Environmental Analysis Of Telstra Using SWOT Analysis

Innovation at Telstra

Question:

Discuss about the Managing Innovations Of Telstra.

Telstra is the company that operates in the telecom industry that serves the market with different types of services such as mobile phones, internet services, and other information technology services (Telstra Exchange, 2017). Most of the homes and offices in Australia takes the services of calls, internet, mobile, broad band etc. from Telstra. It not only served the Australian market with the mobile and telephones services but also caters the nationwide market with the telecom communication services. The company is listed in fortune biggest 500 companies’ of the world. The vision statement of the company suggests that the company wants to convert the world and tries to provide best services to their customers. The company believes in having growth with long term profits by creating high value for the shareholders.  This report focuses on the environmental analysis of the company with the use of SWOT analysis technique and also provides the information about the future trends and strategies that are available for the company to be used in the next 10 years.

Analysis of treats and opportunities of the company results in providing the information about the trends of the industry that acts as the threat for the company and also develop the opportunities for the company to be explored.

• Saturation of the market: It is the biggest threats for the company. The market is very much saturated for the company because there are many other companies in this industry that are serving the Australian market such as Optus and Vodafone Australia. This results in division of market share amongst the different companies.
• It has been analysed that Telstra is the company that is on the top in the market share but the progress is not been seen (Gardiner, 2015). Other competitors like Optus and Vodafone are experiencing growth and may cover large market share in future because they are not so behind from Telstra.
• Technology: Rapid changes in the technology are another threat for the company. In the telecom industry, most of the companies come up with the new technological changes and innovation in their services because people always want new products and services by telecom industry. Thus, it is required by Telstra to come up with any of the innovation in the market to serve the customers. Innovation plays a very important role in telecom industry and thus requires Telstra to build up innovation and to be updated technologically (Fan, 2011).

• Going global into international market: It is the first and the fore most opportunity that is available for Telstra. This is because Telstra is performing well in Australia, now it is the time to move into international market such as Asia and China. China is the place where internet penetration is very low but the users of different market at the place are high thus it is required by Telstra to enter such place with its businesses that it can do the needful. Not only in China but the use of high speed internet is increasing in all over Asia (Ferrers, 2015).
• Entering different business: Most of the companies are entering into different businesses, so as to be safe. As the telecom industry is very such linked with the legal and government regulation thus the market is very much fluctuated. Entering into the new industry or any related business such as into technological hardware will helps the company to grow and also helps in enhancing the brand image (Harris, 2012).

In terms of innovation, it has been analysed that the company is focusing on the threats and the opportunities available in order to make some of the innovations. It has been analysed that the company is into 5G plans that will be implemented in near future. It is the technological innovation by which Telstra can serve the customers. The company has an innovation lab that is made for making innovations. Other than 5G, the company is also focusing on products like drones, augmented and virtual reality and Internet of Things (Khatamianfar, Khalid, Savkin and Agelidis, 2013). The company is considered as an innovative firm as it is investing a lot in making innovations. The company has launched the first voice over LTE in the market. There are lot more opportunities with the company such as entering to the new industry (Berkhout and Van Der Duin, 2007). Making innovation is the competitive advantage that the company has if the company enter the new market or the business with some of the innovation then it will definitely help the many to capture large market.

Competitors of Telstra

Strengths:

• Market position: The major strength of the company is its market position. In terms of market share and position, the company is on the top in Australian market. There are range services that the company serve to the market such as landline, mobile calls, networks, data connection etc. the company is also leader in terms of network connection (Aidi, 2012).
• Range of network: 98% of Australian is under the network circle of this company. This suggests that most of the Australia prefers to buy this network for availing the services. The company has the aim to cover 99% of the Australian population under their network circle. High investment in the innovation and future technologies is also strength of the company (Yüksel and Dagdeviren, 2007).
• Innovative services: The company has served the market with first Voice over LTE services. The future technology that the company is focusing on is narrowband Internet of Things technology. Entering the new market ad business is another key strength of the company. The company is preparing to enter the new market of Asia from new businesses.

Weaknesses:

• High price and lack of customer service efficiency: As far as the weaknesses of the company is considered, it has been analysed that the company lacks in efficiency of the customers service operations. High price is again a big weakness of the company. Most of the people do not take the services from Telstra because of its high prices than the competitors (Cortimiglia, Renga and Ghezzi, 2011).
• Not going global: The company is not focusing on growing by taking the business of the international market while the biggest competitor Vodafone is overcoming the customers of many countries. It is the need for the company to expand its business to different market so that it can enhance its customer’s base as well as the market share. In today’s dynamic environment, it is required by the companies to be active. This is because the needs of the people are changing (Yang, Lee and Kurnia, 2008). Most of the people prefer to keep the prepaid services especially in case of the individual customers thus; the company like Telstra is not focusing on the individual customers and focus more on the market that is availing the services of post-paid plans. It is required by the company to have individual customers by releasing offers in prepaid (Goggin, 2010). This is because the customers are not loyal these days. They prefer to change the network according to the offers and the discounts they get.

