Telstra Corporation Ltd. has its operation in telecommunication networks and deals in internet, mobile phones, television, etc. It is Australia’s biggest telecommunication company. It is now has become completely private as going through more developments to become more focused on customer with the guidance of prior Chief Executive Officer named, David Thodey. The company has been operations since ages and have been delivering quality performances to the client.
There have been a lot of analysis already done on the overall feasible status of the company and how they have been working to provide the best results. We are here to discuss about the economic/ financial, social and environmental performance of Telstra Corporation Ltd. The annual report of the company has been downloaded and important analysis have been done (Telstra, 2016). Important points based on the environmental, financial and social status of the company has been stated and also it has been recommended on the approach of the investors of the company their in. We shall analyse both the annual (financial) as well as sustainable reports to understand whether to invest in the company’s share or not.
Analysis:
To improve the customer advocacy, is the utmost priority and primary objective of Telstra. With the provision of great services to customers, Telstra means that it shall change the perspective about the customer thinks of us. They in turn will act like advocates and shall refer us to others as well. Likewise the market shall prosper in the economy. The following initiatives are taken for customer advocacy:
So, we can say based on overall analysis of the strategies of the company that they aim to improve the current status of the technology based cellular services that are offered and to provide more refined services that would provide faster communication for this they have developed the above plans and strategy that would help them in achieving this in the lesser time possible and would lead to long term growth and development on part of the customers by providing them with class services (Bromwich & Scapens, 2016). Thus, we can say that these strategies are developed keeping in view long term gains and long-term development and not short term development. The company has also taken help from experts who can help them in this regard, and help them in framing strategies for the company.
This deals with the overall financials of the company based on their financial statements of the company, on the overall net profit and taxes related to the company. The financial performance of the company is very important, the investors depends upon this to decide whether they want to invest in the company or not and the overall gains they are going to make from it.
In this analysis the annual report of the company has been downloaded and the overall financials have been studied to judge how much profit the company is making, how much growth have they achieved since previous years and what are the areas in which they need to put more effort so that in future the overall return for the company is high. This is how this system works and it leads to provide better insights into the overall financial position of the company with respect to its financial data (Belton, 2017).
The capital management strategy holds a clear focus for maximising the profitability of shareholders, to maintain the finance strength, and to hold financial flexibility. It notifies that it would return up to around $1.5 billion capital to stakeholders, forgoing a $1.2 billion of the share in market for buy back and $250 million on-market share buy-back. The buy-backs are supposed to be financed from the excess cash of Telstra accumulated profits.
The performance of financial in the year 2016 are:
We have provided here a snapshot of the company’s financial position as of FY16. We also have a comparability of the current year report with the prior year report summary of the same company. With it, we shall have a specific picture of the data and information related to each income and expenditure statements, the assets and liabilities of the company. Furthermore, we can also see as to how it has an impact on the Earnings per share of the company with regards to the current year in comparison with the prior year. We can see that the value of Current year EPS is higher than the prior year. This shows that it is revenue generating company and investment decision in Telstra shall hold good. However, along with the financial position and performance, we shall also consider the major parameters of social as well as environmental performance of the company as well (Dichev, 2017).
Based on the overall financial analysis it can be said that since previous years the company has shown great amount of growth and that is visible from the overall financials of the company when we compare it with the previous year financials of the company (Farmer, 2018). On the sustainability front also, the company has taken effective steps and that is evident from the overall reduction in the greenhouse gases of the company, it is also evident from the reduction of carbon emission, thus we see that the company is trying to perform as per the energy standards that have been set as palpable and correct by authorities. This has effect on the financials of the company. The overall share prices of the company have improved and thus investors have
A great deal based on which they can invest in the financials of the company and that can earn them huge returns.
Environment Strategy:
The environment strategy lays down the solution for how to address all the issues related to environment and its opportunities. This strategy aims to enhance the performance of environment for the operations and the shareholders to the whole value chain. The Telstra’s strategy has 3 focus. These are:
Evaluating the quantity and educating how the services and products can make the customers to reduce the effect on environment, specially the energy consumption, and carbon emissions. This will help in understanding what are the main reasons because of which emissions are happening in the environment and how they can reduce it. It is important to find the source and then only efforts can be taken which can help the management of the company, and then customers can be educated to reduce energy emission from those sources as those would help them in getting a sustainable environment (Farmer, 2018).
