The success of Vodafone over the years results from the company’s adoption of effective corporate-level strategies. The company has withstood intensive competition in the telecommunication market due to utilizing its stakeholders in determining appropriate ways of responding to the changing market trends. The company makes use of its employees’, financiers’, and suppliers’ opinions to boost its operations. The company has diversified its operations from voice-based business and ventured into information technology products, mobile payments, service provision to enterprises, and developing products for other firms. Through diversification, the company has increased its revenue and expanded its markets worldwide making it one of the giants in the global telecommunication sector. However, the firm should formulate effective marketing strategies and invest in its workforce through technology and motivation to guarantee the success of the growth approaches.
Vodafone is a company which is based in the UK and has maintained its reputation in the telecommunication industry. It has been named as the world's second-biggest mobile telecommunication organization and was founded in 1991. Its profitability is high because it has managed to reach more than 60 nations in the world. Vodafone has approximately ninety thousand employees. The significant goal of Vodafone is to enhance their services and to offer to their subscribers the best network coverage and facilities. It also intends to maintain its leadership position in the market. Despite that the company specializes in the service sector, it also offers products. Vodafone deals with; mobile network, internet services as well as digital television. It has a competitive pricing strategy and about place mix, it is operational in about 60 countries. In a few regions, Vodafone works in partnership with other companies while in other regions it operates with no partnership. As Vodafone has its activities everywhere throughout the world, so they approach all sort of promotional channels. They make use of the internet, online networking, and old-style channels to distribute its products and above all the promotion propelled by Vodafone could be considered as most informative and innovative. Therefore, it describes companies marketing mix (Chen and Mohamed 2008, pg. 69).
Vodafone understands the importance of internal communication in enhancing the realization of its goals. The company’s personnel need to be informed and engage in understanding and anticipating the needs of customers thereby responding faster and deliver quality and value than the competitors. Through the support of its internal communication, the company identified SnapComms as the best communication platform that can offer its team the ability to communicate in a unique, innovative, fun, and effective manner. The collaboration helped the company to customize the existing offerings and developed a new communication tool to meet its internal communications requirements. A discussion presented by Horst (2018) indicates that before adopting SnapComms, Vodafone was identifying communication options to help overcome diverse challenges such as junk messages and low staff survey response rates. The firm needed communication platforms to reduce team meetings enhance the central management of the internal communication process, help staff locate information, gather staff feedback easily, and timed and targeted employee communications thus the choice of SnapComms.
Vodafone notes that its employees may have vital insights relating to important business issues or ideas that can improve business performance. The SnapComms Survey tool helps to capture the employees’ insights and suggestions. The information is collected through the Survey tool which also facilitates the measurement of cultural and behavioral shifts. For instance, the Vodafone’s ‘i.commute’ survey conducted through SnapComms helps to track how the employees travel to and from work. The company uses the Staff Quiz Tool to enhance its employees’ awareness and reinforce their knowledge about key products, services, and projects. As such, the company can personalize its internal communication platforms by using interesting and attractive themes to ensure a high rate of employee participation.
An analysis of the company's strategic position
Vodafone has ensured diversification of its operation process, its activities, organization culture and totally distinct entities due to a wide geographic area of operations. It offers a good mix of keeping up Brand Image and values of the organization alongside localizing products and services. This gives us an opportunity to observe upon various types of leadership and cultural traits in the company. This sort of company gives us an ideal case of solidarity in diversification (the University of Wales, library).
Vodafone’s leadership styles include; Transformational Leadership: This is a leadership style where the top leadership spends a lot of time communicating with its team members. This style involves leading from the front and only delegating responsibilities to team members. The leader motivates moves the other colleagues with his/her enthusiasm, vision and leadership skills. The top management and leaders in Vodafone use this leadership style. This motivates the team members to better their performance.
Task Oriented: This style of leadership is mainly used in the marketing department where the main objective of the managers is sales and achieving targets. This has enabled Vodafone to have customers in excess of 323 million.
Situational Leadership: This is the best leadership style as it incorporates the advantages and attributes of the other styles of leadership depending on the situation. This leadership style expels all the shortcomings of the other styles. This style is however dependent on the leader’s discretion and its success is reliant on the manager (the University of Wales, library).
Vodafone recognizes the need for excellent internal communication so as to meet its objectives. Its employees should be educated, and enthusiastic to be able to recognize the needs of its customers and deliver high value and quality faster than competitors. The internal communication team in Vodafone is constantly looking for methods of communication which are effective, fun, and imaginative. SnapComms offers Vodafone such a good solution. SnapComms has customized its existing features and offered Vodafone a tool which meets its internal communication requirements. With SnapComms tools, Vodafone’s employees keep on delivering the amazing experience that clients have generally expected from Vodafone (the University of Wales, library).
The Suitability of the Vodafone’s Current Strategies
Vodafone’s current strategies are suitable as it enhances the growth and sustainability of its operations. The company’s reliance on stakeholder analysis enhances the success of its operations. The company seeks the opinions of its financers as its operations should consider the interests of the people who ensure that it has sufficient funds. According to Horst (2018), disregarding the views of financiers may reduce funding leading to the failure of company operations. The use of SnapComms as the employees’ communication platforms enhances their collaboration and sharing of ideas that form the basis of the company's operational strategies. Over the years, the company’s market share and sales have increased. Research conducted by Vogel sang (2013) established that the firm's market analysis findings had necessitated Vodafone's expansion and diversification processes findings. For instance, the company’s venture in information technology and mobile payments services was instigated by the realization that despite its performance, the telecommunications industry has evolved rapidly and has many entrants. According to Vogel sang(2013), in 2007, the company’s average revenue per user in India declined to Rs 182 from Rs 361 in the second quarter ending December 2007-08, when it commenced its India operations. As such, since voice-based service would not guarantee its long-term survival, profitability, and growth, the company needed to diversify its products and service portfolio.
