Telstra Corporation Limited: Operations And Analysis Of Factors Affecting The Telecommunications Industry In Australia

Overview of Telstra Corporation’s History and Current Operations

Telstra Corporation Limited is an Australian organization which operates in the telecommunications industry. The organization mainly builds and also operates different telecommunications based networks, mobile access, internet access, television based services. The organization has been able to develop a history in the Australia telecommunications industry for a long time. Telstra became a totally privatised organization after a few years of its operations in the telecommunications industry. The company further went through an effective change program under the previous CEO David Thodey. The current CEO of the company is however struggling in order to continue the processes of the firm in an effective way in the telecommunications based industry (Telstra.com.au., 2018).

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The telecommunication industry in Australia and its growth is hugely driven by the government of the country. The regulations which are faced by the industry have been developed in an effective manner by the government of Australia. The telephone services were first started in Australia by providing connection between the South Melbourne and Melbourne based offices of the Robinson Brothers in the year 1879. The first telephone exchange was thereby developed in the year 1880. The telecommunications industry of Australia has however depicted huge amounts of growth in the recent times. The competitiveness in the industry has increased in a huge manner. This has further led to the reduction of the competitive advantage and revenues of companies which operate in the industry. Telstra has however been able to gain a competitive place in the Australian retail industry with the help of its long term operations (Barros, Hernangómez & Martin-Cruz, 2016).

Economic factors – The macro environmental factors of Australia are able to influence the processes of Telstra Corporation in an effective manner. The diverse macro environmental aspects that are thereby able to affect the organization mainly include, savings rate, inflation rate, economic cycle and foreign exchange rate. The economic stability of the country can be used by Telstra in order to increase its revenues in an effective manner (Daspit et al., 2017).

Physical factors – The shares of Telstra are affected by the operations of the company in the telecommunications industry of Australia. The macro economic factors are able to drive the share prices of the company. The physical stores of the company are thereby an important part of the revenues and profitability of Telstra.

Sociocultural factors – Social condition of Australia and culture is thereby able to affect the operations of Telstra in the modern business environment. The population of the country is able to affect the profitability based levels of Telstra. The understanding which is required by the company of the needs and demands of consumers is an important part of the social factors of Australia. The demographics and skill based levels of people are important factors which need to be considered by Telstra (Demir, Wennberg & McKelvie, 2017).

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Analysis of Environmental and Competitive Factors Affecting Telstra’s Revenue and Profitability

Global factors – The economic turbulence that had taken place on a global basis was able to affect the telecommunications industry. Telstra is also affected by changes that have taken place in the industry of its operations. The global policies are thereby able to influence the prices of services that are charged by the firm.

Technological factors – The fast disrupting industry of technology is able to affect the operations of large organizations like Telstra. The recent developments which have been made in the technological industry are able to affect the revenues of Telstra in a significant manner. The cost structure that has been developed by the industry is also influenced by the technologies (Durand, Grant & Madsen, 2017).

Political or legal factors – The political factors are able to affect the long term profitability of Telstra Corporation Limited in the industry. The operations of the company in industry are thereby affected by policies and regulations which have been developed by the government of Australia. The different political issues which need to be analysed by Telstra in order to operate in the industry include, the stability of the area in which it operates, levels of corruption in the government and various other factors (Dyer et al., 2015).

Demographic factors – The demographic factors are able to play a key part in the proper processes of Telstra in the telecommunications based sector. The analysis of demographics is based on different factors that include, the age of consumers, the income levels and their occupation as well. The demographic factors need to be analysed by the company in order to decide the products or services which can be offered to the consumers (Engert, Rauter & Baumgartner, 2016).

Power of the suppliers – The organizations in the telecommunications based services industry is mainly known for buying their raw materials from different types of suppliers. The suppliers who are able to develop a dominant position in the industry are able to decrease the levels of profitability of the companies which operate in these areas. Telstra Corporation can increase its revenues in the market with the help of the reduction of supplier power. The development of an effective supply chain is thereby an important part of the operations of Telstra. The power of the suppliers in telecommunications industry is high (Dobbs, 2014).

Power of the buyers – The buyers in modern business environment are quite powerful in nature. The pressure is thereby created on the profitability of Telstra in the telecommunications industry. The powerful customer base of the company is a significant role of the proper processes of Telstra in the telecommunications industry. Telstra has been able to develop its customer base in the industry with the help of its active customer base. The power of the buyers of Telstra is moderate (Ethiraj, Gambardella & Helfat, 2018).

Economic Factors

Threats based on the substitute products – The needs of customers can be fulfilled in an active way with the help of products that are presented by the company. The companies which are able to offer similar or substitute products to Telstra can provide tough competition to Telstra in its operations in the telecommunications industry. The service oriented operating process of an organization can affect the operations. The threats from substitute products to Telstra in the telecommunications industry is moderate (Frynas & Mellahi, 2015).

Threats from the new entrants – The entry of new organizations in the telecommunications industry has been able to introduce innovations in an effective manner. The lower pricing based strategy which is implemented by new organizations are thereby able to influence the prices of the products that are offered by existing companies. Telstra has however been able to develop a competitive advantage in order to function in a cost-effective manner. The threats that provided to the company by entry of new companies is low (Galliers & Leidner, 2014).

Rivalry among the competitors – The stages of rivalry which are present in the industry are quite high. The telecommunications industry is highly competitive in nature and this is able to affect the levels of profitability and the revenues of Telstra. The competitive levels between the companies in telecommunications industry is quite high (Hill, Jones & Schilling, 2014).