As per the land mass, it has been analysed that Telstra is the company that is covering almost 2.4 million Sq. kilometre of the Australian total land mass by its network. As far as the competitors of the company such as Vodafone and Optus are concerned, they are covering around less than a million and 1 million sq. kilometre of the total land mass respectively (Gubbi, Buyya, Marusic and Palaniswami, 2013). This suggests that Telstra is way ahead of its competitors in terms of network coverage. As far as the innovation is concerned, it has been analysed that both the competitor companies are innovating their products and services to compete with Telstra.

As far as Vodafone is concerned, it is the company that deals with innovation as per the requirements. The company claims that most of the Australian uses their 4G services for their homes and business purposes (Pande and Padwalkar, 2014). Vodafone is cindered as the global leader in terms of Internet of Things technology that supports the company to empower and releases the some of the most innovative products. Vodafone has released the connectingDrive products that are installed in the BMW series5. This is the product that allows the customers to listen to the favourite music along with the facility of emergency calls. Vodafone IoT technology is used by much business as the company provides much solution by this technology to other business.

Optus is another big competitor for Telstra in Australia. Optus is considered as weakest among all the three companies (Macaulay, 2016). Optus has not cages since years. It has been analysed that Optus need to make some changes in their processes to achieve the target in the market and to compete with Vodafone and Telstra. Even the company is very strong in terms of mobile market but it fails in challenging Telstra since years. At the time of vodafail in Australia also the company failed to attain the market share (B&T., 2017). The surprise move of Optus was to enter the football league. This has helped the company to achieve some of the market position.

Telstra is competing with these organizations by implementing Telstra innovation hub and IoT technology in their business.

Strength: ·         Market position ·         Brand image ·         Network coverage	Weakness: ·         Customers service ·         High price
Opportunities: ·         Global market ·         entering new business	Threats: ·         Market saturation ·         Change in technology

As per the above SWOT matrix of the company called Telstra, it has been analysed that the company has major strengths that are required by any of the telecom company to be in the market and to compete with the competitors. Telstra is using its strength in a very effective manner and this is the reason why the company is on the top of the telecom market in Australia. It has been analysed that the company has to strategies its activities and make the use of its target to explore the opportunities available (Carruthers, 2014). As the company has strong market position so the company can easily enter the new market which is the major opportunity that is in front of the company today. As far as the competitors are considered, Vodafone is doing great at international level. Thus it is also important for the company like Telstra to make use of its strength and explore the opportunities present in the market for the company. One more opportunity is also available for the company in the market that deals with entering into the new business. The company can again use its strengths to avail this opportunity. As the company has good brand image and the network coverage the company can easily enter the new business as it does not need to create awareness of the brand but only need to make awareness about the products or the serves it is releasing (Drucker, 2014). After assessing the strength and the opportunities, the company’s weakness suggests that it is very high priced. This somehow affects the company’s customer base. This is because people prefer to buy the network that is cheap especially in case of prepaid services. Threat for the company is market saturation. The market or telecom industry is so much saturated that there is no scope of making new customers. The company have to target the already existing users who are using different networks. This is because there are no people left the country or in the world who are not using the network services from one or the other companies (Teece, 2010). Technology is another threat for the company. In this dynamic environment, it is very difficult for the telecom companies like Telstra to come up with all the new technologies as and when they come into market. In the next 10 years, the many would be directing towards reducing its price by making reduction in their cost of the process. Reduction in the cost helps in reducing the ultimate prices for the customers. Also, the company would be involving its process and making investments in innovation so as to compete with the innovation made by Vodafone. In terms of innovation, it has been analysed that the company is focusing on the threats and the opportunities available in order to make some of the innovations. It has been analysed that the company is into 5G plans that will be implemented in near future. It is the technological innovation by which Telstra can serve the customers. The company has an innovation lab that is made for making innovations (Chesbrough, 2010).

SWOT Analysis of Telstra

Conclusion:

Telstra is the company that operates in the telecom industry that serves the market with different types of services such as mobile phones, internet services, and other information technology services. The major strengths of the company are its market positioned its brand image while the weakness of the company is its high price and bas customer’s service. As far as opportunities are concerned, the company has to enter the new business and the global market while the threats for the company are market saturation. The company is very innovative in nature because the company has launched the first voice over LTE in the market. In future, the company have to target the already existing users who are using different networks. This is because there are no people left the country or in the world who are not using the network services from one or the other companies. Technology is another threat for the company. In the next 10 years, the many would be directing towards reducing its price by making reduction in their cost of the process along with entering the new business and market at global level.

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