Essays on SWOT Analysis of Telefonica - Resolving Strategy Paradoxes to Create Competitive Advantage Case Study

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The paper “ SWOT Analysis of Telefonica - Resolving Strategy Paradoxes to Create Competitive Advantage" is a  delightful example of a case study on management. Business firms rely on strategies to  attain  their business objects, especially where there  is increased  competition.   In 1986, Telefonica, one of the telecommunication providers in Spain, saw the need  to reassess  its competitiveness because of the significant changes in the telecom industry. Through an evaluation of the firm, it becomes possible to  draw  immense  insight from the SWOT analysis of the firm, back in 1986.In 1986, Telefonica had a number of strengths that gave it greater advantage over other players in the market.

First, Telefonica had immense  access to the communication market in Spain because it was a  national  corporation operating in the communications industry. In addition, Telefonica had better access to  equipment, managerial skills, capital for expansion into other regions like South America. Notably, these characteristics were  notable  for Telefonica to compete with other local firms, as well as new entrants from the European Union. Apart from the strengths above, Telefonica encountered several weaknesses that affected its ability to  compete  in the telecommunication arena contrary to its expectation. These weaknesses included consumers in Spain who were aware of Telefonica’ s  poor  ability  as it delivered  poor  services to its clients across Spain.   Because of this poor ability, the firms never managed to  solve  all complaints from its customers.   Over again, the  firm  did not have sufficient capacity to handle the increasing demand for services.

The  lack  of such capacity is a weakness and a bottleneck that must be a  firm  must overcome using a strategic plan (De Wit & Meyer, 2010). Opportunities are also crucial aspects that a firm uses to develop a strategic plan in business. Telefonica, in 1986, had a handful of opportunities available at its disposal. In Spain, there was a  demand  for more services as the market required more communication services.

This  opportunity  prompted Telefonica to acquire new equipment  in order to expand their services to new areas in Spain with little coverage. Most important,   acquisition  of new technology made Telefonica envision more customers going after is services as compared to those of other local providers. Equally important, the pending  regulation  in South American was an  opportunity  for Telefonica. In 1986, Telefonica had several threats such as new regulations that would take effect when Spain joins the European Union. This threat would force, Telefonica to compete with other players in the market and possibly lower its prices to appeal to customers. Telefonica’ s focus in Europe and SpainWith the need to capitalize on its opportunities, Telefonica opened the business in Latin America as a strategy of expanding its business and cushioning itself against increased competition in Europe.

Nonetheless, the firm’ s investment and focus on the European market became more, despite the significant growth in the telecommunication market in Latin America than in Europe or Spain. This move is justified because the firm's strong base in Spain that could allow it to edge out other local competitors.

Moreover, Telefonica understood the importance of establishing itself in other countries that were members of the European Union. These reasons are some of the push factors that made Telefonica acquire new equipment in search of new customers in the expansive European market (Griffin & Pustay, 2000).

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