Business Strategy of Vodafone UK
Introduction
In the current situation of telecommunications, more and more people are subscribers of mobile telephone services. The mobile phones are also called as handsets come in innovative features, pocket-sized, and in affordable costs. For over the years, the manufacturers are continuously developing the mobile phones in which the people described as effective way of communication. And today, different brand of mobile phone are emerging and competing in the field of wireless communication with innovative services.
Background of the Study and Problem Statement
The British Telecommunications already dominated the wireless service market. The service provider, Vodafone as one of the leading company of mobile services, enabled to penetrate in the market and enjoying the success (2001). The success that the company gained is not possible without the aid of the strategies. Therefore, the main focus of the research study is concern on the business strategy of the Vodafone in the UK.
Research Objectives
The research identified three main objectives that were expected to be achieved at the end of the study. First is to identify the business strategies of the Vodafone Company in the international market. The second objective is related to the first which regards on the application of the identified business strategies in the telecommunications industry. And the third is to serve as a valuable context in the literature of communications.
Research Questions
The study provided certain question in the aim of achieving the adequate answers. The questions presents’ the valuable pieces of information in creating a successful business and sustaining its growth.
1. What are the common challenges or constraints that are available in the telecommunications industry?
2. What are the strategies applied by the Vodafone to prevent or lessen the impact of those challenges?
3. What is the current situation of the Vodafone after the realization of the challenges?
Literature Review
The telecommunications industry is usually composed of technological advances, including the development of the alternative infrastructures and new services and created a dramatic impact in the economy (2003). The competition in the industry of telecommunication gains the advantage in the scale and scope in the market entry (2001). The rapid growth of the competition is unpredictable due to the continuous development of the technologies and changes (2003). The business activity in the telecommunications industry is also plagued by different uncertainties and too much uncertainty and lack of international coordination can decrease the confidence of business leaders and not beneficial in the atmosphere of the company ( 2002). Vodafone identifies the evolving challenges in the macro economic environment. Within that environment, there is a competitive pressure that continues to be strong and contribute to the price declines. Also, the consumers have an increasing choice of service providers because of the close competition and new entrants. In addition, the mobile services are also regulated that contributes to the lower mobile terminations rates and roaming prices. Through the expected challenges, Vodafone increased their approach on the value enhancement and cost reduction ().
Methodology
The methodology used by the study is based on the past records or case studies of Vodafone. Through this method, the researchers can examine the different strategies they applied in different situation. Also, the past case studies allow the researchers to provide conclusion on what are the best applied strategy that will be suitable to the business.
Analysis
Vodafone applied their creation of the business strategy that is composed of five essential parts. The company is very focus on the revenue stimulation and cost reduction in Europe. The company’s focus is applied in delivering the strong growth in emerging markets. The third part of their strategy is to continue their efforts in innovation and delivering the needs of the customers in terms of total communications. Vodafone also actively manage their portfolio to maximize the returns. And lastly, is to align the capital structure and shareholder returns policy to strategy.
Conclusion
Telecommunications and technology is continuously growing and inseparable. With that factor, all of the technological advancement will contribute and create an enormous impact in innovation and changes in communication. If the company will base their performance growth, they will surely recognize the impact of the technology which suggests that there is a need for transformation. Usually, the basic defense mechanisms of the businesses plays between the two factors, one is to assume the changes and the other is to ride in the current changes. And Vodafone strategically chose the first option. The company values the importance of being the first provider than being the second in the race where the competition is extremely high.
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