Macro-environmental Analysis

Strategic management is considered to be a process which is based on continuous monitoring, planning, assessment and analysis of the ways by which an organization is able to meets the objectives and goals. The development of major goals is also considered to be an important part of the operations of modern organizations. Strategic management is thereby based on the detailed analysis of the external and internal environment (Barros, Hernangómez & Martin-Cruz, 2016).

Telstra has acquired the position of the largest technology and telecommunication based organization. The organization mainly offers a vast range of services to the consumers in Australian telecommunication based sector. Telstra is known for providing more than 17 million retail based mobile services, around 4.9 million retail based fixed line services and greater than 3 million retail based fixed broadband services. The main aim which is set by the company is related to the levels of communication which are develop between people and further increasing the number of opportunities as well (Telstra.com.au., 2018).

Political factors – The political situation of a country is able to play a major role in proper determination of profitability levels of Telstra in the telecommunications based industry. The implementation of new tax based policies is an important aspect which affects the operations of Telstra in the industry. The changes which are made in the fiscal policies and trade policies can affect the business based procedures.

Economic factors – The economic performance which is shown by the country is an important factor which affects the operations of Telstra and trade policies which are developed in the country as well. Understanding the demands of consumers is an important way to mitigate the risks which are provided by the economic environment of the country (Daspit et al., 2017).

Social factors – The social condition of a country is based on different determinants which include, cultural trends, demographics and analysis of the population. The unwanted changes which are a part of the business operations of Telstra are a part of the social factors.

Technological factors – Technology is able to provide an important level of advantage to the operations of Telstra in the competitive telecommunications industry. The organization is thereby able to develop an effective competitive advantage in the country as compared to the competitors.

Legal factors – The legal factors are based on the internal and the external operational environment of Telstra. The laws which are developed by the government have a major impact on the regulations and policies which are formed within the organization itself (Demir, Wennberg & McKelvie, 2017).  

Industry Analysis using Porter’s five forces

Environmental factors – The geographical location and weather also has a major impact on the effective operations of modern organizations. The activities based on networking which are performed by Telstra are able to affect the revenues and levels of profitability in a huge manner.

Conclusion based on macro-environment analysis 

The macro-environment analysis of Telstra has been able to depict that the political environment, economic condition and technological environment affects the operations in a huge manner. The formation of strategies is thereby based on the factors related to the external environment of the organization.

Industry analysis can be considered as a tool which helps in providing an understanding based on the position which is developed by an organization as compared to its competitors. The analysis of industry of a particular organization is based on different forces which are able to affect the profitability based levels. This is considered to be an important part of strategic planning based process which is considered by the organization. Porter’s five forces framework is considered to be an effective tool which is used for proper analysis of the industry in which an organization (Durand, Grant & Madsen, 2017). The analysis is mainly based five different forces which affect the organizational operations.

Power of the buyers – The first major force is based on the power which is held by the buyers in the industry. The options which is provided to the consumers by different organizations are able to increase their power. Telstra faces major threat from this force as the competitors of the organization provide similar products and services.

Power of the suppliers – The superior levels of services can be provided by the organization with proper support and raw materials provided by the suppliers. The power of suppliers in case of Telstra is quite low as the organization aims at providing the best level of services to the consumers (Dobbs, 2014).

Rivalry levels between the competitors – The levels of competitive rivalry which exist in the telecommunication based industry are quite high. The execution of proper business operations by the Telstra is affected by the levels of competition. The competitors in telecommunications industry are considered to be highly important for the proper operations and profitability levels of Telstra. The rivalry based force is thereby considered to have high power in case of the operations of Telstra (Dyer et al., 2015).

Threats provided by the new entrants – Potential levels of threats are provided to Telstra by the new organizations which enter the industry. The profits of Telstra are also reduced by the entry of different new organizations within the telecommunications industry. The organization can aim at increasing the effectiveness of the business prices in order to operate profitably within the industry.

Internal Analysis of Telstra

Threats provided by the substitutes – The threats are also provided by the organizations which are able to provide direct substitutes of the products which are offered by Telstra. The major competitors of Telstra which operate in the telecommunications based industry mainly include, Vodafone, Optus, Virgin mobile (Engert, Rauter & Baumgartner, 2016).

Conclusion based on five-forces analysis

The analysis of telecommunications industry has been able to depict that Telstra is able to provide a vast variety of products to the customers in a highly competitive environment. However, the services which are offered by the organization are mainly affected by different forces which are a part of the industry. Telstra thereby needs to considered the different industry forces in order to operate profitably in the industry. The levels of competition can also affect the effective operations of Telstra.  

Internal analysis is considered to be a process which is used for exploring the competency levels of the organizations. Different factors which are analysed with the internal analysis based process mainly include, cost position of the organization, competitive viability and core competencies. The viability of the organizational operations is also considered to be an important factor which can be analysed with the help of internal analysis based process. The ways by which an organization can sustain its operations and further grow the business based operations can be detected by analysing the internal environment (Ethiraj, Gambardella & Helfat, 2018).

