Business plans of companies depict the ways in which businesses progress. They incorporate vision, mission, goals and strategic initiatives undertaken by the company. In the current comparison of Telstra and Qantas business plans, there have been found to be various aspects in which they differ from one another with certain similarities as well.
Telstra is a telecommunication company in Australia which provides various products such as mobile phones, internet, accessories, and broadband facilities and so on (Johnson, 2011). The Company occupies almost 50% market share in Australia with its varied products and services. Qantas, on the other hand, is an airline in Australia. The airline has a large number of fleets that caters around various destinations around the world.
Company objectives, vision, and mission are integral to cater to long-term strategic goals of the company. The corporate mission for Telstra is to become the leading brand in telecommunication in Australia. Mission Statement for Qantas is to become the leading aircraft carrier in Australia covering maximum possible destinations (Thornton, 2008). Analysing mission statement for both companies leads us to understand that both the companies want to cover extensive areas of Australia.
The corporate vision for Telstra is providing the best possible connectivity and broadband services, providing excellent customer service, catering to quality broadband wires such that the best possible connectivity can be reached. Corporate visions of Qantas is catering to all possible destinations connecting to Australia, ensuring safety to passengers availing services of the aircraft and providing excellent customer services (Lindgardt et al., 2009). Meaning that both the companies’ visions are aimed towards excelling in their services. Hence the vision and mission statement is similar in nature, the companies being in service sector their objectives will be similar too. Objectives for the companies will be to cater to their individual vision and mission such that they can easily achieve their corporate goals. The objectives are similar and they can be compared to for attaining customer satisfaction and excelling in their services.
The business plans for both the companies are extremely well formatted. Analysis of both the business plans reveals that they are well structured and have integral or key points which need to be present. Strengths of both the plans include the presence of appropriate financial analysis, strategic plans, vision, mission, and goals. There is appropriate planning for the future step of action also present.
The business plans for both the companies have certain weaknesses as well. The major weakness of the business plans is that they are highly technical in nature. The business plans have been written on purely technical terms and aspects which make it rather difficult to read easily. Any layman cannot read through the business plan easily due to the presence of a large number of technical terms. It requires proper and comprehensive knowledge of management and finance to be able to read the business plans.
Secondly, the business plans were cumbersome in size meaning that it required quite some time to read through and decipher the entire business plan. Due to the length of the business plan, it is difficult to read through it fast and then make recommendations or analysis related to the same.
Analysis of competitive environment for both the companies reveals that Qantas and Telstra operate in the tremendously competitive business environment. The competitive environment for Telstra reveals that there is the presence of a large number of buyer’s threat with limited supplier threat. The Company has been able to establish a good rapport with its current suppliers (Evans, 2010). The threat from new entrant or substitute product is low as the company has already established itself in the competitive market. The below comparison of open network operators in Australia reveals the benefits Telstra offers compared to others.
Due to the multiple offerings made by Telstra, it receives continuous and positive customer influx throughout the year and quarters. As depicted in the figure below, Telstra customer growth. The Company aims at providing maximum possible benefits to its customer for the lowest possible rates. Moreover, dynamic customer service provided by the Company allows the company to attract maximum possible customers.
The competitive offering of product, price, promotional strategies and product offering by Telstra has led to its high growth of market penetration in rural as well as in urban areas. The 4Ps offering by the company is strategically aligned to attaining market leadership in the industry (Li, 2012). This is reflected in its customer attainment growth ratios and market penetration as reflected below.
Qantas occupies a leadership position in the Australian market across international as well as in domestic sectors. Analysis of its industry rivalry reveals Virgin airways being it’s the only rival. There is relatively less bargaining power of buyers in the international sector; however, there is a considerable threat in the domestic sector. Bargaining power of suppliers is relatively less and the threat from new entrant and substitution power is low. The airways are able to occupy competitive position due to its on-time service and capability to competitively cater to 4Ps. The product of the company is well positioned against its prices. Moreover, the company has a competitive distribution strategy for its tickets with stable promotions conducted.
Both the companies are able to occupy a market leadership position with high levels of competitiveness by extending their core competence. The companies are extremely innovative and continually focus on designing new products or strategies for promotion for its customers.