The competitive environment which has been developed in the industry is quite high. The different organizations are thereby able to provide tough levels of competition to Telstra Corporation. Telstra has been able to create an effective position in the telecommunications industry with the help of its long term operations in Australia The place which has been developed by the firm in the industry has been affected by the two major organizations which also operate in the Australian telecommunications industry named Vodafone and Optus. The market share of Telstra has been increased from 42 percent to 53 percent from 2010 to 2014 (Theaustralian.com.au., 2018).

The mobile division of the company had been on track with more than 10 billion Dollars. The number of subscribers of Optus had been reduced to around 9.4 million and the revenues of Vodafone has decreased to 5.3 million. The major threats which are provided to Telstra are based on the services which are provided by companies like Optus and Vodafone and their similarity with those provided by the company. The major capabilities that have been gained by the company are based on their financial and human resources which can be used by Telstra (Theaustralian.com.au., 2018).

Physical Factors

Opportunities – The decrease which have been experienced in the transportation based costs have been able to provide major opportunities to Telstra. The customers who have been gained by the company from different online channels have been able to play a major role in creating opportunities for the company. The lower rates of inflation are important opportunities provided to Telstra. New trends have been developed by the variations which have taken place in the behaviour of the consumers which is an opportunity for the operation of Telstra. The emerging markets will thereby play a major role in increasing the revenues and profitability of Telstra (Kasemsap, 2014).

Threats – The lack of regularity of the supply of different innovative products is a major threat to the operations of Telstra. The development of new and improved technologies which have been created by the competitors is a major threat which has been faced by Telstra in the telecommunications industry (Meyer, Neck & Meeks, 2017).

The mining and resources of Telstra is a major part of the operations of the company in telecommunications industry. The boom which has been experienced by powerful ICT based resources of Telstra is able to enhance the productivity with the help of proper automation of the processes and streamlining of the operations in order to achieve high levels of visibility. The company is able to deploy the effective solutions in order to become more cost efficient in nature (Morschett, Schramm-Klein & Zentes, 2015).

The human based resources or employees of the company are able to affect the processes of the firm in an effective way. The employees of the company are able to provide the best level of services to the company in order to satisfy the consumers. The training and development based resources of the firm have thereby played a main part in the methods by which Telstra is able to develop its place in the industry (Michael, Storey & Thomas, 2017).

The culture and the capabilities which have been developed by Telstra are based on the technologies which have been gained in the industry. The technologies are thereby able to transform the workplace in an effective manner. The operating environment of the organization is developed in an effective manner with the help of career based directions and fresh sets of skill sets as well. The workplace is thereby reshaped with the help of proper opportunities and capabilities. The key capabilities of the company are thereby focussed in an effective manner towards greater levels of simplicity in the operations (Peltier, 2016).

Sociocultural Factors

The evolution of the roles of different employees are thereby affected by the capabilities that have been gained by the organizations. The company thereby aims at creating an effective environment which is supportive and inclusive in nature. The changes that can be made in the workplace environment help the human resources or the employees to shine in an effective way. The individual leaders are thereby able to foster high levels of flexibility and fairness within the teams (Sakas, Vlachos & Nasiopoulos, 2014).

First competency – The telecommunications industry has been able to experience high levels of growth and the traffic in the network is also growing in an effective manner. The digital technologies have been able to change the world and operations of different organizations in the telecommunications industry. Telstra has been able to develop its position in heart of the changes which have taken place in the industry. The major purpose of the company is thereby to develop the technologies in such a manner which is helpful in developing a bright future. The values which have been possessed by the company are also based on the services which are offered to the consumers in an effective manner (Soomro, Shah & Ahmed, 2016).

Core competency test – Valuable – Moderate, Imitability – Moderate, Rarity – Low, Organization – Moderate

Second core competency – The core competencies which have been developed by Telstra are based on the major activities that are performed for providing basic access based services to the businesses and homes in the country. The mobile telecommunication services that are provided to the company are also based on the core competencies of Telstra. Telstra is also considered to be a leading provider of services of telecommunication based services. The wholesale based services which are provided by the company are based on the various competencies that have been gained by Telstra (Morschett, Schramm-Klein & Zentes, 2015).

Core competency test – Valuable – High, Rarity – High, Imitability – Moderate, Organization – High

The changes which have taken place in the external environment have led to the high levels of importance of the information systems. The information systems are able to play an significant part in the proper management of data. The data that needs to managed by the organizations are mainly based on the customers and other resources which are developed in the industry. The usage of technology has also played a main part in developing the importance of information systems. Telstra will also require an effective information based system in order to operate in the industry. The implementation of management information system will be the most effective for the managers who are a major part of Telstra (Soomro, Shah & Ahmed, 2016).

Global Factors

The major stages that will thereby be addressed with the help of proper management information system include, problem identification, implementation, search information, system need, system design, documentation and testing. The Oracle software can be used in an effective manner by Telstra in order to implement proper management information system. The major usage of the management information system is based on the sales and marketing based activities, accounting activities and the human resource management based activities (Peltier, 2016).

The implementation of Oracle based management information system can play an important part in the methods by which the data of consumers can be maintained in an effective manner. The human resource of the organization can also be maintained in an effective way with the help of proper implementation of the proposed management information based system in Telstra.

Conclusion: 

The analysis in the report can thereby be settled by stating that the external and the internal environment analysis of Telstra has played a major part in the development of proper strategies. The resources that have been developed by the organization are also an important part of the effective processes of Telstra in the telecommunications based industry of Australia. The report has been able to offer an effective recommendation based on the management information based system that can be implemented by Telstra in an effective manner. The information system can play a key part in the management of human resources and the customers as well.

References: 

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Telstra.com.au. (2018). Telstra – mobile phones, prepaid phones, broadband, internet, home phones, business phones. Retrieved from https://www.telstra.com.au/

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