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Idеntity аnd Disсuss а Маnаgеmеnt Issuе thаt Rеlаtеs tо thе Маnаgеmеnt Funсtiоn (Рlаnning оr Strаtеgy) based on Telstra case Essay Example

  • Category:
    Management
  • Document type:
    Assignment
  • Level:
    Undergraduate
  • Page:
    2
  • Words:
    913

Telstra5 Management Issue

Idеntity аnd Disсuss а Маnаgеmеnt Issuе thаt Rеlаtеs tо thе Маnаgеmеnt Funсtiоn (Рlаnning оr Strаtеgy) based on Telstra case

Introduction

Telstra is a dominant telephone and telecommunication provider in Australia. However, Telstra management has faced various problems such as increasing competition and close scrutiny from the public and its shareholders as well as the government. The major problem that faced Telstra management was regarding its monopolies not doing well when government’s robust regulatory power was deployed. This followed Telstra improper planning by deciding to reject the government’s bid on the national broadband network. Rather, Telstra planned to implement its own network. This was met with stiff competition from its rivals with claims that Telstra was taking advantage of its market dominance to limit competition. As a result, government intervened deploying its massive regulatory power to curb Telstra’s monopoly.

Issues Identification

Telstra management made the wrong decision to reject the government bid to upgrade the national broadband network. In turn, the company opted for a plan/strategy to upgrade its own network cables. This led Telstra into a major problem with the government and its rivals. Telstra’s move to reject the bid from the Australian government was a wrong plan. Planning is aimed at creating and maintaining a plan and actions necessary to form the desired objective (Wischnevsky, & Damanpour, 2006). This is because Telstra’s rejection of the government’s proposal led the government to use its regulatory powers to counteract Telstra monopoly in the market. Telstra targeted to take advantage of its dominance in the market to overcome competition from its rivals. In addition, the government showed greater efforts in inspecting Telstra compared to its rival. As a matter of fact, wrong planning leads a company into trouble. Telstra faced an embarrassing situation as well as the risk of losing its dominant market position. Telstra misjudged the market environment while making the decision to turn down the government’s offer.

Critical Discussion

Telstra company needs to launch Michael Porter’s Value Chain model which is a good planning model (Jonker, & Witte, 2006). This model is a business evaluation tool that will help Telstra to locate itself tactically between buyers, competitors, suppliers and the government at large. Most importantly, the model is based on various dimensions like marketing, producing, designing, supporting and delivery which influence the competitive advantage (Magretta, 2012). Through this model, Telstra will be able to search the real executable actions in business units. That is, identification of the basic actions to planning or strategy accomplishments. Additionally, the model will assist Telstra to define properly its linkage to the purchasers. In this regard, a company is to able to control its flow of exchange both on inside and outside. Furthermore, the value chain model is instrumental for companies in recognizing their resource allocations which determine their tactical direction. Finally, this model will help Telstra uncover its strengths and weaknesses in order to manage its competitive advantage.

According to this model, companies are comprised of various segments which are guided by procedures, dynamics and economic relationship (Porter, 2008). The analysis of this model helps to understand the changes in company’s dynamics. It is observed in Telstra’s case that improper planning led the company to face the challenges of misjudged positions. By using this model, Telstra will understand its current as well as future competitors and be in a position to maintain its competitive advantage over the competitors. Aside from this, this model would help Telstra analyze competition from its suppliers, particularly the government. Telstra management rejected government’s bid due to improper planning which later haunted it as the government utilized its massive regulatory power to confront Telstra monopoly. If Telstra management was based on this model, none of this could have happened.

Initially, Telstra was faced with a problem inadequate infrastructure to service its customers sufficiently. The value chain model helps companies to create proper and sufficient infrastructure to produce the required services. Generally, infrastructure is driven by better strategic planning. On the other side, Telstra was also faced with the challenge of burgeoning technology (Hayajneh, and Raggad, 1995). This model would also help Telstra in developing technologies that sustain competition. Indeed, technology is of vital significance in ensuring competitive benefit. Technology enables companies to be innovative to minimize expenses in order to maintain the competitive advantage.

Conclusion

It is clear that Telstra faced problems due to poor planning which led to inadequate infrastructure, interference from the government as well as burgeoning technology. This was attributed to Telstra management taking the wrong decision to reject the government bid. Therefore, managers are advisable to take care while planning and do it the right way. The value Chain model is recommended as the best model to support Telstra activities such as infrastructure and technology. The model would help Telstra map its flow inside and outside. Implementing the model would assist Telstra maintain the competitive advantage.

References:

Hayajneh, A. F., and Raggad, B. G., (1995). Assessing the relationships between organizational variables and technology: the case of Jordan. International Journal of Commerce and Management , 5(3).

Jonker, J., & Witte, M. C. (2006). Management models for corporate social responsibility. Berlin: Springer.

Magretta, J. (2012). Understanding Michael Porter: The essential guide to competition and strategy. Boston, Mass: Harvard Business Review Press.

Porter, M. E., (2008). Competitive Advantage: Creating and Sustaining Superior Performance. Simon and Schuster.

Wischnevsky, J. D., & Damanpour, F., (2006). «Organizational Transformation and Performance: An Examination of Three Perspectives,» Journal of Managerial Issue, Vol. 18, 104-128.