and
network cover and that is why, it is behind only China Mobile by occupying the
position of second highest ranked telecom operator (Adam, Alhassan and Afriyie,
2020). This shows that company has a high brand image at international level. It also
have its global presence in 30 countries and the partner presence in more than 40
countries.
 Innovation (Strength): Recently the company is heavily focus on the technological
innovation which is also consider the biggest brand for the company. That is why,
apart from spending to strengthen its core services, the brand is also investing in
emerging technologies in order to grow its customer
 Limited success outside core business (weakness): It is analyzed that company has
failed to make its product and services portfolio as a success. Such that apart from the
core mobile service business, Airtel and DTH which are also provide its services to
customers with an aim of company growth. But in the case of Vodafone, company did
not relies heavily on its core business for the growth and revenue generation (Daniels,
2020). That is why, it is consider as a weakness for the company.
Secondary
Activity

Firm
Infrastructure
Quality management
Legal matter
Accounting
Strategic management
HRM Providing training
Employment scheme
Diverse workforce
Technology
development
Technological and digital innovations
Automation software
Product design research
Data Analysis
Procurement Raw material
supplies
machinery
Primary activity Inbound
Logistic
Operations Outbound
logistic
Marketing Service
Retrieves
raw
material
Storing
the input
Providing
network
assembling
and testing
maintenance of
network
Perishable
Delivery
material
handling
Order
processing
Sales force
Advertising
Promotional
activities
Pricing
Channel
selection
Customer
Service
After
sales
service

Competence Value Rarity Inimitability Organisational
Support
Core
Competence
Network Yes No Yes Yes
Customer
service YES NO NO YES
Different
Product Offers YES YES NO YES
Resources
YES NO NO YES
Distribution
system YES YES NO YES
In the rapidly changing environment, it is indentified that it is very important for all
the business to have a competitive advantage in the market, especially for the business like
Vodafone as there is good amount of the competition to be dealt by the different organization
in the market. To overcome the variety of the issue related to the same in the market they use
to implement the competitive strategy to overcome the same in the market. Vodafone has
implemented the variety of the efforts to reduce the amount of the cost of production in the
organization with the help of adopting the variety of different type of new technological
resources in the organization, this has eventually help the company in providing good sort of
the product offer to the consumer in the market, this eventually used to help the company in
getting the competitive advantage in the market. Recent product which is offered by the
company was that they have double up the data limit of some good customer for a period
time. Also in the year 2016 Vodafone has reduced the price of different product of the
company to attract the customer toward the product of the company. Looking at this
competency it has been find out that help the company in increasing the customer base of the
company but do not used to add any sort of the value for the business in the long run, as it has

been find out that it used to lower down the profit of the company in the long run, also this
competency do not help the company in maintaining good sort of the sustainability of the
business in the long run.
Resources of the company are also not that valuable
competency for the business. As it has been identified that organization is having good sort of
resources but this sort of the resources are also contain by the big competitor in the market, so
it can be said that this is one of the competency of the business. Another competency of the
business is the Delivery system of the company, as it has been identified that there is good
delivery channel of the business in the market, as Vodafone has good number of the store
throughout the UK, this eventually used to help the company in maintaining good delivery
system of the company. It has been identified that in the starting of the 2020 there were 400
stores which was located across the UK, and also company is looking to develop the same in
the organization as they are planning to open another 50 stores by the end of 2020.
SWOT Analysis
STRENGTH WEAKNESS
Marketing’
Premium Cost
High Brand
Innovation
Different product offer
Limited success out of the core
OPPOURTUNITY THREAT
New technique and tool
High rate of Unemployment
Brexit
Change in Law
Sustainability

Describing the strategy evaluation of the company
TWOS
STRENGTH WEAKNESS
 Marketing’
 Premium Cost
 High Brand
 Innovation
 Different product offer
 Limited success out of
the core
Opportunity  New technique and
tool
 High rate of
Unemployment
Threat  Brexit
 Change in Law
 Sustainability
These type of the strategy will generally applied by the Vodafone in the market with the sole
expectation that these will help them in getting good sort of the competitive advantage in the
market. Looking at the TWOS analysis it has been find out that some of the strength of the of
the company are marketing and premium cost and High brand of the company, at the same
time these will help the company in overcoming the threat like brexit and Sustainability as
with the good marketing and premium they will able to manage the same customer base of
the company in neighbouring country as well. At the same time weakness of company is
founded that Vodafone is having Limited success out of the core, at the same time there is
good opportunity in front of organization to adopt new technology in the organization to
overcome this weakness of the company in the long run.

LOW LEVEL OF INTEREST HIGH
L
O
W
P
O
W
E
R
H
I
G
H
 Government
 Regulator
 Community stakeholder
 Internal stakeholder (employees)
 Economic stakeholder (Customers)
 Developer
 Tesk developer
 Economic stakeholder (suppliers)
 Technological stakeholder
 Economic stakeholder (Shareholders)
 Social/Political stakeholder (Competition
and Markets Authority)
Stakeholder Matrix
High interest low power: Government and regulator in the nation are having high level of
interest in the operation of the business, as it is there responsibility that they used to make
sure that all the operation of the business are done in the way that it do not harm citizen of the
country but at the same time they have not power to carry out different operation of the
business. For maintaining the same they used to make different policy in the organization.
Interest high, Power high: They are the one who has optimum level of interest as well as
power to influence the strategy in an organization. As they are the one who has some sort of
the interest link with the performance as some has the monitory interest and some has the
reputation linked with the same in the market.

Interest low, power low: They are the one in the organization who do not has that sort of the
interest in the project they generally used to carry out different operation in the sack of
different order which has been passed on the different senior authority in the organization.
Interest low, power high: They are the one in the organization who used to influence the
outcome of the project very adversely in the market, as it has been identified that they
generally used to provide the variety of the support to carry out different operation to get the
competitor advantage in the market but at the same time they do not has that sort of the
interest in the success of the strategy, they only used to has monitory interest.
Feasibility: After going through the above strategy that there are many different type of
resources which will be require in the organization to carry out strategy. Human resource will
be the one in the organization as Vodafone has to make sure that they used to maintain good
sort of the Human resource in the organization to carry out different operation related to the
strategy in the organization. Also, it will require good amount of monitory resources for the
company to carry out different strategy efficiency in an organization.

REFERENCES
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Online
Porter five force analysis of Vodafone. 2019. [Online]. Available through:
<https://writepass.com/journal/2012/09/vodafone-group-plc-swot-analysis-and-porters-five-
forces/>.