Vodafone’s mergers with cable companies offer the company opportunities for extensive cost savings. Gupta(2012) notes that the acquisition of Tele2, Com Hem, and UPC Austria owned by Liberty Global led to considerable savings. According to Gupta (2012), Vodafone anticipates €535 million savings in capital expenditure and cost savings largely from IT/billing and network integration and simplification. Also, the mergers present substantial revenue synergies, especially through the cross-selling of the products to existing customers. Almor, Tarba, and Margalit (2014) indicate that it is difficult to develop a converged customer base organically, but mergers and acquisitions provide business shortcuts to diversify offerings. Working with Liberty Global will enable Vodafone to acquire pay or fixed broadband television services in Romania, the Czech Republic, and Hungary. Similarly, the acquisition of Unity media’s cable networks in Germany will increase its expansion potential. As such, the mergers will grow the company’s market base effectively
A critical evaluation of the strengths and limitations
Enormous market scope – Forbes has placed Vodafone at position 395 in a list of 2000 main brands in the world. Vodafone has enhanced its reputation by having a wide coverage. In India; it has the second highest number of subscribers behind only China Mobile. Vodafone has extended its network coverage to more than 60 countries in the world. Incomes created – Vodafone generates billions of dollars in income consistently. In 2017 it made a profit of 87.3 billion dollars. These profits have boosted the rankings of Vodafone significantly further. This has improved its position to 104 in Forbes’s 2000 rundown and places it at number 84 when ranked using market value.
Marketing – The Marketing by Vodafone is incredible. The Vodafone pug is well-known over the world to take after the company’s subscribers all over. Similarly, the Vodafone zoo's was a splendid and appealing campaign which won over numerous customers to fanatics of Vodafone. The company has always been coming up with splendid campaigns.
Premium cost – Vodafone keeps on changing its services as other operators enter the market. Subscribers think that Vodafone is many steps ahead because of its increased marketing and effective communication. Subsequently, Vodafone gets some premium out of their customers and float in margins while other operators are struggling to keep up positive margins.
Dropping subscriber base – This is a remarkable matter for Vodafone taking a look at the market across the world. There is a need for strengthening of the company’s core values and implementation of strategies aimed at gaining new customers and maintaining its current customers.
Falling brand valuation – Vodafone’s falling brand valuation can be the reason behind its fall in subscriber base. Previously, the company had a very strong subscriber base and a high brand value. However, this has not been the case for the last three-four years. The company suffered a significant drop in brand valuation in the last one year.
Losing market share in USA – Vodafone getting the premium market in the USA would have kept it afloat. This company is, however, losing its market share in the USA to AT&T and Verizon wireless which can be considered to be performing far better than Vodafone if considering the USA market only.
Poor performance in Europe – The performance of Vodafone in its home market is poor because of the effect of Brexit as well as Europe’s economic condition. This has led to poor income generation from this market. Indeed 40% of Vodafone’s revenue is from India as opposed to the UK.
Stakeholder Analysis and Involvement
The relationship between Vodafone and its stakeholders, mainly investors, employees, and suppliers, greatly influence the organization’s operations. The firm relies on their opinions to determine which projects, especially those in the early stages, to implement. The company notes that the stakeholders’ contributions not only support its operations’ success but also can improve the quality of operations, consequently, success in the future. An analysis conducted by Mirza and Beltrán (2014) established that the company recognizes influential stakeholders can provide resources thereby guarantee the completion of projects. Stahl, Chua, and Pablo (2012) argue that timely and consistent communication with stakeholders informs Vodafone’s employees regarding current tasks and projects and their gains or impact. As such, they can support the company actively when necessary.
The success of Vodafone’s acquisitions and mergers depends on different factors. Organizations should not limit their focus to the financial gains of expansion and diversification; instead, they should consider non-financial aspects such as marketing strategies (Klettner, Clarke, & Boersma, 2014). A company requires strong marketing strategy to expand its markets and withstand competition (Homburg, Artz, & Wieseke, 2012). Vodafone faces the risk of failure in its growth plans if it lacks effective marketing strategies thus the need to develop appropriate techniques to grow in the diverse markets.
Also, Vodafone requires the support of its employees in its diversification and expansion processes. Organizations should address the needs of their employees to motivate them and enhance their productivity (Pedulla, 2013). The employees should receive career development benefits to increase their performance. Moreover, the telecommunication market is prone to shifts thus requires employees to be abreast with technological advancements (Hausman & Taylor, 2013). Vodafone faces the risk of lagging behind technology if its employees are not equipped with essential technological knowledge. Stahl et al.(2012) clarify that skilled and knowledgeable employees are critical assets to companies desirous of attaining a competitive advantage in the market. Therefore, Vodafone should invest in motivating and developing its workforce
Vodafone’s corporate-level strategies are designed to enhance its growth to top the telecommunications market. The company has adopted diverse strategies such as engaging stakeholders, mainly investors, suppliers, and employees, to enhance their financial and information contribution towards its growth and profitability. Also, the company has adopted the SnapComms platform for internal communication to facilitate and ease interaction among the employees. Moreover, the firm’s diversification and acquisition strategy, which targets information technology, cable networks, and television and broadband companies while diversifying into leased lines, data services, voice, and conferencing markets, can, guarantee its longevity. However, the management should consider the interests of its employees and develop effective marketing approaches to enhance the success of its strategies.
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