Telstra provides importance to the changes which need to be implemented within the organization in order to transform the operations. The operating environment of the organization is based on fresh set of skills and directions based on career. The employees of Telstra and their capability levels are related to the core value which are followed by the organization. The levels of simplicity which are implemented within the operations are important for the profitability levels of Telstra (Frynas & Mellahi, 2015). The worldwide evolution of the industry is thereby able to affect the workplace environment developed in Telstra. Equality and diversity can be considered to be major competencies of Telstra. The individual leaders of the organization are also able to increase the levels of flexibility and fairness within the organizational operations.

Strengths –  The major strengths which have been developed by the operations of Telstra are based on the ways by which the organization is able to thrive in the telecommunications based industry. The share of Telstra in the market is also protected effectively with the help of its strengths. The organization has depicted superb levels of performance in the new market based areas. The cash flow levels of Telstra and the company has been successful in developing its revenue stream as well. The levels of customer satisfaction which have been achieved by Telstra are high as compared to the competitors. Telstra has also been able to develop a vast distribution network in order to operate in the industry (Hill, Jones & Schilling, 2014).

Business Level Strategies

Weaknesses – The marketing activities which are performed by Telstra Corporation need to be improved in order to increase the profitability levels of the organization. The challenges which are being provided by the new entrants also need to be managed effectively by Telstra. The organization can also aim at making more investment in the research and development based activities in order to improve the product offerings. The product of Telstra also needs to be diversified in order to improve its position in the industry (Hubbard, Rice & Galvin, 2014).

Conclusion based on internal analysis 

The internal analysis of Telstra depicts that the core competencies and capabilities of the organization are able to play a key role in the operations. The resources which have been gained by the organization while operating in the telecommunications based industry are highly important for high levels of profitability and revenues. The analysis has also been able to show the internal strengths as well as weaknesses in operations.

The business level strategies play a major role in development of effective competitive advantage in the industry. Owners of the modern business organizations are thereby able to create an effective competitive in the market with the help of business level strategies. The business level strategies are mainly related to the ways by which the organization is able to compete in the market. The strategic decisions which are taken by the organizations are based on these effective business level strategies. These strategies can also be termed as effective positioning strategies which are helpful in securing the position and identity of the organizations in the industry (Karadag, 2015).

The corporate strategy which has been implemented by Telstra is based on the ways by which the Australian market can be led with the help of simplification of the services and products. The improvement of customer experience is also considered to be a major part of the business level strategies which have been implemented by Telstra. The new strategy which has been developed Telstra is based on the following four pillars,

• Simplifying the product based offerings, eliminating the pain points of customers and further creating digital experiences as well.
• Establishing an infrastructure business which is standalone and will be helpful in driving the performance in order to provide the future opportunities.
• Simplifying the business structure and providing empowerment to the employees in order to serve the customers.
• Portfolio management and cost reduction program which leads the industry (Kasemsap, 2014).

Primary activities –

Inbound logistics – This is based on the network based and electronic components which are required for business operations.

Operations – The new areas which are based on connectivity can be developed and network facilities can be maintained.

Outbound logistics – The transport based activities of the organization which are able to provide communication with the warehouses is a major part of this aspect.

Sales and marketing – The products designed by Telstra are offered in different retail stores of and further the installations are also made in an effective manner.

Service and support – The experience provided to the customers can be enhanced with the help of different online stores and customer based business centres (Meyer, Neck & Meeks, 2017).

Support activities –

Firm infrastructure – The infrastructure is based on different departments which include, finance, management, legal.

Human resource management – The human resource management of Telstra is based on more than 36,000 employees who are a part of the positive work culture.

Technology development – Development of technology is considered to be the most important part of the successful operations of Telstra in the industry.

Procurement – The network based equipment and IT equipments are procured from the suppliers in order to maintain an effective network (Michael, Storey & Thomas, 2017).

Conclusion

The value chain based analysis of Telstra has been able to show that the organization has developed different departments for its operations in the telecommunications industry. The business level strategy which has been developed by Telstra is also considered to be a major factor which is able to affect the operations of the organization.

References  

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Dobbs, ME (2014). ‘Guidelines for applying Porter’s five forces framework: a set of industry analysis templates’, Competitiveness Review, vol. 24, no. 1, pp. 32–45.

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Karadag, H. (2015). Financial management challenges in small and medium-sized enterprises: A strategic management approach. Emerging Markets Journal, 5(1), p.26.

Kasemsap, K. (2014). Strategic innovation management: An integrative framework and causal model of knowledge management, strategic orientation, organizational innovation, and organizational performance. In Strategic approaches for human capital management and development in a turbulent economy (pp. 102-116). IGI Global.

Meyer, G.D., Neck, H.M. & Meeks, M.D. (2017). The entrepreneurship?strategic management interface. Strategic entrepreneurship: Creating a new mindset, pp.17-44.

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Telstra.com.au. (2018). Telstra – About us, investors, media, community & environment and our company. Retrieved from https://www.telstra.com.au/aboutus