Strategic orientation for both the companies is focused on extensive marketing promotions. The strategic position occupied by Telstra is cost competitiveness, which is also adopted by Qantas. Both the companies have positioned themselves as market leaders have rendered them the capability to adopt cost competitiveness. Cost competitive strategy has been adopted by the companies to be able to penetrate the market.
According to the above-mentioned cost leadership strategy, it can be seen that it is a broad-based competitive strategy (Nair et al., 2011). This has allowed both the companies to penetrate in the rural market for Telstra and the domestic market for Qantas.
Companies, in order to operate within the corporate environment, make extensive use of resources such as human, technological, financial and other physical resources. Qantas has a large number of fleets with ground staff, pilots, crews and other staffs. The company’s financial resources comprise of equity, debt and loan capital. Telstra’s core competency comprises its varied resources such as human resources (Morsillo, 2011). Technical expertise and skills such as innovative capabilities allowed the Company to become a leader in the market (Beltrán, 2013). The Company has huge financial resource capital comprising of equity, debt and cash resources.
A company’s performance can be best understood by its capability to achieve financial outcomes. Every company tries to attain the maximum possible financial output such that it can satisfy its shareholders and meet the interests of its varied stakeholder group within the Company. The current scope of businesses such as Telstra, performance benchmark used by the Company consists of EPS, Revenue, Net Profitability and various other measures to understand its performance (Wensveen & Leick, 2009).
Revenue of the Company stood at AUD$26 billion, operating income at AUD$6.2 billion, net income at AUD$3.9 billion as of 2017 financial year period. Total assets of the Company as of 2017 stood at AUD$42.1 billion with total equity assets AUD$14.6 billion. The Company had operating subsidiary of 150. When benchmarking or comparing the Company’s performance against its peers it could be understood that the Company is performing well compared to its peers.
Qantas’ financial performance depicts that company’s profitability is increasing. The below figure depicts the financial performance of Qantas by comparing Financial Year 2015 against 2016, which is depicted to rise.
The Company’s revenue as of 2017 stood at AUD$16.1 billion, operating income AUD$1.59billion, total assets at AUD$17.2 billion with equity to be at AUD$3.54billion. Performance comparison can also be conducted by comparing the share price performance of the company, which can reveal its demand in the market.
Conclusion
Analysis of both the business plans reveals that both the businesses are market leaders in their domain. They have tremendous amounts of core competency, which have allowed them to become market leaders and establish a position in the competitive market. Moreover, both the businesses are continuously dynamically striving to position themselves in the market through innovations, which is the reason the companies have sustained competitive pressures.
References Lists
Beltrán, F., 2013. Effectiveness and efficiency in the build-up of high-speed broadband platforms in Australia and New Zealand.
Evans, D., 2010. Social media marketing: the next generation of business engagement. John Wiley & Sons.
Johnson, C., 2011. The politics of broadband: Labor and new information technology from Hawke to Gillard. Australian Journal of Political Science, 46(1), pp.3-18.
Li, G., 2012. The return of public investment in telecommunications: Assessing the early challenges of the national broadband network policy in Australia. Computer Law & Security Review, 28(2), pp.220-230.
Lindgardt, Z., Reeves, M., Stalk, G., and Deimler, M.S., 2009. Business model innovation. When the Game Gets Tough, Change the Game, The Boston Consulting Group, Boston, MA.
Morsillo, R., 2011. One down, two to go: public policy in service of an available, affordable and accessible National Broadband Network for people with disability. Telecommunications Journal of Australia, 61(2).
Nair, S.K.S., Palacios Fernández, M. and Ruiz López, F., 2011. The analysis of airline business models in the development of possible future business options. World Journal of Management, 3(1), pp.48-59.
Thornton, G., 2008. An innovative, flexible and workable business continuity plan: a Case study of the Australian Customs Service Cargo BCP. Journal of Business Continuity & Emergency Planning, 3(1), pp.47-54.
Wensveen, J.G. and Leick, R., 2009. The long-haul low-cost carrier: A unique business model. Journal of Air Transport Management, 15(3), pp.127-133.
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