Staying super active in locating and lowering the huge environmental impacts and the costs related to operation of the businesses. This will help in putting the framed strategies to operations and that would be helpful in the long run, as that would help in reducing cost and generating operational results. For this proper budgeting needs to be done, experts need to be hired who have good knowledge about this matter and then applying them so that all of these operations can begin for long term results (Goldmann, 2016).
Joining hands with suppliers and making them to lessen the major impact affecting the society and environment, with the products and services provided by them to the Telstra. This is a very important step this will help the company in getting help from suppliers who can help them in creating such products and taking such steps that would help them in reducing the overall emission of gases and providing quality products to the customers (Telstra, 2016). This supply management is a very important task, developing a connection with the suppliers and getting them to deliver what the management really requires is important for the long-term success of the company and will help to reach to their goals in the best ways possible. Experts can be appointed who can help the management in managing these supply chains and regulate them effectively.
Environmental Customer Value Proposition:
To embed into the designing and development of current products and services all of the environment consciousness. It is important that all products that are build should match up to the environmental standards and should be in that limit as set by the environmental authorities and it should not lead to too much emission of gases and other harmful gases in the environment.
It relates to communicating the advantages to environment with the goods and services that is being sold. The customers should know what they are using and how much harm can it cause to the environment to which it is being served and how they should use it so that in future it will lead to sustainable use and protect the environment from all kind of harms. Awareness should be spread so that the customers are aware about the steps that the company is taking to protect the environment from all kind of harms.
It helps in introducing new products and services that leads to the advantage of environment. The company needs to make use of technology to see how they can reduce the harmful effect on the environment, develop new strategies that would help them in the long run to protect the environment. For this the company needs to do a lot of research and innovation and make use of the resources that they have to deliver the customers the best products which is both environment friendly and as per the needs of the people who are using it (Kuhn & Morris, 2016).
The research has been completed that was due to be introduced in the end of 2016 that determines all the chances that could be obtained from the cloud services. The name of the report being “Connecting with the cloud, a low-carbon future is ahead” that shall enhance the financial and environmental advantages to Telstra’s Australian paved and sharing of the services of cloud. It is one of the biggest steps that has been taken by the company based on its CSR policies and helps them in long run to get the best environment friendly results for future growth and development. Cloud is thus one of the most greatest innovations for the company.
Use of Energy and its efficiency:
To lessen by providing more chances and education of reusing, reutilizing, and recycling and to ensure that the appropriate practices of disposal is considered. E-waste is one of the highest rising waste elements that has been increasing since the recent times, as there has been overall increase in the use of technology, fuels and other such elements that has led to increase in the waste and is harming the environment in which the company is operating (Kangarluie & Aalizadeh, 2017).
To ensure that there is reduction of emission of energy and finding of more opportunities for the renewal sources of energy. Energy is a very rare resource hence effort must be taken to protect it so that in future enough of it is left for the people to use. Thus, for that reason renewal of the energy based resources are required as they would suffice the needs of the future generation.
To enhance the efficiency of energy of the data centres, workplace, ICT Equipment, the architect of networks, the buildings of network, etc. energy can be used for a variety of purpose, but given that it is a rare resource, people should take efforts to make sure that they are using it efficiently and there is no loophole and wastage in that. The less there will be wastage the better it would be for future.
The Green House Emission rate has dropped by 56% from the bassline year i.e. 2014, which reflects that the target has been achieved one year before than it was estimated. Thus, if the company keep working in this zone, they would be able to reduce the overall emission of the gases to a large extent and that would ensure that their overall CSR goals have been met and the management of the company can also take efforts so that in future the overall reduction is more.Use of Resource, waste and e-waste:
The ICT gives away a broad range of social, economic and environmental benefits. A digitalised era provides more opportunities to stay, work, operate more effectively and interacting with people. As and when with the gradual increment in e-waste, we are being responsible to go through our value chain to derive more chances and plans so that we can introduce a more sustainable manner to maintain our resources, wastage and e-waste (Sithole, et al., 2017).
With the past 3 years, the entire wastage has been reduced by 23% that was consistent in 2016 as well. Yet, the waste enhanced to 6% and the recycling rate resulted in decrement by 19%. Also there is constant effort to improve the waste management and also to focus properly on recycling the waste (Heminway, 2017).
With regards to Telstra, the consumption of water has decreased by 3%, this is since a program was help for detecting leakage of water at the operating sites, and also to respond and make correct the located leakages.
There has been considerable decrease in the use of paper by 26%, due to reducing the commercial printing and billing paper. It is being encouraged to use the paper in the operations, which is inclusive of printed marketing material that is being complete by professional printers. Also due to the shift towards the digitalisation, there has been decrement in commercial printing by 47% with respect to the last year (Telstra, 2016).
Since we know that there is gradual evolvement of Technology, we understand that the expectation of consumer is changing. In order to make sure, that it is possible to cope up with this situation, several measures have been adopted to attract employees and retain them, so that it is possible to make Telstra a world class technology company. Not only these, but there are a lot of investment made for attraction and retention of employees by conducting various programs, in order to make the employees efficient, effective, skilful, passionate in their work to help Telstra to become a world class company in terms of technology. This is done as follows:
The score of employee engagement is 71% with the response rate of 80%. The primary focus has been to improve customer satisfaction, improving the personnel advocacy, and also enabling the people to derive excellent experience by minimising the difficulties and issues. The target was to reach the standard rate of 84%. Always seeking and working upon feedbacks from employees assists Telstra a great place to work.
Since the market is very intense, it will become more complex to retain the experienced employee. In order to attract and restore these employees, this year a new survey has been launched that helps to recruit only the experienced employees who are trained at customer advocacy and have a mentality to handle the customers. Conducting several workshops of employees with the leaders, also is a way to encourage the employees.
The management of performance is done by mutual discussion of employees with the leaders. Here they discuss the noticed best practices feedbacks from the personnel. This year, a new initiative has been taken to enable the employees to have a constant conversation with the leaders, regarding their observations, approach, priorities, and progress that might help the company to achieve its key priorities. The initiative is relatively flexible so as to change itself as per the needs and desire of the employees. It is important to put efforts for the development of the employees as these are the people on whom the growth and development of the company is based. The overall social performance deals with how good the company is with its peers and how much steps they are taking in that regard for the company.
Conclusion and Reccomendation:
We therefore can conclude that even if the telecommunication industry has deregulated in 1990, yet Telstra has somehow made it possible to remain the biggest producer of telecommunication services in Australia. We can see that 72% of Australia’s small and medium businesses (SMBs) are the consumers of Telstra. These are making the utmost utilisation of the products and services to the customer and to do business. Telstra is adjoining the innovation technology, the capacity and the talent all around the world, in order to provide great satisfaction for the customers.
This is the only company, maintaining and setting up the target of customer advocacy at peak, thereby adopting more measures for customer satisfaction. The company has done commendable job since years to maintain a sustainable level of use of resources and to put them to best use that can help them in the future and has uplifted the overall CSR policies that companies should follow. On the basis it can be recommended that people should invest in the company, as they have been taking deliberate steps in keeping up with the CSR policies, they have taken steps to ensure that the company is working towards growth and expansion. The company has also taken steps to ensure that their financial performance improves from the previous years and this is clearly reflected from their high financial performance. Overall it would be recommended to invest in the shares of the company to get good returns.
References
Alexander, F., 2016. The Changing Face of Accountability. The Journal of Higher Education, 71(4), pp. 411-431.
Belton, P., 2017. Competitive Strategy: Creating and Sustaining Superior Performance. London: Macat International ltd.
Bromwich, M. & Scapens, R., 2016. Management Accounting Research: 25 years on. Management Accounting Research, Volume 31, pp. 1-9.
Das, P., 2017. Financing Pattern and Utilization of Fixed Assets – A Study. Asian Journal of Social Science Studies, 2(2), pp. 10-17.
Dichev, I., 2017. On the conceptual foundations of financial reporting. Accounting and Business Research, 47(6), pp. 617-632.
Farmer, Y., 2018. Ethical Decision Making and Reputation Management in Public Relations. Journal of Media Ethics, pp. 1-12.
Goldmann, K., 2016. Financial Liquidity and Profitability Management in Practice of Polish Business. Financial Environment and Business Development, Volume 4, pp. 103-112.
Heminway, J., 2017. Shareholder Wealth Maximization as a Function of Statutes, Decisional Law, and Organic Documents. SSRN, pp. 1-35.
Kangarluie, S. & Aalizadeh, A., 2017. ‘The expectation gap in auditing. Accounting, 3(1), pp. 19-22.
Kuhn, J. & Morris, B., 2016. IT internal control weaknesses and the market value of firms. Journal of Enterprise Information Management, 30(6).
Sithole, S., Chandler, P., Abeysekera, I. & Paas, F., 2017. Benefits of guided self-management of attention on learning accounting. Journal of Educational Psychology, 109(2), p. 220.
Telstra, 2016. FY16-Annual-Report. Telstra.
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